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Dynamic T1 Services Take Root
Thursday September 11, 2008,
09:46 am ET
TRACE, Kentucky, Sep. 11 /Jason Young/ --
Business broadband, its price, and who can afford it, are changing. Every day an increasing number
of business are finding the new broadband services made available to them by the "new" telecommunications
companies that are emerging from the latest round of mergers and acquisitions. Overlapping networks
are being consolidated into bigger and leaner footprints, lowering the cost of dynamic integrated
digital signal 1 (DS1) service to the price range of about five regular phone lines. Small to medium
size business can now afford services once reserved for the Fortune 1000 companies.
There are two basic "integrated" DS-1 configurations, analog and digital. The 24-line
bundle in which they come is termed a "trunk". The main difference between analog and
digital trunks is their flexibility. With digital trunks, voice lines not in use
can be dynamically reconfigured to carry data traffic, so they don't sit idle.
Analog trunks on the other hand can not change their function once configured
by the service provider. Data channels remain data channels and the same for
voice channels, even if there is no voice traffic.
At $50 to $75 per month, the average small business telephone customer could expect to pay
up to $750 for just 10 regular phone lines, which come with only a standard set of features
such as Voicemail, Caller ID, and Three-way calling. From 2000 to 2005, the cost of a
dynamic integrated T1 line was well over $800, making it an unattractive option from a
pure cost point of view. However, that paradigm has changed with the introduction of
sub-$400/month price plans and features that make the old POTs lines look pre-historic.
Adoption of new technologies take time, and dynamic integrated T1 service is no
different. Since the telephone service is regarded more as a utility than anything,
business pay very little attention to changes in the industry. Significant price
reductions and incentive packages need to be placed on their doorstep by proactive
consultants and telecom salespeople in order to grab their attention. However, once
the new technology begins becoming commonplace in the industry, momentum builds
and soon the new products become standard. Businesses soon see themselves at a
disadvantage to their piers if they don't adapt and keep up.
Change does not happen quickly in an industry as so heavily regulated as Telecommunications.
Recent industry consolidation has provided huge alternatives to the incumbents, who
are now under pressure to keep up with new technologies while charging better prices
to retain and attract new customer bases.
The recent progress made by CLECs leaves us thinking in hypotheticals. "What if the
Clinton administration wouldn't have passed the Telecommunications Act of 1996, requiring
RBOCs to lease their lines at reduces rates to the CLECs?" "Will the FCC continue to
enforce this law, or will it be overturned by the powerful AT&T and Verizon lobbyists?"
It is impossible to know either way, but for the time being we can just be grateful
that the industry has evolved to the point were small businesses can actually benefit
from telecommunications at an affordable rate.
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