WorldCom Is Now Truly Long Distance

WorldCom is taking to the skies with a two-way Internet over satellite
(IoS) service, geared for business use, through Hughes Networks, officials
announced Tuesday.

Officials at the nation’s most
popular long-distance phone company
are taking a chance that businesses
will overlook some of the technology’s performance issues to see the
potential cost advantages of a satellite connection.

WorldCom’s very small aperture terminal (VSAT) service connects a user to
the Internet by sending data from a hub station to a satellite in
geosynchronous orbit around the Earth, which is then “beamed” down to a
transceiver on the user’s house. VSAT normally handles up to 56 Kbps of

Technicians will not start installing the service until Jan. 1, according
to WorldCom officials. The service will be available in 600 Kbps, 800 Kbps
or 1 Mbps download speeds, with 128 Kbps upload speeds. Service level
agreements reached with Hughes virtually guarantee the 128 Kbps speeds will
be maintained, according to Natasha Haubold, WorldCom spokesperson.

“Of course, there’s always going to be a time when you won’t see 128 Kbps
all the time, but we’re pretty confident our customers will be able to
maintain that level of upload speed,” she said.

Depending on the area of the country a business is in, a standard T-1 line
from the telephone company can cost in the range of $3,000 a month. That
price is just for the actual fiber or copper connection in the ground, not
the services that make company’s intranet run (a virtual private network
(VPN) service can run up to $1,000 a week). Reports show that WorldCom can
cut that pricing nearly in half and still clear a profit.

Haubold said pricing will hold somewhere between the price for a business
DSL line and getting a T-1 from the phone company. WorldCom, like many
carriers, makes arrangements with companies for lower pricing and such
dependent on a number of factors (like region), so putting an exact dollar
amount is always tricky.

Ralph Montfort, WorldCom director of Internet services, said the service
gives businesses another high-speed option that already includes digital
subscriber line (DSL) service.

“WorldCom Internet VSAT is the new broadband access solution for businesses
of all sizes, offering immediate primary connectivity and business
continuity for reliable network back-up services, in any location,”
Montfort said. “Adding VSAT to our existing DSL and dedicated access
offerings gives WorldCom the unique ability to give our customers exactly
what they want and need — individually tailored access solutions based on
their business applications, network architecture, geography and budgetary

Hughes Networks has been testing and selling residential two-way satellite
connections for almost a year now, first
to Internet service providers
(ISPs) who could resell the service and
then expanding to residential customers. The service is tied to a
customer’s satellite TV service
(DirecTV) and goes for roughly $60 to
$70 a month.

Officials are mum on the numbers, but the price tag coupled with the ready
availability of cable and DSL Internet access, points to a glum picture for
residential satellite service.

Businesses, however, are more than ready for a low-price alternative to the
telephone company, which has been steadily increasing their prices over the
past couple years.

Officials promise download speeds of up to 1 Mbps, which is an optimal
environment for streaming presentations and the like to a group of remote
users. Satellite streaming is actually preferable to land-based broadband,
since DSL operates on a point-to-point basis, where streaming by nature is
a point-to-multipoint product.

WorldCom is also touting the service for the following applications, which
capitalize on point-to-multipoint communications:

  • Video-on-demand.
  • Distance learning.
  • data- and multi-casting.
  • Interactive TV.

But for critical business applications, the telling point in any high-speed
offering is the latency of the network and the upload speed. Satellites
hovering in geosynchronous orbit miles above the Earth have inherent
latency, up to 250 milliseconds one way. That’s 10 times higher than the
lag from a fiber optics connection.

Haubold said the latency issue is a moot point since it only really affects
a couple of business-type applications that are in demand today.

“You’re going to see some problems with (telephone) Net conferencing and
you probably won’t be able to get away with two-way multicasting,” she
said, “but the download speeds available work wonderfully for things like
streaming media.”

The true benefit to WorldCom’s service is its ability to go anywhere in the
U.S. without installing fiber or other lines to the remote site. That’s a
step up from previous attempts to provide two-way satellite Internet.

In the past, users could download from a satellite connection, but were
forced to upload using a land line. Now, a remote user installs the proper
software, points the satellite dish and they are up and running.

WoldCom and Hughes are relatively alone in the two-way satellite Internet
market. Gilat-To-Home Inc., a venture created by Gilat Satellite Networks
Ltd., Microsoft Corp., EchoStar
Communications Group (of DISH TV fame) and ING Furman
Selz Investments Inc., have their own two-way satellite
service but have not launched business-class services to date.

Both WorldCom and Hughes have considerable stakes in DSL, a sign both
companies won’t seek to usurp the high-speed service entirely. WorldCom
recently took over a majority of the
of now-defunct Rhythms NetConnections, while Hughes bought out
failing Telocity.

News Around the Web