The national telcos are introducing high speed services gradually for fear of cannibalising their existing revenue streams, suggests a recent white paper from the Yankee Group Europe.
But they may be overtaken by a new breed of service providers, such as Worldcom, which are developing a range of services and tariff options that are 'cream skimming' the traditional telcos? lucrative high speed service market.
The Yankee Group suggests telcos are unlikely to sell 'raw' high speed services, but instead will market these to Internet service providers. For the end user market, telcos will create packages that include ATM, transparent Lan services, frame relay, and ADSL. This will give users better value for money, and give the service provider some degree of revenue, said the report.
The telcos are concerned that if they provide higher speed leased lines, their competitors will use this to steal the telephony market away from them, suggests the report. To counter this, the carriers are shifting their emphasis to providing more data network and managed service options at these higher speeds. At the same time, the new entrants are providing more raw capacity services.
In the Lan, users are more concerned with finding the appropriate architecture and buying the relevant devices. The use of switched Ethernet to desktops and ATM in the Lan backbone will satisfy bandwidth demands for the short term at least, suggests the report.
Overall, users are expecting to increase their Wan backbone speed from 64Kbps and 2Mbps to 34, 100 and 155Mbps in the next two to five years. This will be driven by Intranet, client/server and multimedia applications, as well as network consolidation.
Carriers will move from trying to position one high speed service against another, to offering a range of mainly managed services to provide Lan interconnection and Intranet services.
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