RESELLER CHANNEL: Resellers Rally `Round T1 Resurgence

Posted: 07/2002

Resellers Rally `Round T1 Resurgence

By William Matern

For years, data communications pundits have predicted T1/E1 soon would be obsolete, replaced by Ethernet, gigE, DSL and other data transports. Predictions aside, telecom carriers and resellers still are focused on transporting voice and data over T1 because demand continues to grow, profit margins are healthy and the technology is proven and can accommodate newer packet-oriented transport.

Part of the growth can be attributed to T1's capability to transport voice and data on a single twisted pair (integrated T1). While newer transport technologies are attractive from a data standpoint, voice is still a challenge they must overcome. What the pundits often overlook is that while newer transport technologies have been maturing, T1 has been improving.

The Yankee Group notes the tremendous opportunity for resellers of telecom services to profit from selling integrated T1 service to small and medium businesses (SMBs), citing the addressable market to be 28 percent of all businesses with between 10 and 249 employees.

Data Transports' Reach
Source: NComm Inc.

T1 Evolves

In the 1960s, the early days of T1 service, T1 technology could be difficult to deploy because of its physical loop reach and complexity. During the years, dramatic reductions in the engineering time required to deploy T1 have been accomplished, while improvements have been made in transporting data or voice applications more efficiently over T1. Higher speed access methods like DS3, SONET and SDH have specific accommodations for carrying multiple T1 streams. With such capabilities already built into the network, it also is possible to deliver services requiring high densities of T1s.

Limitations in physical reach were resolved with the advent of HDSL in the early 1990s. HDSL permitted T1 to be deployed over CSA (Carrier Service Area) loops by quadrupling the 3,000-foot reach of T1 without the expense and complexity of repeaters/regenerators. About 80 percent of customers needing service are within CSA, or about 12,000 feet, using 24-gauge wire. Further, HSDL has better spectral characteristics, reducing the chance of it interfering with other circuits being carried in the same wire bundle.

In the late 1990s, HDSL2 reduced the wire pairs needed from two to one and made it possible for T1 to better co-exist with newer technologies like ADSL and VDSL, which were anticipated to show up in the same wire bundles. This made engineering less complex and effectively doubled the revenue potential of the installed copper wire bundles.

Now, HDSL4 is a new standards-based technology that provides T1 access 30 percent beyond the current CSA guidelines without the spectral interference of earlier implementations. HDSL4 (HDSL2 over two pairs of wires) extends T1 out over 16,000 feet using 24-gauge wire with no repeaters. This brings more than 90 percent of potential users within range of T1 without engineering lines with repeater/regenerators.

SMB Opportunity

The proliferation of integrated access devices (IADs) makes T1 service a relatively straightforward value proposition for SMBs and, thus, a prime opportunity for resellers.

Integrated Voice and Data. The major carriers have been selling integrated T1 for years as a high-profit service for large companies leasing T1s for their own use. It also provides a cost-effective transport service for SMBs while giving the reseller a high-margin offer that is easy to deploy.

A T1 is designed to carry 24 phone lines (DS0s) utilizing 64kbps each, but these DS0s can be used for data as well as voice. Further, the DS0s can be used as a single "pipe." Two can yield a 128kbps circuit, four will yield a 256kbps and so on. A single T1 can be configured to provide POTS and data lines as required. Because most businesses are located within 12,000 feet of the beginning of the T1 circuit HDSL2 can be used to provide service on a single pair of wires.

Web Hosting. ADSL is suitable for most end users that require Internet access because it provides the high-speed down link required for massive downloads. However, Web sources providing these feeds must get the information into the Internet at least as fast as users expect to receive it. Asymmetry does not work for the Web hosting site or data source. T1 provides a symmetric alternative for providing data into the Internet. In addition, it provides ample bandwidth for downloading and uploading to overcome the bursty nature of inquiries and the proven 512kbps bottleneck between the user and source in the Internet.

Multitenant Market. Once a telecom service reseller starts deploying T1, it also can use it to deliver service to more than one business at a time. A T1 can be deployed to a multiple tenant office complex or apartment building and the DS0s split up to offer dedicated voice and data services to multiple clients. This offering is made easier and less costly to engineer and maintain because of advances such as HDSL, HDSL2 and HDSL4.

T1 is a workhorse technology. It is engineered for the voice requirements of low latency yet can meet the requirements of data transmission. In data applications, it can function in its native TDM mode or as the transport layer for packet-based protocols. It can carry phone lines while simultaneously carrying data. It has reach without interfering with other services like ADSL or ISDN. And, it all can be provided to a user on a single twisted pair of wires. The equipment and technology is known well, is proven, is relatively inexpensive, and finally, it is consistent with the existing network infrastructure.

William Matern is CEO of NComm Inc., a provider of WAN interfaces such as T1/E1, T3/E3, SONET and SDH.