In my 45 years in the telephone business I have witnessed change from paper and pulp cables to Plastic Insulated Conductors to fiber, operators to dial pulses, to touch tone dialing, mechanical central offices (COs) to digital COs to CO soft switches, fax machines, Caller ID, dial-up modems, and Plain Old Telephone service (POTS) to xDSL to IPTV. In today’s environment change in the communications industry is exponential.

The customer and the customer demands are changing along with us. In the old days POTS was all that was needed for most customers. The industry was regulated. Service by in large was provided by telcos. Transport was over paired copper conductors. With deregulation the customer has a choice of vendors for his service. He has the ILEC, the CLEC, cable, and the wireless provider for his service needs.

Advancement in technology preempted new services, and one of the most important was fiber. Fiber was introduced in the 1970s and became an alternate to microwave for long haul transmission, and in the 1980s the first transatlantic fiber was turned up. Fiber has replaced copper almost completely for the long haul and in the feeder plant for most telcos. Rather than extending copper to the customer from the CO, fiber is run from the CO to remote terminals or nodes (FTTN) that supply POTS, DSL, and, in many instances, IPTV.

Around 12% of North American homes are now passed by fiber, and around 3% are fiber to the home (FTTH). This will increase as most telcos are placing FTTH in any new construction projects while providing The Triple Play in existing subdivisions using the FTTN concept.

AT&T and Verizon are offering The Triple Play using two different concepts: AT&T uses fiber-to-the-node and copper to the customer for their AT&T U-verse product. Verizon’s fiber optic broadband Internet (FiOS) is fiber-to-the-home. AT&T had more than a million customers at the end of 2008 and expects to have more than 30 million customers by the end of 2010. Verizon signed up more than 1 million customers in June of 2007 and expects to have 6 to 7 million subscribers by 2010.

These two vendors’ services run about $100 per month for the basic Triple Play package, and are a huge future revenue stream vs. POTS contributing around $50 a month. Regulations require ILECs to provide POTS in their territories, but DSL and IPTV is not regulated, and telcos and cable companies are cherry picking only those areas with a high ROI.

Mega subdivisions and apartment complexes are on the top of the list. First Mile distribution plant is groomed for The Triple Play, bonding and grounding issues are addressed, bad sections of cables are replaced, and where applicable fiber is fed directly into the residence. Homes are rewired with CAT5 and CAT6 or coax to increase bandwidth both downstream and upstream plus enough bandwidth for a couple of HDTVs and a smart home.

Companies like Comcast on the cable side of the house and Verizon on the ILEC side of the house now promote digital voice telephone service. This new voice service is administrated through the Internet and it potentially allows Comcast to offer more features for less money. Comcast Digital Voice has more features than Verizon offers at that same price, but Verizon has an edge in service that more than makes up for any additional cost.

The number of access lines in the world according to 2005 information is 1,263,367,600. Of those, according to 2008 information, 163,200,000 main lines are in use in the United States. This number is decreasing rapidly. The lines went from 194,000,000 in 2003 to 268,000,000 in 2006 and 2007 to 163,200,000 in 2008. (The source of this information is CIA world factbook.)

The biggest change affecting the number of the industry’s land lines is definitely the cellular phone and the PCS phone. Today an increasing number of people never order a land line. They use their cell phone and many even use an air card instead of DSL. This has had an enormous impact on the land line. There are more than 300 cellular phone and PCS phone companies in the U.S. supplying 262,700,000 subscribers. This is a drastic increase from the 11,200,000 users in 1980.

Wi-FI has also had a significant impact on the communications arena. The wireless technology has made its way into consumers’ homes supplying IPTV, in-flight Internet, to thousands of hotspots and new devices, and into the business arena. Wi-Fi for business customers will rise from 6.3 million in 2009 to more than 27 million by 2014.

With the advent of the Internet and IPTV the communications business has changed, and will change in the future, creating new models and new jobs. Along with the changes in technology new multi-functional test sets for provisioning and maintaining the infrastructure and associated end user systems are hitting the market by the truck load. Field technicians are scrambling to keep up with the new technologies.

This is an exciting time in the industry. Just 10 years ago, I don’t think we would have projected this much change in how we communicate. It’s exciting, and while some jobs may have been lost, many, many more have been created. The biggest benefit is our ability to easily and cost affordably connect around the world.

Signing off
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