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27th January 1997
Net Telephony, fad or future?
Yes it's true! Now you can use your "state of the art" Pentium Pro 200 with 32MB RAM and 2.5GB of hard disk to replace two tin cans and a piece of string. And, if you're lucky, the quality of the connection will almost be as good.

Okay, perhaps that's a little overly cynical, but it really does seem anomalous that people are getting enthusiastic about replacing a $19.95 telephone with a $3,000 computer and that they're willing to partake in all sorts of procedural gymnastics just to save a few cents on a phone call.

"Hello there, how are you?". A simple phrase that could be sent by email in just a hundred bytes or so. Send the same thing as part of a Net Telephony session and it will consume 50 times as much valuable bandwidth. Given that some are already talking about an impending "Internet meltdown" caused by congestion and insufficient capacity, is it a good idea to start burdening our already overloaded data circuits with such an inefficient method of transferring information?

So, is Net Telephony the next "big thing" on the Net? Does it really represent a significant challenge to the Telco's core businesses?

I don't think so and I think the reasons are pretty easy to see.

Almost everyone who uses the Internet, especially those who have posted a message or two to usenet newsgroups will by now have received unsolicited commercial email from one or more companies willing to sell you a "callback" scheme that offers to slash your international toll charges. Yes, for just a modest amount of inconvenience, you can save up to 50% or more in an international toll call - sounds too good to ignore doesn't it. Why aren't we all using such systems? Why do Telecom and Clear still make healthy profits from their international toll traffic?

Closer to home, national toll-rates have dropped significantly in recent years, to the point where we now have flat-rate calling on weekends and evenings.

Given that those ISPs capable of providing enough bandwidth for half-reasonable Net Telephony are charging either by volume or time, the average national Net-phone call will cost between $2.50 and $5.00 per hour, not a lot less than the cost of a traditional call when the many Telco loyalty discounts are included. Given the huge profits currently made by Telcos, I'm also sure there is plenty of room for downwards movement if Net Telephony became much of a threat.

cheap enough?
cheap or good?
Then, of course, there's the issue of quality. Talking is a "realtime" activity. You expect the words you say to be delivered "as you say them". Once you start inserting delays or when bits of a conversation are lost, it can become very difficult to conduct a discussion. Have you ever made an international toll-call and found yourself on a non-terrestrial circuit? You can soon tell because there's a noticeable delay involved in the delivery of your speech which makes it difficult to judge when the other party has stopped and you can can start talking. Conversations become very stilted and unnatural in such cases with both parties often talking at the same time with a resulting uncomfortable situation where you get a "you go", "no you go", "no you" impasse.

The very market which could benefit most from the savings associated from Net Telephony (business users who are making national toll calls during peak hours) are those who are least likely to put up with such limitations. Call someone using a Net Telephony system that introduces these problems and you're saying to your customer "we're too cheap to use a real phone!".

Another barrier to the success of Net Telephony is the difficulty associated with its use.

In the computer to computer mode, both parties need to have a suitably equipped computer, modem, and Net connection. That's fine if you're a regular Net user anyway but this is just a small percentage of the total population.

The answer to this would appear to be the phone to phone or computer to phone options. Unfortunately there are still hurdles to overcome here. Dialing a national call already involves punching nine digits, an international call may require 13. Now if we add the need to use an ID and/or PIN number of non-trivial length, the user could be left punching in over 20 digits to make their call. I think most people will find this just too much of a hassle - certainly for National toll calls where the cost savings simply aren't that great.

If price was more important than simplicity and ease of use, these callback systems would have captured 100% of the international toll market already - but they haven't so what does that say?

because we're lazy
will anyone use it?
This does not mean that Net Telephony will disappear, quite the contrary. It will grow strongly - but not enough to scare the Telcos. Lack of convenience, the limitations of Internet bandwidth and the associated constraints on quality will see to that.

But, there will always be those who are keen to exchange quality and convenience for a saving. There will always be those who will use Net Telephony simply because they can.

It must also be admitted that "sometimes" Net Telephony works damned well with a quality that is almost indistinguishable from a normal phone connection - but as we load up the Net with an increasing number of users, this will most certainly become less and less common.

I do believe that within a decade, everyone will be using a form of Net Telephony - well a digital phone anyway. At the moment, the analog link from your local exchange or fibre hub is the weakest link in our phone system. With the need for high-speed digital communications becoming stronger I believe we'll see a move towards bringing the digital connection right into the home. Eventually our phones will be digital devices, complete with a plug for your computer that will offer a high-speed digital connection to the rest of the world.

In the meantime, when it comes to Net Telephony - I'll stick to the string and cans, at least you'll get a couple of cold beers out of that one!

The quality of Web sites
In recent times we've seen some new entrants spend small fortunes on creating web sites. NBR were rumoured to have handed over in excess of a quarter of a million dollars to have their site developed and as IDG reported last week, the budget for the proposed Wilson and Horton (NZ Herald) site could be just as high. I've not seen any figures for the ClearNet site, but I suspect that it wasn't cheap either.

I think it's incredible therefore, that some of these sites seem to be launched without the aid of an independent 3rd-party site review. Site reviews are an important way of catching all those little bugs, errors and omissions which the site developers themselves often never spot.

Why spend six figure sums to develop your "image" on the Net and then ruin it by penny-pinching at the very end?

Is it really that important? You bet! Compare the launch of the ClearNet site to that of the NBR site. Clear's site was stringently reviewed and this feedback was used to ensure that at launch, there were no problems of any significance.

By way of comparison, after several months of operation, the NBR site still suffers from a number of anomalies and problems that one would not expect to exist in something that cost so much. Regardless of the subjective issues of aesthetics, layout and design, to be a positive vehicle for promoting a company, club or group, a Web site should be free of errors and inconsistencies.

It's not my intention to pick on NBR and perhaps the sheer size and complexity of this just site makes it an "easy target". If more site developers were prepared to engage 3rd party site reviews, their might be less material around for Aardvark's "I can't believe it's true" section. Isn't it about time we had a push for quality? Is there a need for an independent Quality Certification Authority to guarantee that clients receive a minimum standard of work?

the good the bad and the ugly

I Can't Believe It's True!
Turn your graphics on and prepare to be astounded when you see what a major broadcast communications company can do with Internet technology. What does this say about their attitude to the Net and the people who use it? It's amazing what you can do with this media if you have a big enough budget isn't it?

The TVNZ Corporate page

What did I say about the value of 3rd party site reviews?
 
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Martin Taylor of IDG replies


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