Seeking the high-tech Holy Grail - IP telephony market - Technology Information

Communications News, Feb, 1999 by James Careless

Calls via cable near widespread commercial reality.

IP (Internet protocol) telephony-over-cable TV networks--the Holy Grail of low-cost, practical solutions for telephony--appears poised to become a commercial reality.

While CableLabs--the cable TV industry's research think tank--wrestles with IP telephony standards through its "PacketCable" project, manufacturers are already flooding the market with IP telephony products. For instance, at the recent California Cable Television Association's Western Show in Anaheim, companies, such as 3Com, Nortel, Bellcore, Cisco Systems, Ericsson, General Instrument, Lucent Technologies, Toshiba, and Vienna Systems Corp., featured IP telephony demonstrations and solutions at their booths.

Meanwhile, CableLabs' board of directors has just created a IP telephony task force. Headed by Comcast Corp. vice president of strategic planning, Mark Coblitz, the senior-level task force signals the industry's seriousness about launching IP telephony services in an effort to take customers and revenues away from local telephone companies. And, while this is all going on, two PacketCable committee member MSOs--Videotron and Cogeco Cable--have become industry leaders by announcing plans to roll out commercial IP telephony in the near future.

So, what is IP telephony, and why is the cable TV industry so excited about it? The short answer to the first question is that IP telephony products capture telephone audio, digitize it, and then format it into IP "packets." These packets are transmitted across Internet-style networks--it doesn't have to be the Internet proper (and many cable TV operators shudder at the idea of sending traffic across this hacker-ridden nightmare)--and then received and decoded at the other end, with the audio ending up in the receiver's telephone handset. (Where needed, calls can be interconnected to conventional telephone networks as well.)

The reason cable TV companies are so excited about IP telephony is that they can carry it on their plants without much modification, assuming that these plants have already been upgraded for two-way Internet traffic (which many have) and that the right modems have already been installed at the subscriber end.

At stake is a very big chunk of money, said a recent submission by Videotron to Canada's regulator, the Canadian Radio-television and Telecommunications Commission (CRTC). According to Videotron, "The market analyses that are currently available project that the IP telephony market will amount to $3-$7 billion in the United States within the next five years."

Given this, it's small wonder that the cable TV industry is embracing IP telephony, says PacketCable director David Bukovinski. Unlike other telephony-over-cable solutions, IP is already "so widespread, it's cheap, it works, and it actually does its job very well," Bukovinski says. "It's actually a very efficient transport protocol."

Beyond its simplicity--and the widespread use of the IP standard already--there are two factors that underpin IP telephony's attractiveness for cable.

The first is bandwidth, the traditional nemesis of high-speed IP communications. By running IP telephony on their own two-way fiber-optic networks, cable TV companies will have no problem keeping up with bandwidth demands. That's due to the nature of these networks, which terminate in nodes that each serve a specific-sized group of subscribers over coax.

Say each node serves 1,000 people--if there's too much bandwidth demand, the cable TV company simply doubles its nodes (which, of course, are linked back to its high-capacity trunk network). By doing so, the effective per-node load is reduced to 500 people, thus cutting the traffic load in half. Should the problem occur again, the solution remains the same: simply cut the subscriber groups in half a second time, by once more doubling the nodes.

The second beauty of the IP standard is addressability; in other words, the fact that each device on the network has a unique IP address. Because each one does, the actual physical location of, say, a telephone, ceases to be a big issue. In fact, you can move it as often as you wish--from house to house, or city to city--as long as you advise the network server of the change.

Contrast this with a conventional telephone network, where each wire is identified by a fixed number, and the phone simply appended to the end of it. Because of this, you can't move the phone around without changing the number, because it's the wire, not the phone, that has the identity. Say your mother is staying with you for two weeks, says Bukovinski. For that time period, she could redirect her calls to a specific phone in your house, just by logging into her service provider's Web site beforehand and specifying the change. Armed with the location data, the IP telephony network can do the rest, without any of the hassles associated with conventional dedicated-line telephony. The same goes for fax machines, WebTVs, computers--anything that communicates with the world via telephone.