TELECOM 99 confirms 'must do' reputation for communications industry

Dec. 1, 1999

The organizer of Telecom 99 + Interactive 99, the International Telecommunication Union (ITU), promised visitors a "walk into the new millennium" to the communications supplier and operator titans who descended upon the city of Calvin--Geneva, Switzerland. With more than 1000 exhibitors filling the nearly 700,000 sq ft (65,000 sq m) of the Palexpo exhibition center, the ITU was undoubtedly pleased with its prediction, as a turnout of more than 200,000 attendees walked the show floor during an eight-day period Oct. 10 to 17.

The ITU has pumped this giant telecommunications conference to the physical limit. The estimates of exhibitors' combined budgets are put at more than U.S. $2 billion. This year marks the eighth ITU-Telecommunciations version of this event, and ITU has just announced that the next ITU-Telecom 2003 will return again to Geneva. Of course, this decision requires the expansion of Geneva's center, Palexpo, with an additional exhibition hall.

Telecom 99 was a showcase for optical networking. This technology shared the podium with other more future-oriented telecommunications promises--convergence of legacy systems (e.g., mobile and fixed, voice and data, and everything toward Internet-protocol [IP]-centric networks). In the words of Yankee Group Europe's Graham Finnie, "The ITU finally 'gets' the Internet and hastily convenes an event at which Internet pioneers mock the telecom industry."

Three of Finnie's milestones concern the paradigms of the optical-networking market at the beginning of the new millennium.

  • The buying spree of the dominant carriers: MCI WorldCom's bid for Sprint and the acquisition of Racal's UK national long-haul network by Global Crossing were the news-de-jour during Telecom 99. The remaining owner of Global One was also hotly speculated during Telecom 99, with France Telecom as the promising victor over Deutsche Telekom or Sprint.
  • Deregulation in Europe: The on-going unraveling of the pan-European alliances (UniSource and Global One) and the rise of market presence of alternate carriers betting on pure IP-centric networks (e.g., Interoute, Global TeleSystems, Level 3/COLT Telecom, and KPN/Quest).
  • The commercial deployment of DWDM: With the similarity of Moore's Law in semiconductors, both former post, telegraph, and telephone (PTT) and alternate carriers are deploying long-haul broadband networks that permit an ongoing major price erosion. Finnie predicts that "no one yet knows what a year-on-year fall in long-haul bandwidth pricing of 60% or more will do to industry's economics."

Some of the leading dense wavelength-division multiplexing (DWDM) suppliers--Lucent, Alcatel, Nortel Networks, and Ciena--reported major contract awards involving DWDM network deployments across all major geographical markets. Since 1995, telecommunications regulators in the United States, Canada, Australia, Europe, and Japan have set loose the race to deploy cost-efficient DWDM network with the advent of cheap IP pricing. Ryan Hankin Kent (RHK Inc.--South San Francisco) reports that the Telecom 99 conference was designed to explain this market trend and tie the migration to DWDM networks with the Internet explosion of IP traffic. Stephane Teral, RHK analyst, sees "that there are basically two massive changes since Telecom 95: the implosion of regulation and the explosion of the Internet."

While an optical-networking showcase did not dominate Telecom 99, the importance of DWDM networks to permit the Internet revolution to move to Phase 2 was much in evidence with the key network suppliers.

Telecom 99 was also crowded with a flood of announcements concerning the undersea fiber-optic cable systems. Kurt Ruderman, KMI Corp. (Newport, RI), mentioned that the company's 1999 forecast predicts submarine cable deployment to flourish, a trend expected to continue in the foreseeable future. The DWDM migration is also slashing the capacity pricing of future networks and even reducing pricing on current operating transatlantic links. Some notable system announcements were:

  • Pangea and Iaxis (formerly called Telemonde) announced their multimillion-dollar plan for a transatlantic submarine network as the latest entry into this market.
  • TAT-8 will retire ahead of planned schedule by 14 years due to a noncompetitive maintenance situation.
  • Global Crossing plans to add 80 Gbits/sec to PC-1 cable within one year.
  • FLAG and GTS plan to double Flag Atlantic-1 capacity to 2.4 Tbits/sec, with initial capacity available in 2000.
  • Project Oxygen has also scaled up its initial plan to 100 Gbits/sec, with deployment by 2000 and 2003.
  • France Telecom will lead its SEA-ME-WE 3 to deploy 10 Gbits/sec, with the planned links in Southeast Asia, Europe, and the Middle East.

The lavish spending of the world's telecommuncations titans continued after the daily exhibition closings well into the night, with nonstop parties and dinner banquets. Telecom 99's entertainment circuit was opened with Cisco Systems linking with one of ITU's sister United Nations agencies, UN Development Programme for NetAid. The two sponsored a record-breaking Web happening--three overlapping concerts on Oct. 9 with world class artists in New York, London, and Geneva broadcast around the world via the Internet. The event required Cisco to deploy a worldwide network that handles one million hits per minute. The network permits more than 125,000 simultaneous streams of 28-kbit/sec and 56-kbit/sec video.

Edward Harroff writes on telecommunications issues from Bellevue, Switzerland.