Online Bandwidth Trading Goes Live

[May 22] Australian telecommunications bandwidth exchange eSwitch has gone live today, with the
announcement that its trading systems are now operational.

Buyers and sellers of telecommunications capacity who become members of
eSwitch can now view and trade voice minutes on the online spot market,
which was established to provide an independent and open market for trading
telecommunications capacity.

“The creation of an independent and anonymous market place for
bandwidth is a strategically important step for the Australian
telecommunications industry,” said eSwitch managing director Nick Haddad.

“It introduces significant advances in flexibility and competition for
all players. Bandwidth deals do not have to be locked in months at a time,
or months in advance – the eSwitch exchange allows buyers and sellers to
trade the capacity they want, when they need it, and at the market rate
available at that time,” he said.

Transactions occur on the eSwitch Web site where prices for bandwidth
are anonymously posted. When a sale is finalized, a centrally located
eSwitch exchange ensures delivery of the bandwidth is immediate. eSwitch is
currently trading in minutes for long distance phone calls, but
will expand into other areas of bandwidth and telecommunications services
in the near future.

eSwitch expects its service will improve the flow of information between
carriers and service providers and introduce an efficient method for the
trading of bandwidth.

According to Haddad, this process has traditionally been a complicated,
time consuming and costly exercise for both carriers and service providers
based on individual one-on-one contracts that varied on a case by case
basis. “The time and effort required to establish multiple trading
arrangements between service providers and carriers can now be reduced
significantly,” he said.

eSwitch’s revenue comes from a small commission taken from each
transaction. The company said it has struck agreements with a number of
telecommunications companies who will have the opportunity to participate
in real time online trading, and will seek more participants to increase
the depth and efficiency of the marketplace.

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