Sprint Corp. promised to revolutionize the way people use their telephones, when it unveiled a bold plan Tuesday for a new network that would allow a customer's standard phone line to handle multiple voice calls, faxes and high-speed Internet access simultaneously.
While other companies have been tinkering with components of Sprint's new all-in-one system, the Westwood, Kan.-based long-distance giant is the first major company to bet its entire network on the technology that drives the Internet.
Sprint said its Integrated On-Demand Network, or ION, would drastically reduce the cost of a long-distance call--perhaps by as much as 70%--as well as allow Internet connections 100 times faster than today's 56.6 kilobit per second dial-up modem.
In addition, Sprint's service would also have the advantage of allowing customers to plug in various appliances--beginning with computers and telephones--to a single line.
But residential customers are unlikely to see the service until the end of 1999. Sprint, the nation's third largest long-distance company, said it will initially target business customers, with some specific large corporations gaining access to ION in a matter of months. Small businesses could see the service beginning early next year.
The $2-billion "Project FastBreak," under wraps for five years, underscores the fact that Americans are using telephone networks to transmit data as much as to talk on the phone. In fact, Sprint will likely change the way it bills for the service, basing fees on data transmission rather than per-minute use.
"We know this is new; we know this is momentous," said William T. Esrey, Sprint's chairman and chief executive officer. "We think this opens up a very exciting era."
Significant Hurdles Await Sprint
Industry analysts predicted that AT&T, WorldCom and other telecom giants would inevitably follow Sprint's lead.
Still, Sprint faces several hurdles. Despite success in a yearlong trial, the company has to make the technology work on a large scale. Sprint also must strike agreements with rival local phone companies to share copper lines that lead to customers' homes. Finally, the company has to sell the complicated service to customers, who are already bewildered by the onslaught of new technology.
"We are very, very bullish on this, but there are, without a doubt a few wrinkles to be ironed out," said Andrew Cole, a senior manager at Renaissance Worldwide Inc., a technology consulting firm in Newton, Mass.
Sprint's plan is the first wholesale shift away from the nation's "circuit-switched" phone network, which sends each call on its own line--or circuit.
Instead, ION will embrace the newer "packet-switched" approach, used today mainly by computer networks. With this technology, all information--whether bits of conversations or computer files--can share space on a single line. Voice calls, faxes or Internet access are each divided into "packets" that are sent across the network to its specific destination in a kind of "electronic envelope."
"Think of [a circuit-switched network] as an interstate highway with one car in one lane and having that lane to itself for the entire duration of the conversation," said Josh Howell, senior vice president of corporate marketing for Level 3 Communications, a rival company based in Omaha, Neb. With packet-switched networks, "it's like filling every lane of the highway with hundreds of cars."
Network Powered by New Technology
The network will use a technology called asynchronous transfer mode, or ATM, which organizes and transmits the packets over the network in such a way that allows multiple uses simultaneously.
That will allow customers to carry on multiple conversations, access the Internet and send faxes over the same line at the same time.
Sprint also will use a relatively new capacity-boosting technique, called Dense Wave Division Multiplexing, that would allow one pair of Sprint fiber lines to carry 34 million calls at once.
To build the network, Sprint partnered with computer equipment maker Cisco Systems of San Jose and Bellcore, the Morristown, N.J., telecommunications research powerhouse once owned by the Baby Bell companies.
In developing ION, Sprint patented several other technologies that it said it would license to other carriers.
The backbone of the ION network is Sprint's existing nationwide fiber-optic network but also includes high-capacity lines that extend into 25 major U.S. cities. That number will grow to 60 cities by 1999 and will bring Sprint within reach of a majority of the large businesses in those cities, according to Sprint.
But to finish the connection, Sprint would still need access to plain-old copper phone lines, which are still the exclusive domain of local phone companies, such as Pacific Bell.
