HDSL2: I NTEROPERABILITY AND B EYOND Introduction In order to function, services transported over traditional HDSL require transceiv- ers at both ends — central office and customer premises — provided by a single vendor. Standards currently being considered for its replacement, HDSL2, would allow transceivers from different vendors to interoperate. The obvious benefit for purchasers of such devices is the freedom to “mix and match” components from different manufacturers, increasing competition and ultimately reducing costs. But the real, long-term benefits of interoperability are less apparent and far more important. Interoperability implies standardization. With interface standards in the public domain, the functions of remote HDSL2 equipment will eventually be built into a variety of devices, such as PBX and DSU equipment. This plug-and-play compat- ibility with HDSL2 will drive an explosion in the demand for HDSL2-based prod- ucts and provide a huge increase in the potential market for the services it sup- ports. It is therefore in service providers’ interest to make interoperability a requirement in any HDSL2 equipment they acquire. Standardization may suggest that the product is becoming a commodity but, in the case of HDSL2, nothing could be farther from the truth. The basic functions needed for interoperability may be the same, but beyond that basic level, HDSL2 equipment will be highly differentiated. The differences will affect cost, installation, reliability and support and determine long-term profitability. For most providers, HDSL2 will be part of an array of services, and a step toward new ones they will provide in the future. Today’s choices will largely determine how well HDSL2 fits your product mix today and migration path tomorrow. 22/99 4028 HDSL2: Interoperability and Beyond Traditional HDSL is a robust transmission scheme specified in a working report gener- ated by ANSI. That document, however, left too much leeway in product design for equipment from various manufacturers to interoperate. In other words, each vendor’s products are proprietary, working only with corresponding devices from the same vendor. At the time, this was not a critical issue for HDSL equipment buyers, for a number of reasons: • There were only a handful of vendors providing HDSL • As a digital T1 service that could be delivered over existing copper to a hungry market, HDSL was so profitable that equipment cost was almost irrelevant • Once vendors acquired large accounts, they had valuable “turf” to protect from competitors, so there was little interest in creating a standard • Buyers with large investments in HDSL equipment had little motivation to embrace a new interface that would render their existing equipment obsolete Times have changed. The demand for digital services has skyrocketed. Small branch offices and even home offices now use the kind of bandwidth once reserved for large corporations. There are even larger markets waiting to be served but, like most mass markets, they are more price-sensitive. At the same time, growing demand is driving changes in the supply side of the market. Unbundling has opened the door to new competitors. The variety of DSL transmission schemes is growing, as is the number of equipment vendors. Time frames are shrinking and the business environment for service providers is more competitive and complex than ever. Service providers can no longer be assured of profit by simply offering a service based on any convenient DSL service. As the market becomes more competitive, short-term, tactical planning can lead to expensive mistakes and technological dead ends. What is needed is strategic planning that addresses the broad range of issues affecting the market. These include: • Market segmentation More users mean more applications, from mission critical business to casual residen- tial use. Successful service providers will target specific sub-markets rather than trying a “one-size-fits-all” approach. • Limited availability of copper pairs Just a few years ago, copper was readily available as a medium for digital services. Today, the growth in demand requires that copper be conserved. • Increased vendor participation in the DSL market More vendors are entering the DSL market. Some will conform to standards, while others offer proprietary products. Service providers will have to carefully examine the future implications of today’s vendor choices. • Shrinking time-frames As competition increases, service providers will have less time for deliberation. The needs they don’t meet today will be met by competitors tomorrow. • Increasing variety of services Until now, digital services meant T1. That will not be true in the future. No one can predict with any accuracy the demands that service providers will face. • Decreased separation between user facilities and the network The network interface will begin to migrate into user devices. This has happened in many technologies in the past, e.g., “cable ready” television. While it may initially deprive service providers of a small source of revenue, but it will be a major driver of the growth in demand for service. Background The Changing Market 32/99 4028 HDSL2: Interoperability and Beyond It may not be apparent in the flood of information regarding DSL, but leaders in the industry are taking some very concrete steps toward addressing these issues. The segmenting market has given rise to a split in DSL approaches. The two major segments are HDSL2 and ADSL. ADSL, an asymmetrical, adaptable-rate service, is aimed squarely at the residential market. HDSL2, a more robust, symmetrical service is designed for the critical, two-way requirements of business applications. While the ADSL market promises to be large, HDSL2 has the greater revenue potential per line. This is due to the mission-critical nature of the applications. HDSL2 also addresses the problem of shrinking copper stock, literally doubling the carrying capacity of each copper pair. As demand drives up the value of copper, HDSL2 will, in some cases, replace existing HDSL. The minor inconvenience of having to replace existing HDSL equipment will be more than offset by the increased revenue potential of HDSL2. While the number of vendors will grow, buyers can simplify their decisions (at least in the HDSL2 market) by focusing on vendors offering