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The “IP Transition” and the FCC Push begin the Migration Away from TDM

By Al Brisard, VP of Sales, Marketing and Business Development, Vertek Corporation

Voice communications is well on its way toward making a major transition from time-division multiplexed (TDM) circuit-switched services to all-Internet Protocol (IP) – a process often referred to as the “IP Transition.” It started long ago in the area of long haul or inter-office communications.  Over the last several years the many endpoints at both residences and businesses have migrated to some form of VoIP, whether it is hosted or premise-based.  And of course there is the adoption of SIP trunking that can interface to either a TDM or IP-based premise solution.

The Next Wave
The last major grouping of legacy TDM is in the area of Class 5 Switches. These are the incredibly reliable but costly set of digital switches located in the central offices.   These switches represent a massive investment that carriers are not predisposed to replace any time soon, especially since they work.  However, over the last several years many carriers have seen the parts and manpower costs to maintain this equipment rise dramatically while the customer base being served is declining. Thus, this dynamic, coupled with the pressures from the FCC, increases the urgency for carriers to proactively accelerate the IP Transition while maximizing customer retention.

To this end, carriers have begun to aggressively plan for the replacement of their legacy networks with IP network services.  Although the immediate revenue impact might be negative for a like-for-like transition, significant new revenue opportunities will become available to carriers once customers are served by an all–IP network. This type of transition is not simple, given the number of service types and breadth of users. There is legitimate concern over the impact this IP Transition might have on consumers, small businesses and other organizations such as hospitals and municipalities.  Ensuring at a minimum that continuity and consistency are maintained is essential.

Some Background:

FCC Transition Trials
In May, 2013, with the move to IP networks gaining advocates, FCC Chairman Tom Wheeler proposed transition trials to determine the impact on next generation 911, consumer transition from wireline to wireless services and interconnection with VoIP traffic. The proposal received mixed reviews.

“Today’s public notice is a step forward, though we are disappointed that the FCC still appears tentative about dealing with the IP transition, especially when compared with the bold and visionary goals of the National Broadband Plan,” stated Jim Cicconi, AT&T’s senior EVP for external and legislative affairs. “We will, of course cooperate with the FCC,” he added.1

On June 7th of that year Verizon filed a request with the FCC to replace its copper networks damaged by Hurricane Sandy with their all-wireless service called Voice Link®. The company admitted that the service was not compatible with fax machines, DVR services and credit card machines, or even dial-up Internet services using a modem and a phone line. It couldn’t do medical alert services or alarm company services and it didn’t enable users to use a calling card to make cheap calls. Residents, local unions and the telecom press reacted negatively.

Other industry voices urged caution to ensure the transition wouldn’t be disruptive to consumers and area businesses, including 911 calls and the ability to make or receive calls. Concern was also vocalized by Comptel about VoIP interconnection, how service providers exchange traffic with each other, and the need to ensure technology-neutral, competitive interconnection policies were adhered to once the IP transition takes place. While the inevitability of the IP Transition wasn’t in question, clearly many critical issues surrounding the move needed to be further investigated.

“The Fourth Network Revolution”
In January, 2014, FCC Chairman Tom Wheeler, referring to this transition as the “Fourth Network Revolution,” released an order to: “kickstart the process for a diverse set of experiments and data collection initiatives that will allow the Commission and the public to evaluate how customers are affected by the historic technology transitions [from TDM to all IP network] that are transforming our nation’s voice communications services.” 2

The order invites “interested providers to submit detailed proposals to test real world applications of planned changes in technology that are likely to have tangible effects on consumers.”3

Carriers submitted proposals designed to test the TDM to IP transition. Targeted experiments were designed to speed transitions to IP while preserving “public safety and national security, universal and affordable access (including maintaining wholesale access and the status quo in interconnections), competition and consumer protection.”4 Proposals for the trials were due in February, 2014 and voted upon by the FCC at its May, 2014 meeting.

