IP: an oped from Les Vadasz pub in SJMN -- Making PC

[David Farber <farber () cis upenn edu>]

Making PC Communications Services a High-Priority Issue
By Leslie L. Vadasz
Senior Vice President, Intel Corporation




        In the great race to overhaul telecommunications regulation, craft the
next telephone industry merger, and deploy the latest wireless technology,
the needs of personal computer users are being overlooked.  Indeed, in the
supply-centric world of telecommunications, consumer demand for PC
communications services has been, at best, an afterthought.  It's high time
for a change.
        Last year's Telecommunications Act substantially updated communications
law for the first time in more than six decades.  The computer industry
supported this legislation because it promised less regulation and a
market-driven business environment.  Our industry had learned long ago that
competition speeds technology - in the form of increasingly desirable
products and services - to consumers. =20
        The industry also was aware that computer users had become increasingly
dependent on network connections and, accordingly, were becoming more and
more limited by the old communications technologies and services offered by
local telephone companies.  Indeed, today's computer communications are
hindered significantly by the telephone network:  sending information from
one PC to another via the best modems (which are forced to use old analog
voice phone lines) is like filling a cup drip by drip, rather than from an
open faucet.
        So, perhaps naively, we in the computer industry expected that the new law
would usher in a new age, where rapid diffusion of advanced digital network
technologies would complement and eventually match the power of the
computers that consumers are buying.  Well, this has not happened in the
year since the Act was signed.  And, given our current course, I am not
optimistic that it will happen any time soon.
        The problem is obvious.  On one hand, there are many household services
that consumers can purchase.  For example, every home in America has at
least one energy service such as electricity, gas, or oil.  About 95% of
homes have telephone service.  Almost 100% have broadcasting service.  And
about two-thirds have cable TV service.
        Yet amazingly, in the midst of the Information Age, consumers are not able
to purchase a reasonable PC communications service.  This is in spite of
the fact that about 40 percent of U.S. homes (about 40 million) have PCs.
Although many home computer users employ modems to communicate via the
voice telephone network, make no mistake: this is a wholly inadequate
substitute for true PC communications services.
So what are these PC communications services?  Current telephone and TV
services have fundamental characteristics and a range of service options.
Telephone is designed to provide real-time voice communications over great
distances, but merely requires simple analog user devices.  TV service is
offered in a range of prices and features, from the most essential (local
broadcasting supported by advertising fees) to the most advanced
(pay-per-view cable and satellite offerings).  Consumers should expect a
similar situation for PC communications services.
=09


The fundamental characteristics of these PC services should be:


=B7 High bandwidth.  Multimedia information requires high-speed connections
that can carry bits quickly.  While there are many high capacity lines
connecting cities, the connections to our homes are woefully inadequate.
=20
=B7 Instant access.  Today's PC modem connections take about two minutes to
set up and connect.  This is unnecessary and unacceptable.  Can you imagine
having to wait that long to connect to a TV channel?
=20
=B7 Plug-and-Play.  It should be very easy and fast for users to order and
begin using a new package of services.
=20
=B7 Multimedia integration.  Voice, video, and data communications should be
melded seamlessly for individual users and groups of users.
=20
=B7 Store-and-Forward.  Functions such as voice mail, fax, and e-mail should
be enabled.
=20
=B7 Security.  PC transactions must be reasonably protected from intrusion,
particularly for electronic commerce and workplace applications.
=20
=B7 Affordable pricing. There is no reason to price PC communications
services on an expensive, time-metered basis.  A combination of flat-rate
and service-specific pricing - for a total charge to consumers on the order
of their cable TV or phone bills - would be appropriate. =20
=20
The range of PC communications services will grow over time.  Some of the
more urgent needs are for:
=20
=B7 Internet access.  The Internet has become a fundamental communications
medium that provides multimedia data anytime and anywhere.
=20
=B7 Broadcast data.  Many consumers will want news and other information
services delivered to them in a timely manner.
=20
=B7 Telecommuting.  Today's workplace connections are relatively inefficient=
.
 Technology can dramatically improve the effectiveness of working outside
the office.


These new services will bolster the economy.  Indeed, prognosticators'
visions of the Internet's glorious and economically beneficial future
depend upon the fundamental telecommunications infrastructure defined by PC
communications services.  This infrastructure, of course, could be used by
a variety of proposed Internet appliances and other network devices, if any
of these become practical.  Further, this infrastructure has its own
economic potential for those that provide services and related equipment.
Conservatively, well over $10 billion in annual revenue potential exists
for basic PC communications services alone!  To be sure, significant
investments by both consumers and providers will be necessary, but the
revenue potential is high enough to justify their investments.
There are other issues, of course, such as sorting out the bugs in existing
telecommunications technology.  And the implementation of PC communications
services will take time.  However these impediments are not reasons to
stall.  The concept of PC communications services is an idea whose time has
come.
So what should government do?  Although Congress considered some of these
issues during debates leading to the Telecommunications Act, the
telecommunications industry, unfortunately, is not moving in this
direction.  The local and long-distance telephone companies  are reacting
to the new law by trying to get into each other's business while defending
their current business.  However, even this may be delayed as new FCC rules
are appealed. In the end, consumers will save a few dollars on their
telephone and TV bills, but they still will not have decent PC
communications services.  Sadly, the new legislation has become the
foundation for dividing the existing market, rather than spawning new=
 markets.
I believe that our federal and state governments should make PC
communications services a high-priority issue that is used to guide
specific decisions such as the current examination of Internet access and
the ongoing interconnection and competitive entry rulings. Actions that
legislators, executives, and regulatory bodies take should be evaluated by
asking: How will this action help establish PC communications services?
What will telecommunications providers do to deploy appropriate technology
and offer services?  How will we realize the economic growth that these
services allow?  How can we foster a competitive environment in which
service providers, using different technologies (such as telephone, cable,
and wireless), can compete effectively for consumers' dollars? =20
Of  course, policy-making by itself is not enough.  It will require
effective cooperation between the computer and telecommunication industries
and government to provide the kind of services that consumers want.  If we
are successful, we finally can shift the focus of PC communications
services to creating the real information infrastructure, which can only
have a positive impact on our economy and our national competitiveness.




 =20