Datapro Report

Better Backbones to Shoulder Bigger Network Burden

Michael Smith

Developments in the Internet service provider (ISP) marketplace will continue to unfold at a lightning pace over the next year. The activities of major service providers have centered around four areas: expanding the geographic reach of ISPs' Internet backbones, upgrading backbone capacity, delivering enhanced levels of service performance, and adding new services, including Web-site design, Web hosting, and content creation.

Better backbones are already needed. Meanwhile, demand for bandwidth might increase as on-line services, such as America Online, Prodigy, and, Microsoft Network offer flat-pricing schemes ( see the table ).

A snapshot of activities in 1996 and proposed activities for 1997 high light how the major ISPs are positioning themselves to offer value-added services for businesses:

Concert. At first, this was an international joint venture between Washington, D.C.-based MCI and London-based British Telecommunications (BT) to offer virtual network services. But MCI and BT will now merge and form a new company called Concert plc. Plans include expansion of the companies' Internet networks to include 20 Internet superhubs around the world. Concert will provide ISPs, telecommunications carriers, and businesses with Internet/intranet transport and access services on an international basis.

Pacific Bell/IBM Global Network. IBM (Armonk, NY) will install high-speed links between its international backbone and the network of Pacific Bell (San Francisco).

Cable & Wireless. This Vienna, Virginia-based interexchange carrier will add Web services, such as home-page design and hosting services, to NetWorth, the company's Internet product package, and expand its number of network-access points worldwide.

Internet Thruway. Northern Telecom (Raleigh, NC) is working to transfer data and Internet connections of long duration from the traditional voice network to a packet-/cell-switched data network. Thruway consists of adjunct switches that work with a telephone central office to alleviate the strain of Internet traffic on the public-switched telephone network.

Diamond.Net. The St. Louis-based Diamond.Net is constructing a private, managed fiber-optic and satellite network using asynchronous transfer mode (ATM) and SONET/SDH technology to accommodate the demands of a new generation of network services.

MFS, UUNET, and the World. MFS (Omaha, NE) had barely finished announcing that it would acquire UUNET when it revealed plans to merge with WorldCom (Jackson, MS). The plan for MFS and UUNET was to leverage MFS's extensive fiber facilities with UUNET's line of Internet products and servic es to offer businesses a range of Internet-access services. Now, with the addition of WorldCom, the combined company will offer local, long-distance, and Internet services.

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On-Line Service Charges

Consumer time on-line should increase due to flat pricing schemes.

Service          Initial cost          Additional hours     Free trial period
                  per month

America Online   $19.95 (unlimited)     Does not apply      15 hours; $2.95 for
                                                            additional hours

CompuServe       $ 9.95 for 5 hours     $2.95 per hour      10 hours; $2.95 for
                 $24.95 for 20 hours    $1.95 per hour      additional hours

Microsoft        $ 6.95 for 5 hours     $2.50 per hour      30 days
Network          $19.95 (unlimited)     $2.00 per hour

Prodigy          $19.95 (unlimited)     Does not apply      First month

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Michael Smith is lead analyst, network services, at th e Datapro Information Services Group. For more information about the full report, call (609) 764-0100 or contact http://www.datapro.com .