Archive for February, 1999


Monday, February 15th, 1999

There appears to be an increasing trend by large ISPs to use IP over Fibre in the core backbone, by-passing ATM and even SONET.

The Optical Internetworking Forum (OIF), co-founded by Cisco and Ciena, is focusing on the development and standardisation of technologies for direct connection of IP network systems to DWDM with the same reliability as Sonet/SDH rings, without the overhead of ATM and the legacy of the DS0 hierarchy for Sonet/SDH.

US-based cable modem company @Home Network announced it is creating a new national Internet Protocol (IP) backbone network using leased fibre-optic capacity from AT&T Corp. The company will fire up portions of the network in April and plans to have full availability in August.

The new backbone will have 100 times the capacity of its existing 45Mb/s network, which operates over leased ATM circuits from Sprint Corp. @Home says its dual OC-48 network will scale to serve up to 5 million cable modem subscribers and better meet the needs of large commercial customers.

Rather than transporting IP traffic with conventional ATM or SONET solutions, @Home plans to run IP directly over AT&T’s dense wave division multiplexing (DWDM) fibre links. The strategy maximises raw fibre bandwidth utilisation while eliminating the need for costly SONET and ATM gear – a saving of as much as 80% to 90%.

@Home is not alone in this strategy. In August 1998, ISPs Sprint Corp. and Frontier Corp. announced plans to create their own national OC-48 IP-over-DWDM backbone networks.

AT&T will become @Home’s largest shareholder upon the completion of its acquisition of Tele-Communications Inc in 1999. With its aggressive backbone upgrade using AT&T facilities, @Home hopes to position itself as a conduit for AT&T to deliver integrated IP data, voice and video services via TCI cable systems, and potentially those of other @Home affiliates, such as Cablevision Systems, Comcast Corp. and Cox Communications Inc.

Additionally, AT&T is now having discussions with Time Warner about delivering IP and/or circuit-switched telephone services over its cable systems. If such a deal occurs, @Home could be tapped to provide IP backbone support for Road Runner, the broadband Internet venture controlled by Time Warner, MediaOne, Microsoft and Compaq.

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Microsoft to sell MSN February 1999

Monday, February 1st, 1999

This was closely linked to the online history of Australia as it was Microsoft which, together with Telstra, decided to continue the ailing public videotex service, Viatel, in a new proprietary Microsoft version of the Internet, MSN. Within a year Microsoft and Telstra exited from the deal and Microsoft continued its MSN service as a shopping mall service on the Internet.

We have often expressed serious doubts about the service. The latest rumours, as reported by Gareth Powell in his weekly Internet newsletter, is that Microsoft is going to get rid of Microsoft Network.

Following is a quote from Gareth’s newsletter.

‘In fact, Microsoft will sell off its entire Internet publishing holdings. And the likely buyer is AT&T. There have been no denials issued, little debate, minimal comment. Yet the rumour seems possible, even probable. Sources within Microsoft confirm that talks have been held with AT&T although, to date, they have not been conclusive. Microsoft is probably asking too much and AT&T is offering too little. In which case all they are haggling about is price which could lead to an eventual resolution. Sticking my neck right out I will state flatly that Microsoft will sell MSN in one way or another to some company or another. And it will do it sooner than later.’

As we have said before, when it comes to Internet content the company’s strategy has been nothing but disaster. The skills required for developing and selling software are very different from the skills required to produce attractive and enticing entertainment.

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Monday, February 1st, 1999

In January 1999 the company merged with American mobile operator Air Touch in one of the largest telecommunications mergers in the world. The merged company will become the largest mobile operator in the world. Based on the figures of that time the combined value of the operation was estimated at US$88 billion, with a customer base of 27 million customers and operations in the Asia Pacific, Africa, Europe and North America. As both companies operate mobile services based on different standards (Vodafone on GSM and Air Touch on CDMA) there will certainly be some integration problems ahead of the new venture.

There are also other concerns.. The reason why Airtouch was so open to merger propositions was the fact that they had problems establishing a significant national brand presence in their home market in the USA — this despite the fact that the company is enjoying healthy growth. Rivals AT&T and Nextel have done a much better job in this respect. Also BellSouth, with its GSM service, has a much better national presence than AirTouch.

These marketing problems are not simply going to go away because of the merger. A focus on wholesale, rather than resale might be an option; selling off the US business is another (unlikely) option. This doesn’t apply to the company’s European assets (34% of its total subscriber base). They are a perfect match with the Vodafone operations. Their combined Asian coverage is still marginal and neither company has a presence in Latin America.

So while the combined company will be the largest mobile global operator in the world and the third largest in size of mobile subscribers after NTT and China Telecom, there are some serious problems ahead of them which need to be solved before a synergy effect will start to take place due to the merger.

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Monday, February 1st, 1999

Thomas Cook has launched its Internet-based international payments system to Australasia. Called Virtual Trading Desk (VTD) it provides real-time commercial foreign exchange over the Internet and facilitates payments from any Internet-ready computer.

It provides business customers online access to Thomas Cook’s commercial foreign exchange (CFX) service, which specialises in sending and receiving international payments for business.

Customers can send payments either by foreign currency draft or telegraphic transfer literally in seconds, with complete security and without needing to fill in any forms, or even pick up the phone. And once the button has been pressed, Thomas Cook processes and confirms the full cost of the transaction within two minutes by e-mail.

Virtual Trading Desk is Web-based and can be accessed from anywhere in the world via the Thomas Cook Web site at

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Monday, February 1st, 1999

Free e-mail company, RocketTalk, Inc. introduced the first free voice messaging system on the Internet, which can be used amongst RocketTalk users.

Talking is much faster than typing for most of us, and verbal messages are also much better at conveying the full intent and emotional content of the speaker’s message.

Users can record, address and send their messages through RocketTalk’s central message server. It sends and receives messages in the background, eliminating waits as messages download.

RocketTalk requires a multimedia computer (with sound card, speakers, mouse and microphone), plus an Internet connection. The product’s user interface is designed so that virtually anyone can use it . Typical users include families with members in other states or countries; telecommuters, mobile workers, and other professionals; those who don’t, can’t, or simply prefer not to, type; and users who prefer a more ‘personal’ method of messaging.


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