Lack of SPC tariffing on Telstra's new OnRamp ETSI ISDN service =============================================================== This is a report I posted on 29 May 1997 to the Australian "Internet Issues" and "ISDN" mailing lists. This file is http://www.firstpr.com.au/telco/articles/spc.txt Robin Whittle rw@firstpr.com.au http://www.firstpr.com.au - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - To the members of the INET Issues and the ISDN mailing lists. Thanks for the help in February when I was trying to understand the SPC and XSPC arrangements for Macrolink and Microlink. There will be an article in the June issue of "Australian Communications" magazine about OnRamp. Below are the sections of the article relevant to SPCs. The rest of the article deals with the delay to the launch caused by interception issues and the Opt- out basis on which Calling Number Display has been introduced for OnRamp. See http://www.ozemail.com.au/~firstpr/cnd for background. I think Telstra are nuts to close down the market for permanent links via ISDN. Maybe in the long run, this won't actually happen. - Robin ** I don't usually post substantial parts of articles to mailing ** lists. The artcle and this annotated section of the article is ** copyright Robin Whittle 1997. Its OK to quote parts of it ** in private email, but please don't post it or sections of it ** to other lists or to Usenet. ** Parts of article relating to SPCS and to Calling Number Display ** SPC and XSPC not available on On Ramp, but there will be some ** kind of alternative. On Ramp currently has no equivalent to the SPCs (Semi Permanent Circuits) of the overlay network. These enabled a much more economic 64 kbps long or permanent connection than would be possible with ordinary timed data calls. SPCs are ideal for connecting branch offices to form WANs, for teleworkers and especially for ISPs connecting to each other. The combination of Microlinks and SPCs within urban areas is a crucial factor in the diversity and low cost of Internet access in capital cities. There are actually two totally different kinds of SPC. A Macrolink SPC involves a specially developed protocol for setting up a call between one of the Macrolink's 30 channels and the destination - which must be another Macrolink channel. It is a "nailed up" permanent connection - one which will be automatically re- established by the exchange. There is no equivalent protocol in the Microlink service or the ETSI standard. The second kind of SPC is used from a Microlink to either a Microlink or Macrolink destination channel - and now to an OnRamp destination channel as well. This is known as an XSPC or "interim SPC" and does not involve a "circuit" at all. There is no protocol or "nailing up" of circuits - it is an ordinary data call and the customer's equipment must initiate a new one if it drops out or is terminated. The XSPC is a billing construct - calls from the nominated A party of the XSPC to the nominated B party are simply deleted from the billing system. [Actually, there may have been different technical and administrative arrangments for XSPCs at different times - which would explain some of the apparently conflicting impressions people have of what an XSPC involves.] XSPC calls must be made with certain restrictions on the numbers used and how the call was made. This has been an error-prone process, and human error both on the part of Telstra and its customers has resulted in considerable grief. [I expect that if Telstra really wanted to, they would organise things better and reduce the sources of problems. I also think that Telstra is overstating their concern about these problems - the bottom line is that they beleive that ISDN is a switched service and they simply don't want customers using it for permanent connections.] The overlay network will be maintained until the year 2000, but Telstra is unenthusiastic about connecting new customers to Microlink services in areas where OnRamp is available - even when an existing B-Mux has some spare capacity. Customers such as ISPs who use ISDN for permanent connections will probably want to keep using Microlinks in order to access the XSPC tarrifs. ["Unenthusiasic" is the best simple description. I tried to get something more concrete. Christine Groh didn't seem to want to commit to connecting customers, or to not connecting them, but it was clear that she did not want to encourage greater use of the overlay network. What was clear was that there would be no new B- MUXes purchased - which is fair enough.] SPC costs for Microlink and Macrolink are shown in Table 2, compared with the On Ramp costs for timed calls 24 hour a day, or during business hours. These are for a single 64 kbps SPC, but the cost is reduced a little when multiple SPCs are ordered. 