Aswath Weblog

How Could the Empire Strike Back?

SOMETIMES what appears to be a threat is actually a life preserver.

The poor defenseless music industry cowered - then prosecuted - when the monster of digital downloads came lurching over the horizon. Then the iPod came along and music looks like a business again - a smaller business, eked out in 99- cent units - but still a business.

Cable channels were supposed to gut network television, but instead have become a place where shows like "Seinfeld" and "Law and Order" are resold and rewatched. The movie industry reacted to DVD's as though they were a sign of the imminent apocalypse, and now studios are using their libraries to churn profits.

Which brings us to the last of the great analog technologies, the one many of you are using right now.

From Forget Blogs, Print Needs Its Own IPod by David Carr, New York Times, Oct 10, 2005-10-12

Thus began a recent article in New York Times. As you read this, one might anticipate that the story is about the telephone network. But then it long since has ceased to be an analog technology (notwithstanding an occasional derisive comment to that effect). In any event, this started to make me think how the PSTN operators could make their offerings comparable and competitive to those that COULD BE (very few are actually offered) offered via IP. This note is an attempt to capture some of my thoughts.

The first assumption I am making is that the most of the PSTN subscribers will be comfortable to stay with the service rather than switch to VoIP if the features are comparable. For example, if a customer prefers flat-rate billing structure and a PSTN carrier offers it, then the customer will not migrate to VoIP. If a prospective VoIP customer likes the Presence capability, but a PSTN carrier offers a comparable capability, then it is very likely that the customer will stay put. In other words, the First Law of Market Behavior applies – Customers will continue to use a long used service until and unless a new offering is substantially better or different. This means that PSTN better plan on having feature parity.

For all the talk of “Stupid Network” most of the VoIP service providers are really recreating the same old “Intelligent Network”. They have to; otherwise there is no need for them. This is a big relief for PSTN operators because architecturally there is parity. So any feature distinction comes about because VoIP uses an out-of-band, message oriented signaling. If at all, POTS can offer only a rudimentary enhancement as is done for Caller ID. But this is an expensive proposition. This implies that one has to come up with a smarter way of conveying signaling messages without requiring a major upgrade to the existing system.

In the real IN architecture used in PSTN, there are two entities – SSP and SCP. The SSP is the traditional telephone switches and SCP is like an Application server where feature logic could be executed. Since the SCP is a computer, it could be augmented with an interface to the Internet and it could be used to generate and receive the message oriented signaling from the PSTN end-points. This is a simple enhancement.

The problem is not fully solved. There has to be a device at the customer side that can receive these messages and present it to the users in a meaningful way. In other words, as the title of the NYT story (Forget Blogs, Print Needs Its Own IPod) suggests that PSTN needs its own iPod. What should be the design of PSTN iPod? If we restrict the market to those who have broadband access, then think of an enhanced cordless phone system where the base station also has an Ethernet interface. This way the base station can be connected to the SCP. Also the base station can use the screen of the handset to display information like buddy list, presence and enhanced call handling of a waiting call.

As I see it, if the VoIP industry does not heed the advice of the Jedi and realize the force of IP Communications, the Empire can strike back.