My keynote address at the 2003 Spring VON conference, presented on April 1, 2003. I pointed to real 100/100 Mbps Internet connectivity (deployed in 1999-2000, in Ulmea Sweden) emphasizing this was only possible by getting control of local fiber away from the incumbent PTT.

1. The Long and
Winding Road
Brough Turner
Senior VP & CTO

2. VoIP over FTTH
Newton Corner Fiber Project
78 homes mixed 1- and 2-family neighborhood
0 90+%participation along deployment route
0 Community organization - volunteers
0 Commercial contracts for all outside work
Ethernet over buried multi-mode fiber
0 Fiber, construction and 100 Mbps equipment costs
less than $2000 per household
0 130 days from construction start to live service
45 Mbps link to the Internet
0 Monthly service cost: $24 per household
April 2003 Slide 2

3. Sorry, April Fool’s Day...
but
Similar project in Ulmea, Sweden completed
in the winter of 1999-2000
0 Buried fiber (and coax and
6 twisted pairs)
0 60 out of 62 single-family
homes participating
0 10/100 Mbps electronics
0 66 MHz link to Internet
Costs per household
0 one-time: <$2000
0 recurring: $10/month
http://mg0703.ersboda.ac/tomas/mattgrand/index.shtml
April 2003 Slide 3

4. VoIP Today
We’ve won the battle for Mind Share!
But...
89% of international traffic is still TDM
Most local voice traffic circuit-switched TDM
Most installed PBXs are circuit-switched TDM
0 In 2002: 82% of new PBXs were not IP-enabled
All mobile voice services are circuit-switched
Convergence will be a twenty year process
with substantial progress in next few years
April 2003 Slide 4

5. Mind Share is Important
VoIP Adoption
100
90
80
70
60
50
40 We’re about here
30
20
10
0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
April 2003 Slide 5

6. VoIP
A Product, Not a Service
Remember Federal Express ZapMail?
0 New (1984), fast (2 hour) document delivery service
based on Group 4 Fax, but
0 People purchased their own Group 3 Fax machines
0 G3 Fax leveraged the existing telephone network
VoIP telephony will become a product,
not a service, eventually...
0 Utilizingthe Internet, and evolving Internet
directories (like ENUM)
0 Accessing old phones via gateway service means
long transition interval...
April 2003 Slide 6

7. Boring VoIP
IP telephony being treated as an incremental
improvement
0 Better cheaper telephone service
Internet has been disruptive everywhere else
0 Email
0 WorldWide Web
0 New approach to community, identity & information
Why should telephony
be any different?
April 2003 Slide 7

8. Disruptive VoIP
Push-to-Talk Voice Instant Messaging
Don’t try to compete with Nextel
0 Focus on teenagers
0 Test it with gamers
0 Combine with ideas on my next slide...
Drive device technology to best leverage
available service infrastructure
0 insupport of disruptive uses
0 Test clients for PCs, Palm, Blackberry & other
WLAN devices, and 2.5G/3G mobile handsets
0 Focus on a device offer, not a service offer
April 2003 Slide 8

9. Disruptive VoIP
Always-On Workgroup Conferences
VoIP microphone always on-line to a
word-spotting speech recognizer
0 “Hey Brian are you there?”
0 Recognizing “Brian” causes the spoken phrase to
be forwarded to Brian’s handset and an immediate
conversation to ensue
0 Half-duplex, and 1 second latency is OK!
0 VoIP can work well today
Has the potential to redefine what we
mean by telephony...
a.k.a. the Star Trek Communicator
April 2003 Slide 9

10. Historical Perspective
Early British Railroad Development
RR construction authorized by Parliament*
0 Miles of track; Capital in millions of pounds sterling
Year Miles Capital Year Miles Capital
0 1833 218 5.5 1842 55 5.3
0 1834 131 2.3 1843 90 3.9
0 1835 202 4.8 1844 805 20.5
0 1836 955 22.9 1845 2,896 59.5
0 1837 543 13.5 1846 4,540 132.6
0 1838 49 2.1 1847 1,295 39.5
0 1839 54 6.5 1848 373 15.3
0 1840 0 2.5 1849 17 3.9
0 1841 14 3.4 1850 4.1 70.4
* Andrew Odlyzko, U of Minn., private correspondence
April 2003 Slide 10

11. Long History of Techno Bubbles
Overinvestment and Crashes
5000
4000
3000
Mileage
2000
1000
0
33
35
37
39
41
43
45
47
49
18
18
18
18
18
18
18
18
18
Railways authorized by British Parliament (not necessarily built)
< http://www.dtc.umn.edu/~odlyzko/talks/index.html >
April 2003 Slide 11