0 - 12 km 12 - 25 km 25 - 50 km 50 - 100 km SPC 50 - 165 km timed Microlink XSPC & $2,172 $3,204 $5,940 $9,468 Macrolink SPC On Ramp timed call $10,080 $41,264 $85,454 24 hr x 365 day On Ramp timed call $4,212 $17,240 $36,629 45 hours a week during business hours [Christine Groh didn't think that these large figures for 24 hour a day times calls were relevant, since no-one was using it like this, but I put them in to give a benchmark for what the "Express package" should work down from.] OnRamp voice call charges are not subject to residential discount schemes. Christine Groh, Telstra's Principal Product Manager for ISDN, explains that OnRamp ISDN is currently targeted at business users, and so the business flexiplans are applicable - for voice calls only. For data calls, she said that many customers would be well served by the SOHO and Premier OnRamp packages, which include $20 and $180 per month of local data calls respectively, for monthly rentals of $70 and $200. [Telstra marketing and managment people are often seriously into segmenting and targeting the customer base. It does not seem to trouble them that a "business product" and a "residential product" could be based on exactly the same physical technology and have the same or similar cost structures, the fact that the "product" is targetted at the divisions of customer-space that Telstra perceives makes them totally different things.] In July, Telstra intends to announce an "Express package" of OnRamp tarrifs to reduce the overall costs faced by customers who make long data calls. Groh said that this package would cover 128 kbps between certain nominated points, and be easier to administer than XSPCs. She said "The Express package is highly likely to suit customers who are heavy users", but will not compare favourably with the XSPCs for 24 hour-a-day connections. The Express package will apparently involve a "pay as you go" arrangement with a ceiling on charges per month - rather than pre-paid SPC and XSPC charges. She explained that Telstra was configuring the service to suit the majority of customers and did not want to encourage ISDN to be used for permanent links. [It was too early to find out anything more about this "Express package". It seems contradictory to say that the package will involve a ceiling on charges (which it was explained would protect customers who accidentally left their equipment connected for long periods) whilst saying that it would suit 7 - 10 hour/day users better than 24 hour/day users. I did not query this contradiction - they were still figuring out what the "Express package". involved.] Australian ISPs have found ISDN, with XSPC tarrifs, to be ideal for linking to their upstream provider, but Groh suggests that they should use an alternative in the future - such as DDS Fastway. This reliable service costs $3240 pa. per site, plus traffic charges starting at $1641 pa. for 64 kbps up to 12 km. David Brooks, Telstra's Senior Product Manager for Dedicated Network Products said that XSPCs are currently used by ISPs and by customers wanting WAN and/or compressed voice connectivity. While acknowledging that more work needed to be done on the "Express package", he said it was unlikely to favour customers who used their links more than seven to ten hours a day. He added that "Over time, new and existing Telstra leased digital products would be positioned as a more attractive option for customers who need permanent links." [Anyone concerned about the demise of SPCs should contact David Brooks - I found him to be very communicative. Email me for his contact details.] HFC cable modems are ideal for providing such permanent connectivity, but it seems that Telstra does not yet have concrete plans to use them in this way. [This may change. I will be doing a full article on this for the August issue.] ISDN can be used to link TCP/IP traffic at 64 kbps via a local data call from anywhere in Australia - with the traffic from multiple remote users being concentrated to a single site via Telstra's Frame Relay network. This "Dial Connect" service and a similar soon-to- be-announced service for any kind of data will be discussed in next month's issue. ** Conclusion With the demise of XSPCs, many ISPs will be looking to alternative technologies and carriers - unless Telstra's "Express package" is more attractive than currently anticipated. It seems strange to close down the growing market for using ISDN for permanent data connections. Customers would be tempted to use two or three analogue modems on permanently held calls. For Telstra, the resulting revenues would be comparatively slim and the customer would prefer to be using ISDN - and so tying up one inter-exchange 64kbps link rather than two or three. This file is http://www.firstpr.com.au/telco/articles/spc.txt Robin Whittle rw@firstpr.com.au http://www.firstpr.com.au