Subject: ISDN backbone costs, prices

From: [email-masked] (k1io, FN42jk)
Date: Mon, 13 Apr 1992 12:34:21 -0400

Bob Frankston's comments, and Mitch's earlier comments from another 
bulletin board, both point out the importance of ISDN usage pricing.
How much does switched data differ from voice?

New England Telephone's new Mass. tariff assigns measured voice usage 
rates to switched intra-office ISDN switched 64 kbps.  Most businesses 
have to pay measured usage anyway.  Residential customers in Mass. are 
entitled to pay for flat-rate local voice calling, with various radius
options in the Boston area.  But that's not to be applied to ISDN clear-
channel 64 kbps.

Some other telephone companies have offered voice/data parity for
ISDN.  I believe that's the case with Southwestern Bell and Pacific
Bell, as well as BT (aka British Telecom).  Of course, BT doesn't offer
any flat-rate local calling to anyone; their local message rates are
higher than anywhere in the US.

Within a CO, voice = data is a good assumption.  Everything's handled
at 64 kbps.  So parity is logical.  But Mass. DPU has a veneer of
justification for requiring this to go at message rate:  The flat rates 
were set based upon the typical voice user's traffic.  While modems 
benefit from that (we don't face the odious "modem tax" here the way
some SWBell and Moscow Tel customers may), it's still a distortion of
the "intent" of flat rates:  If ISDN were offered for flat-rate usage,
then a single ISDN access line could make _two_ simultaneous calls for
"free", one on each B channel! 

The fix to that gets confusing.  The new Mass. tariff charges a fixed
surcharge, atop your voice line rate, for ISDN.  It doesn't matter if
you're Metropolitan or Measured service.  If you could make two calls
at a time over one Metro-rated ISDN line, they'd be "losing" the revenue 
that they'd get today by selling you a second Metro line, which costs
quite a bit more than a Measured line.

The rational-user's response is also interesting.  I think that it's
possible to make two "speech" calls at a time over an ISDN line.  A
"speech" call falls under the flat rate.  I assume NET doesn't figure 
that this will be a big problem.

To be sure, the "problem" is not one of "losing money" (rate lower than
cost), but of "opportunity cost" (lower profit margin).  The 1.6c/minute
measured rate (over a nickle beyond 8 miles) is way, way above their
true cost.  It subsidizes the low basic residential rates and cheap
installation rates.  Crocodile tears come to mind.

Now, the rational-user's response is applied to data.  If the call
is the same voice or data, why even tell the network that it's data?
If you originate a local call bearer service = speech, it'll still carry 
data at 56 kbps, if not the full 64 kbps (American T1 being an issue).
So you may still get the flat rate for data.

Is this "cheating"?  No, because the network is only delivering the
grade of service that you contracted for, which is speech, and any
ability to send data is without warranty of any kind.  Furthermore,
you _have to_ do this in order to go between COs.  Without SS7, all
interoffice calls default to speech, and data calls fail.  Since the
interoffice trunks are (almost?) all digital now, why not use them for 
data anyway, over the Speech bearer service.

That's actually an official feature of the Digiboard IMAC remote ISDN
to Ethernet bridge.  It will do 56 kbps over Speech calls, complete with 
echo suppressor cancellation tone (needed for long haul inter-LATA use).
And it's a capability that some telcos actually tell us to use -- Pac
Bell mentioned it to customers as a work-around for the lack of SS7.
I hope to "test" it over NET's network this year.

So the data price is a compromise between different theories, and you
don't really have to pay it anyway.  What a country!  :-)

This, btw, really bewilders ISDN users in Europe.  They don't even
dream of trying this "speech" hack.  They don't usually need to, anyway, 
and they worry that they'd not get PTT certification for equipment that 
ran that way.  And they're too timid.  And they don't have flat rate
local calls to begin with.  And it's not in the CCITT Recommendations.
It's not even called out explicitly in the ANSI Standards.  So it's
a mandatory part of ISDN "folklore", which implementors have to know,
but nobody wants to write it down.
   fred