AT&T Testing
In late February, 2014, following the FCC invitation, AT&T targeted a rural area, Carbon Hill, Alabama, and a more suburban area, West Delray Beach, Florida, to conduct tests on all-IP services. “We chose these locations in an effort to gain insights into some of the more difficult issues that likely will be presented as we transition from legacy networks,” said Hank Hultquist, vice president/federal regulatory for AT&T. 5 Tests are being conducted to determine if customers in need of emergency 911 services and people with medical devices and home security alarms can be assured they can still get a connection.

Further FCC Action
On October 31, 2014, Chairman Wheeler suggested that the FCC take further action on the TDM to IP transition with regard to copper retirement and consumer protection in the event of changes to 911 systems. On November 21, 2014 the FCC issued a notice of proposed rulemaking (NPRM) and sought comment on revisions to their rules and policies to deal with the possibility that consumers and small businesses, relying on services, may not be adequately supported following a transition. The goals for this round of rulemaking included:

­   Ensuring reliable back-up power for consumers of IP-based voice and data services across networks that provide residential fixed service substituting and improving traditional telephony used by people to dial 911

­   Informing and protecting consumers as networks and services change

­   Protecting competition where it exists today so entities such as small- and medium-sized business, schools and libraries can choose the services that best suit their needs.

The Comment Period is still in effect.

In November, 2014, Century Link requested permission to conduct TDM to IP trials during a six-month period in 12 wire centers. The trials will be conducted primarily at Las Vegas businesses, focusing mainly on replacing POTS services with VoIP. The trials are still being held.

 

A Perspective
New technologies are always difficult to plan and implement. The impact on current and new customers must be a priority.  The market has already determined the road to be taken, and now it will be a regulatory effort to push those stragglers that are falling behind onto the journey while not impacting public safety. In the case of the TDM to IP transition, it’s clear that the stakes are high – in some cases a matter of life or death. Competition must also be preserved, as the Titans of the communications industry have the human and fiscal resources to move forward more quickly than other players.

The FCC is playing a critical role in this Fourth Network Revolution. In their own words:

“Our January 2014 Technology Transitions Order unanimously recognized that the success of these technology transitions depends upon the technologically-neutral preservation of principles embodied in the Communications Act that have long defined the relationship between those who build and operate networks and those who use them….We are determined to ensure that these fundamental values are not lost merely because technology changes.”6

Some people in our industry are probably impatient with the FCC and other regulatory entities who might potentially apply the brakes from time to time, slowing down the implementation and acceptance of the IP network technology. But their involvement is critical to the lasting success of this network revolution which bodes to be a powerful new agent of change for the lives of us all. It’s not a matter of “if” this new technology will be ubiquitous. It’s a matter of “when.” And we need to get it right the first time.

Carriers need to proceed aggressively, but carefully. Judicious planning, testing, adjusting and executing will be key.  Most importantly, the transition must benefit the customers. They need to want to move to IP, not be forced to move, either by the carriers or by the FCC. In the end, carriers that embrace this change and accelerate their transition, while keeping the best interests of their customers in mind, will have an enormous competitive advantage in the marketplace.

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  1. Sean Buckley, “IP technology transition trials proposed by FCC met with mixed response,” Fierce Telecom, May 13, 2013.
  2. Federal Communications Commission, “ORDER, REPORT AND ORDER AND FURTHER NOTICE OF PROPOSED RULEMAKING, REPORT AND ORDER, ORDER AND FURTHER NOTICE OF PORPOSED RULEMAKING, PROPOSAL FOR ONGOING DATA INITIATIVE,” Adopted: January 30, 2014; Released: January 31, 2014, page 3-4.
  3. Ibid.
  4. Ibid, pp 14-25.
  5. Sean Buckley, “AT&T to conduct TDM-to-IP transition tests in Alabama, Florida,” Fierce Telecom, February 28, 2014.
  6. FCC Takes Up Consumer, Competition, 911 Safeguards in Tech Transitions,” Adopted: November 21, 2014; Released: November 25, 2014, page 2.