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Telecommunications is a prime industry, like electricity, water and gas and, like these industries, it impacts on every individual, organisation and country. Telecommunications is, however, much younger and as such it is more dynamic and vibrant. It is growing and changing at a phenomenal rate. Politically, telecommunications is going through an exciting period. Old state owned monopolies are being privatised, and liberalisation has resulted in many new entrants. As organisations have become more multinational, so have these telecommunication oper ¬ ators. Competition has quickened the pace of technology development.




Copper is being rapidly replaced in the trunk network, including underseas, and is under threat in the local loop. The pace of fibre deployment is accelerating and wireless communications has provided personal mobility which was unpredictable two decades ago. Telecommunications is an exciting business, so much so that it is easy to forget the most important consideration in every business; telecommunication only exists to serve the customer. What the customer desires is services which meet his requirements at prices which he considers to be good value.
Twenty years ago the services business was a niche industry on the edges of POTS. By 1990 the world market for value-added services was $17 billion, and by the year 2000 it will exceed $80 billion. In Europe alone, the services market was $9 billion in 1991 and will exceed $30 billion by the year 2000-almost 40% of the world market. In addition a European Commission paper estimates that by year 2000 over 60% of all EC employment will depend on telecoms based activity. However, a RACE study found that Europe's telecommunication operators currently gain only 5% of their revenues from specialised business services, compared with 20% in Japan and the US. The aim of technology is to provide the customer with services.




For example higher bandwidth, enabled by the use of synchronous transmission over optical fibre, will support a host of new applications, such as image and high speed data. Similarly intelligent networks will grow, the intell igence and functionality being moved closer and closer to the customer. The trend in economics of networks will have a significant impact on customers as well as providers. So long as tariffs remain high, private networks will continue to grow. If, however, tariffs fall closer to costs, we will see increased demand for public network services. Here the experience of the US market is illustrative: of the 500+ US corporations that built private networks in the 1980s, 80-90% have since moved their voice traffic on to virtual networks, as the price of switched voice service ha.fallen.
The trends in customer needs, technology and regulation are combining to create an entirely new kind of network, with new Foreword controls and competitive forces to govern its operation. The characteristics of this network are fairly clear already. First, in wideband access electronics will migrate much closer to the customer in the coming months and years, driven not only by technology but more importantly by demands for service responsiveness and lower operating costs. In many cases a fibre will terminate in the basement of the business building. Almost all large businesses and many medium and small locations will have direct access to a fibre based connection.
This will lead to wideband access at up to 2 Mbits/s becoming widely available, with short provisioning times, in many markets by 1995. In addition, because fibre systems can easily transport tens of megabits of information, the network will be positioned to transmit at much higher speeds with marginal cost increases, as service demand arises. Coupled with pan-European wireless networks, the economics of fibre access, for both narrowband and wideband, will shift dramatically, obsoleting today's tariff structures.

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