12. 19th Century British Railroads
Investor attitudes in 1840 & 1850 were
extremely negative, but ...
More than 70 years of steady traffic growth
0 depressions had only slight effect on growth rate
Cycles of financial investment
0 “Irrational
exuberance” to near zero investment
0 Many bankruptcies, but…
No serious interruption of service!
Over long term, many fortunes were made
0 and some were lost
April 2003 Slide 12

13. Internet Backbone Traffic in U.S.
Roughly doubles every year (90% in 2002)
Consumer getting some Moore’s law benefit
TB/month (in Dec)
1000000
100000
10000
1000
100
10
1
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002
Traffic (low est.) Traffic (high est.)
Based on data from A. Odlyzko, U of Minn.
Where do we focus to best advance VoIP ?
April 2003 Slide 13

14. Access is the Bottleneck
1000-to-1 disconnect !
Voice
E-Mail Internet
Broadband & other
Local Loop
Ethernet Modem
ERP Public IP
LAN or 1.5 Mbps ?
Access Services
Switches
Sales Gateway
Finance
Video Gigabit Ethernet
Enormous Long-
10/100/1000 Mbps Haul Bandwidth
Ethernet
April 2003 Slide 14

15. Broadband Adoption Rates -
Outpacing Cellular Adoption Rates
200
180
Connections (millions)
160
140
120
100
80
60
40
20
0
2001 2002 2003 2004 2005 2006
United States Western Europe Asia Pacific Rest of World
Source: IDC, January 2002
April 2003 Slide 15

16. Obvious Vested Interests
Traditional telco sells voice services
0 email and web browsing represent new revenue,
but VoIP threatens voice revenues
Cable company makes money on TV
0 email and web browsing represent new revenue
0 VoIP could be a new service (at telco prices)
Wireless service providers sell voice mobility
0 lookingfor data services where they can “capture
the added value”
0 browsing by the kilobyte, if at all
April 2003 Slide 16

17. The Real Problem
First Mile Right-of-Way
Many long distance right-of-way alternatives
0 just look at all the national and international
backbones that have been built
Limited space in local rights-of-way
0 part of justification for original telco monopolies
was reduced overhead wiring clutter
0 already have water, sewer, electricity, gas, phone &
CableTV organizations digging the street…
0 long, and different, regulatory history for each
Fiber could replace both phone and cable TV
0 big, big, long and nasty fight ahead...
Photo by Dr. William T. Verts, http://www-unix.oit.umass.edu/~verts/things/things.html
April 2003 Slide 17

18. What Do I Want?
User ownership, or control, of first mile fiber
0 from my house or business to an aggregation center
where alternate IP service providers are available
How might we get there?
CLEC access to first mile right-of-way
0 on equal terms
0 if nothing else, biz & home owners partner with
CLECs for local fiber builds and fiber maintenance
Municipal provision of first mile fiber
0 fiber only, to aggregation center where competitive
carriers are available
April 2003 Slide 18

19. Interim Alternatives
Ethernet & other Layer 2 services
0 To aggregation center with competitive ISPs
Wireless bypass !
0 WLAN volumes driving prices down performance up
0 Vivato WiFi switch & directional antenna provides
33 Mbps over 4 km outdoors; 50 km pt-to-pt
0 Higher capacity links costly, but available
0 Meshes are robust way to connect many parties
back to a few fiber access points
0 Unlicensed spectrum simplifies local user and
community activities
Image © Telex Communications, Inc. (www.telex.com)
April 2003 Slide 19

20. Regulatory Competition
The Internet is global
Regulation is national, regional and local
0 From the EU regulators in Brussels to local city
governments controlling local rights-of-way
Threaten politicians: “others are ahead of us”
0 Korea and Japan lead US in broadband per capita
0 Asia and Europe lead US in cell phone services
Is it enough? to get fiber to my home???
0 Time will tell
Meanwhile, I’m looking into wireless bypass...
April 2003 Slide 20

21. Enormous Opportunity Ahead
VoIP Adoption
100
Continuous gains in 90
underlying technology 80
70
6B humans, 2B phones 60
Convergence means 50
We are here
40
replacing today’s phones 30
20
Substantial, long term, 10
0
worldwide growth! 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Significant positive
impact on humanity
Have Fun - Make Money !
April 2003 Slide 21

22. N M S CO M MU N I C A TI O N S
Technology for tomorrow’s networks