Throwing FUD at Qwest

Network World, 02/08/99

The Network World Frame Relay Showdown at ComNet/DC '99 pitted seven carriers - the Big 3 plus US WEST, Intermedia, Infonet and Qwest - against one another.

As we've reported, technical issues got a good workout. But also at the forefront were political issues - especially those threatening the smaller carriers with our old friends fear, uncertainty and doubt.

Michael Johnson, Intermedia's senior director of enhanced engineering, was asked if his company's strategy of linking local regional Bell operating companies' frame relay clouds would become obsolete if the RBOCs were authorized to enter the long-distance data business. He said absolutely not.

"Networks can't be built overnight," he said. RBOCs would have to hang onto their Intermedia connections even as they built out their own far-flung packet networks, he said: "The number of frame relay switches is just too extensive out there. No one carrier can duplicate it." Besides, Intermedia and the RBOCs often price frame relay at half the cost of long-distance carriers' offerings.

Brad Hokamp, Sprint's director of advanced data services, defended the pricing patterns. The cost of new fiber that's laid to carry increased demand has to be recovered somehow, he said. Then Hokamp and other panelists went after one of the lowest-cost providers, Qwest.

One of my showdown partners, Atul Kapoor, senior vice president of The Tolly Group, noted that the Big 3 all have well-established managed router programs, but Qwest doesn't, raising questions about the company's experience even among users who don't necessarily want managed contracts.

"We do run into that often," said Mack Greene, Qwest frame relay and ATM product manager. But he added that Qwest's prices are 30% to 40% below those of the Big 3. He also noted that Xerox's professional-services arm, XeroxConnect, provides managed frame relay for Qwest under a partnership agreement.

Hokamp noted that Sprint has a 20-year track record as a data specialist. But Greene turned the issue on Sprint, saying that over the past year, Qwest has hired dozens of engineers away from Sprint and other large carriers. Greene then seized on the question of voice over frame relay, noting Qwest doesn't have an installed base of circuit-switched voice customers to cannibalize. Here's where Qwest's fat pipes - up to OC-12, or 622M bit/sec, and eventually higher - come into play.

Most frame relay carriers oversubscribe their frame relay networks. Just as airlines and hotels overbook in the expectation that some people won't show up, frame relay carriers generally allow multiple customers' virtual circuits to be assigned to routes in the backbone, figuring that data application traffic is inconsistent and varies throughout the day. But if users start making phone calls over such a shared network at peak business hours, the net could crash.

In Qwest's case, the fat pipes - and the fact that frame relay runs on Qwest's single frame/ATM backbone network - means "we're able to keep oversubscription to zero on the backbone," Greene said. "That gives us a leg up."

Can that counter the FUD from the big carriers? It'll be fascinating to find out.