interoperable systems. Interoperable HDSL2 will let carriers standardize their operations without limiting future choices, and seek competitive prices without affecting ongoing operations. And, should a vendor leave the market or fail to provide adequate service, the carrier will be free to find alternative sources of supply. Most important, however is the open interface that interoperability provides. The most familiar example of interoperability is the common wall plug, the access point for 60 Hz. “house current.” It supplies electricity to your laptop computer or your hair dryer equally well. You can plug the same device into a socket in Seattle or Sarasota, with identical results. If you build a house, you can buy your outlets from any vendor, knowing that they will handle any utility company’s current and any 110V appliance you care to use. This standardization, which we generally take for granted, makes possible the electric tools and appliances we use everyday. For years, telecommunications did not require the same degree of standardization. Until relatively recently, at least in the U. S., a single entity provided virtually all equipment and service. After 10 years of litigation, the Carterphone decision — Carterphone was a simple acoustic coupler that connected a two-way radio to a telephone — opened the network to outside devices. But it wasn’t until the early 1980s that divestiture opened the door to large-scale deployment of what the phone company called “foreign” equip- ment. But, even as AT&T separated into RBOCs, habits changed slowly. In the 1980s, the standard RJ-11 telephone jack replaced the hard-wired telephone connection, but users were still being urged to notify the telephone company before plugging in their answering machines. Those answering machines were the first real answer to the question, “whatever would you want to connect to the phone network besides a telephone?” Today, it sometimes seems that everything but the blender is connected to the network. Cell phones, computers, alarm systems and gas meters all take or make calls. You might not call a kitchen appliance to “check on a cake in the oven,” but it doesn’t sound like science fiction either. The simple fact is that, like those who designed the standard Strategies for Growth The "Plug- compatible" World 42/99 4028 HDSL2: Interoperability and Beyond electrical outlet, network service providers have no idea what their services may be used for in the near future. Since its inception, HDSL has been a niche technology used for providing T1 service. It was an easy, inexpensive way for phone companies to provide band- width, and users didn’t care how they did it or how much it cost. Service provid- ers owned or leased the copper and provided the termination equipment at both ends, so there were no issues of interoperability. It is tempting to view HDSL2 as a simple replacement for HDSL, providing the same service over one copper pair instead of two. But that would overlook the real future of digital service. As an interoperable service, HDSL2 has the poten- tial to open whole new avenues of growth. As the number and complexity of applications grows, more and more users are finding 56 kbps modem access inadequate. As more employees telecommute and small office/home office applications grow, the distinction between business and residential users is blurring, but one thing they are finding in common is a need for LAN extension. Business users want the same kind of server access in their homes or branch offices that they had at headquarters. Video, once a futuristic fantasy, is promising to becoming commonplace. And gamers, once content with what was available on a single machine, are now meeting others to play, in larger groups, in real time and across unlimited distances. In other words, what was once a voice-only — more recently voice and modem — network, has the potential to become the unified medium for all the world’s data. The backbone is already in place. What remains to be done is to open the last mile and create a common “wall plug.” Today, an international traveler carrying electrical appliances has to bring adapters in order to use local electric power. Imagine the same situation existing within a city or even a neighborhood. Without interoperability, this is exactly what would happen as DSL migrates into network elements like digital loop carriers (DLCs), add-drop multiplexers (ADMs) and channel banks. Each device would need converters, depending on the specific vendor providing the digital service. Obviously, this would hardly be conducive to “explosive growth,” either for the equipment manufacturers or for service providers. Interoperable HDSL2, on the other hand, will enable a new generation of high-speed modems, sub-rate data services and symmetric Internet links. Making the technology interoperable is not difficult. If anything it is more a matter of will than of ability. Critical issues include: • Standardized message sets (tip/ring reversals, loopback activation, loop margins, HDSL2 LOSW and DS1 LOS) • Performance monitoring messages (AIS-CI, RAI-CI and NPRM) • Line coding • Forward error correction • Spectral density A number of vendors have already committed to HDSL2 interoperability and the ANSI T1E1.4 committee is working on the issues. For network builders and service providers, interoperability is an important criterion for HDSL2, but not the only one. But HDSL2 will not operate in a vacuum, so equipment decisions should take into account both the larger Beyond T1 Creating Interoperability The Bigger Picture 52/99 4028 HDSL2: Interoperability and Beyond communication environment and future needs. From the very start, HDSL2 may be delivered alongside other services like ISDN, Frame Relay, PCS and ATM. As a copper- based product, it may or may not coexist with fiber-based services. And, over time, it will almost certainly be superceded by newer copper- or fiber-based services. Communications services, already more competitive than they have ever been, are changing at an astounding rate. Today’s highly profitable service may be tomorrow’s commodity, with razor-thin margins. As technologies change, services compete not just with other similar services, but with completely different ones. Cable TV is challenged by direct satellite broadcast; wired telephony faces off