The Internet will get its voice, perhaps with help from ISDN

Could agencies' communications costs start falling through the basement far in advance
of the General Services Administration's planned post-FTS 2000 rollout?

It isn't official yet, but the Federal Communications Commission apparently will not
stand in the way of voice telephony over the Internet. Meanwhile, there's a groundswell of
pressure for regional Bell companies and other telephone service providers to cut their
unnecessarily steep rates for Integrated Services Digital Network connections.

Those two situations could precipitate both a big drop this fall in pricing of
broadband connections and a strong effort to develop digital voice technologies that use
those connections.

The winners will be government offices that rack up a lot of international telephone
traffic.

At last month's INet conference in Montreal, the FCC's chief of staff, Blair Levin,
delivered a speech prepared by commission chairman Reed Hundt, who believes "the
right answer at this time is not to place restrictions on software providers, or to
subject Internet telephony to the same rules that apply to conventional circuit-switched
voice carriers."

Hundt said a carriers' association sent a petition a few months ago asking FCC to
restrict the sale of Internet phone software, because the software providers don't have to
comply with the regulations for telecommunications carriers. But Hunt said he considers
voice traffic just a particular kind of data and imposing traditional regulation on it
would be both counterproductive and futile.

"Even if most of the FCC wasn't working around the clock on implementation of the
Telecommunications Act of 1996," he said, "I can't imagine that we would have
the time to keep track of all the bits passing over the Internet to separate the
'acceptable' data packets from the 'unacceptable' voice packets."

The message is clear: Internet voice traffic will survive, if not thrive. What does
that mean to Joe Desktop?

Anyone who has tried Internet telephony with products like Quarterdeck Corp.'s WebPhone
or VocalTec Inc.'s Internet Phone knows that the sound over a 14.4-kilobit/sec connection
is like that of a conversation through a closed door. But this immature technology is
improving rapidly. Over a 28.8-kilobit/sec connection, speech is choppy but clear enough
to understand.

To hit the big time, Internet telephony needs a technology savior. That savior could
very well be ISDN--but only if its pricing drops.

Todd Paglia, staff attorney for Ralph Nader's Consumer Project on Technology, a group
that monitors telecommunications issues, told me, "We're seeing a precipitous decline
in ISDN pricing in places where public hearings have been held on rates."

For example, on the East coast, Bell Atlantic Corp. sells CallPak ISDN monthly service
in set increments: 20 hours for $31, 60 hours for $45 and so on, up to more than 200
hours. Unlimited usage costs $249, but after public hearings in Delaware, Paglia said, a
state committee recommended reducing that flat rate to just $28.02. In Washington, a local
watchdog group recommended $32.

Bell Atlantic hasn't officially started slashing ISDN prices yet. But the trend is
clear. Paglia said the recommended reductions were based on the actual costs for telephone
companies to install ISDN connections, and those prices have fallen in the past year.

ISDN is the most readily available technology for converting the government's current
analog switched networks to end-to-end digital networks, so it's worth monitoring ISDN
rates carefully. Visit the World Wide Web site at http://www.essential.org/cpt
  for information on local rate hearings.

If per-minute charges were eliminated, it whould be much easier for government offices
to budget for ISDN services. There are other fees, of course: $25 to 40 per month for a
line itself (which doesn't connect you to the Internet), and if you don't already have an
Internet service provider that supports ISDN, another $20 to $40 for that.

ISDN hardware prices are falling, too, but you'll pay about $400 right now for an ISDN
modem. ISDN routers, which hook multiple users to an ISDN line, are becoming easier to
install and more compatible with the ISDN switches at phone companies' central offices.
Routers start around $500.

Of course, even with a good connection in place, Internet voice traffic can't compete
with the quality of your current telephone service. But the boom in cellular telephony has
already proved that many, many people will trade sound quality for convenience.

They certainly will trade sound quality for a chance to save money, especially on
international calls. Can you imagine, say, the State Department someday putting its voice
traffic on Internet connections?

It could happen, and sooner than we think.

Shawn P. McCarthy is a computer journalist, webmaster and Internet programmer. He
is developing and maintaining a corporate Web site for GCN's parent, Cahners Publishing
Co.