US firm looks to sell xDSL to local service providers

Although Telecom is trialling ADSL for the consumer market, DSL deployment doesn't have to be carried out on such a large scale. US communications equipment company Paradyne has entered New Zealand, aimed initially not at telcos but at service providers wanting to offer xDSL-based services to business customers.

Although Telecom is trialling ADSL for the consumer market, DSL deployment doesn't have to be carried out on such a large scale. US communications equipment company Paradyne has entered New Zealand, aimed initially not at telcos but at service providers wanting to offer xDSL-based services to business customers.

Paradyne, a 30-year-old company acquired by AT&T in the early 80s and sold again in 1996, manufactures DSL modems and access multiplexers. It also provides consulting services on the market and advice on how to sell DSL-based services. Hamilton-based network service provider Lloyd Communications has been appointed local distributor.

"We're going to start off small, aiming at business customers," says Lloyd managing director Lloyd Gallagher. "In particular we're looking at things like hotels [The Sheraton in Sydney uses 3Com DSL gear to provide a raft of services to guests over the hotel's phone lines], and security companies that spend a lot of money on monitoring."

Such deployment follows the "Shared Tenant" business model, where service providers put a DSL access multiplexer (DSLAM) into a building to provide high-speed bandwidth services to tenants, either business or residents.

In New York, Paradyne is working with Thorn Communications which, in conjunction with ISPs, has put a DSLAM into the basement of a high-rise building with nine business tenants. Thorn offers high-speed Internet access at 2.56Mb/s to the tenants for a total of $US500 a month. It also targets residential customers in another high-rise with each resident using a DSL modem.

Paradyne business development director John Freeman says the shared tenant model avoids the need for interconnection agreements with the local carrier but the service provider has to negotiate with the real estate owner.

Other business models are "Direct PTT" under which the telco or competitive carrier provides DSL services to the customer by placing a DSLAM on the local loop; or the "PTT Transport" model whereby the telco provides the transport mechanism and third-party content providers are the customers. The advantage of the transport model over direct is that the carrier doesn't have to fill out a full menu of content and services, says Freeman.

In the US, Paradyne is working with customers to deploy all three models.

Freeman says Paradyne provides consulting services on ways to sell DSL-based services. "It's up to us to educate providers on how to make money from this technology."

Looking at market requirements, he says businesses want the following:

• Speed has to be tiered and the provider has to be able to offer speed in 64Kbit/s increments. Rate-adaptive DSL and MVL (both DSL technologies deployed in Paradyne products) allow that. Speed has to be matched to the company's applications.

• Both symmetric and asymmetric DSL will be required. RADSL allows faster downstream speeds than it does upstream. Other applications need both down and upstream speeds to be equal.

• Advanced security features.

• Scalability and manageability. Customer knows they can work their way up as bandwidth needs increase.

• Support for multiple users. The system has to be able to manage many IP addresses.

• For businesses, cost is less of an issue. People will pay for what solves their business problems.

"To start with, most providers are targeting the business market but the consumer market is really the home run," says Freeman. "It's more difficult because it is a mass market and it has to be able to scale. The big application in the consumer market is Internet access."

Requirements for the consumer market are:

• Easy to use.

• Easy to install by end-user customer.

• Auto-configuring. A DSL modem has to act, feel and look like a dial-up modem.

• At least 384Kbit/s symmetric operation.

• Modem cost less than $US200 (same as a dial-up modem).

• Service cost less than $US50 a month.

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