against wireless. The exploding demand for service may make the market look easy, profitable and thoroughly appealing but, in order to survive, service providers have to look down the road. Initial costs are obvious, but what about the less apparent costs of installation, turn-up and troubleshooting? High maintenance costs may not be a problem when margins are large, but those ongoing costs can be brutal when competition puts the squeeze on margins. This is where the “commodity myth” — the mistaken belief that all systems are alike — can set the unwary service provider up for failure. Interoperability does not eliminate the need to compare features. It is a feature, but just one of many that should guide your choice of HDSL2 systems. Collectively, the features of your HDSL2 system will affect your ability to: • Make money by expanding your market and increasing the value of your services • Save money by reducing cost, simplifying installation and maintenance, and eliminating unnecessary labor • Make life easier by reducing downtime, increasing your span of control and simplify- ing migration to future service offerings HDSL2-based services may look like a commodity to users, but for service providers, differentiation will be the key to success. Devices may interoperate, but competition among equipment manufacturers will simply move to a higher level; the platform within which HDSL2 functions. Platforms like ADC’s Soneplex ® system will provide an array of value-added capabilities far beyond simple service delivery. These capabilities will ease installation and simplified maintenance. They will allow remote management and diagnostics, and integration with other services. They may provide increased densities to meet the market’s growing needs within the confines of existing facilities. And they will provide forward compatibility. In short, HDSL2 interoperability will be just another feature within a larger approach to providing multiple, targeted services to meet the yet-undefined needs of an unpredictable and fast- changing market. The right platform will help you make money by: • Providing a wider range of services on a single platform, allowing you to better meet customers’ specific needs • Allowing you to expand systems as they are needed to conserve capital • Letting you install and turn-up facilities faster • Keeping facilities up and running, and earning revenue, using centralized preventive maintenance and troubleshooting • Letting you provide guaranteed service levels to those willing to pay for premium service Beyond Interopera- bility 4028 2/99 Original © 1999 ADC Telecommunications, Inc. All Rights Reserved An Equal Opportunity Employer Specifications published here are current as of the date of publication of this document. Because we are continuously improving our products, ADC reserves the right to change specifications without prior notice. At any time, you may verify product specifications by contacting our headquarters office in Minneapolis. ADC Telecommunications, Inc. views its patent portfolio as an important corporate asset and vigorously enforces its patents. Products or features contained herein may be covered by one or more U.S. or foreign patents. ADC Telecommunications, Inc. P.O. Box 1101 Minneapolis, Minnesota 55440-1101 FAX: (612) 946-3292 From North America, Call Toll Free: 1-800-366-3891, Ext. 3223 Outside of North America: 612-938-8080 Home Page Address: http://www.adc.com International Sales Offices: Brussels, Belgium 32-2-712-6500 • United Kingdom 44-1189 879200 • Dusseldorf, Germany 49-211-530-655-0 Madrid, Spain 34-1-361-01-68 • Sydney, Australia 61-2-9975-1499 • Singapore 65-225-8228 • Beijing, China 86- 10-6500-7001 • Seoul, Korea 82-2-333-8989 • Bangalore, India 91-80-671-0230 • Malaysia 603-254-0025 Bangkok, Thailand 66-2-9595199 • Philippines 632-892-4476 • Sao Paulo, Brazil 55-11-3040-0666 • Buenos Aires, Argentina 541-788-8700 • Mexico City, Mexico 525-658-4519 • Venezuela 58-2-286-1444 • Miami Lakes, FL (Caribbean/Miami) 305-231-8742 • Montreal, Quebec (514) 677-9166 Vancouver, BC (604) 270-1675 Toronto, Ont. (905) 629-3104 • Ottawa, Ont. (613) 599-5729 HDSL2: Interoperability and Beyond It will save you money by: • Integrating multiple services on a single platform to reduce equipment cost • Integrating components which might otherwise have to be purchased separately • Providing maximum density to make best use of expensive central office real estate • Integrating centralized troubleshooting and sectionalization, reducing maintenance cost and eliminating the cost of an overlay network • Allowing remote provisioning to eliminate or reduce turn-up cost • Integrating your service platform with other systems with local and remote OAM&P support • Supporting proactive maintenance with ongoing performance monitoring Finally, the right platform will make your life easier by: • Providing a clear migration path to future service offerings • Giving you the flexibility to change with market demands, competitive pressures and changing technology • Letting you expand or reconfigure the system without incurring unnecessary cost or requiring “forklift upgrades.” Despite the obvious advantages of interoperability for service providers, there will almost certainly be HDSL2 equipment providers offering non-interoperable equipment. Such equipment may cost less than equipment that meets the interoperability standard, but the real cost will be paid in the future. Not only will service providers that purchase such equipment find their future vendor choices limited, but also, their customers will face limits on what, and how, they can connect to the network. As important as it is however, interoperability is just the beginning. “Standardized” HDSL2 equipment will be judged, not only on the equipment itself, but also on the platform within which it functions. In order to win in today’s competitive markets, you need every possible advantage. Interoperability will get you into the race, but integration will help you win. The Bottom Line . such as PBX and DSU equipment. This plug -and- play compat- ibility with HDSL2 will drive an explosion in the demand for HDSL2- based prod- ucts and provide. largely determine how well HDSL2 fits your product mix today and migration path tomorrow. 22/99 4028 HDSL 2: Interoperability and Beyond Traditional HDSL is