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Industry Backgrounder
Telecommunications: Communications “at a distance” for 125 years
For the entire 20th Century and for some years before, the world’s fixed line telecommunications networks, public and private, were built using technologies designed for voice communications, referred to as telephony.
In the 1960s, the use of computers grew rapidly and heralded the era of digital communications to the present day, during which time data communications in all its guises has become the dominant use of telecommunications networks – certainly in terms of expenditure.
The history of mobile (cellular) networks has followed a similar pattern, but over a much compressed timescale of just 20 years.
Telephony-based telecommunications is far from ideal when it comes to data communications, resulting in much compromise, the necessity of additional equipment (and, hence, expenditure) and the inefficient use of telecommunications resources generally.
Starting in the 1970s, the data communications industry, driven by the computer industry, developed its own communications technologies and standards that have stood the test of time. These include Ethernet and IP (Internet Protocol). They have continued to be developed right up to the present day to match the explosive demand for speed and bandwidth required not just by computer applications and particularly the Internet, but increasingly video communications including broadcast TV.
In parallel, the telecommunications industry has been developing new high speed access technologies to its networks including DSL (commonly known as “broadband”). Wireless broadband is also now becoming available to access the mobile networks in support of “triple play” applications delivered to a single end-user device (telephone, Internet and TV).
All these developments are often collectively referred to as “convergence” with Fixed Mobile Convergence (FMC) being one of the most significant commercial developments in the industry at this time.
Medium and larger commercial and public organisations have typically built their own private communications networks over the years to complement the services of public networks. These have invariably been separate voice and data networks, albeit sharing common basic resources where possible.
We are now witnessing the final major piece of the convergence jigsaw. This is the re-engineering of core infrastructures of public and private telecommunications networks to support real time multimedia communications (voice, data & video) natively. This is being achieved through the deployment of pure IP switching and routing over very high speed optical, “copper” and radio transmission systems that are application independent (transparent).
These new fully converged networks are referred to as “Next Generation Networks” (NGNs). They require substantial investment. Between 2005 and 2015 national public network operators will be spending up to billion each (typically bn-bn) and larger corporations up to million each (typically m-m).
Rarely will such change be implemented as a one-shot project. For most, migration over several years is the only practical approach to achieve a “pure IP” communications infrastructure.
However, once achieved, the benefits to all are considerable and centred around corporate efficiencies, business agility and customer responsiveness through the:
lowering the overall Total Cost of Ownership (TCO) of communications – up to 50% annual savings on a like-for-like basis;
introduction of flexible working for the entire workforce as required;
rationalisation and consolidation of premises anywhere and everywhere;
improvement in customer service by enabling all staff (and customers themselves) to access any type of information or undertake any form of transaction from wherever they are at any time;
facilitation of fundamental process re-design and optimisation – including “right shoring”; and
optimisation of supply chain / demand chain management.
If one were to distil all the above down to, say, just two crucial enablers, they would be:
the use of IP (and its associated standards) for all types of communications; and
the advent of true mobility (the “Martini effect”: any service, any time, any where).
It is clear then that supply side businesses in the communications marketplace, with the skills, technologies, products and services that address the needs of migration to convergent communications solutions, especially in the areas of IP and wireless, have
every possibility of becoming highly successful over the coming decade.
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