THE FUTURE OF BROADBAND TELECOMS PROVISION IN THE WESTERN ISLES AND ASSOCIATED SKILLS DEVELOPMENT REQUIREMENTS

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________

A DESK BASED RESEARCH REPORT ON BROADBAND TELECOMS IN RURAL AREAS AND RURAL ICT SKILLS NEEDS (WESTERN ISLES OF SCOTLAND) MARCH 2001

WHAT IS BROADBAND?
In layman’s terms, broadband can be equated to a roadway network. The wider and better the road the more traffic it can carry efficiently. The wider and better the communications pipe for 'data' traffic between the Western Isles and the rest of the world, the less the effects of remoteness are and the increased potential for integration into the global Information Society.

TECHNOLOGY TRAFFIC

56K Modem ISDN2 ADSL/Cable Broadband (2Mbps+)

Single track road Double track road M25 around London Los Angeles 7 lane freeways

Report and Research conducted by Michael M Smith, MA MSc, Course Director, BA Rural Development Studies, UHI. Commissioned by The Western Isles ICT Advisory Service.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________

................................................................................................................................................................... 139 Teaching & Learning ...... 162-164 Appendix 1 – xDSL Technologies ...............................................................Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ TABLE OF CONTENTS Management Summary .......................................................................... 165 170 176 177 180 182 183 .......................... Appendix 3 – UXD5 & System X Exchange Information ................................... 24-45 Satellite Broadband ... 13-16 Part 1 Broadband Telecoms in the UK & OFTEL: An Analysis ........................................................................................... Appendix 5 – Applications for Broadband Satellite ........................................................................................................................................................ 46-70 Line-of-Site – NNDS / LMDS ............... 140-150 A Policy Overview ............................................................................................................ ............................................................................................... 17-23 ADSL ............... 129-138 Up-Skilling And Human Resource Development in the Information Age ....... Appendix 7 – ICT Skills Proposals .................................................................................................. 96-104 Broadband Telecoms: Conclusions & Recommendations .................................................... 71-95 Fibre to the Home ............................................ Unlicensed / UMTS ....... 10–12 Introduction .................................................. 109-110 Teleworking & Outsourcing ......................................... 105-108 Part 2 The Information Age: Trends and Opportunities ....................................................................................................................................................................................................................................................................... Appendix 4 – Additional Telephone Exchange Information ............ Appendix 6 – The Development of Teleworking ............................... 151-161 Skills Development: Conclusions & Recommendations .......................... 111-128 E-Commerce & The Digital Economy .................................................................................................................. Appendix 2 – MVL: A Broadband DSL Technology .............................................................................................................................. 7-9 Research Summary .........................

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ .

Broadband Wireless Access was identified as being a cost effective solution with a relatively short rollout timescale. A public-private partnership between the local stakeholders could form the basis of a phased and cost effective rollout of a broadband network into the rural areas. Another issue is the fact that the Western Isles are currently served by microwave links to the trunk network and no undersea fibre link exists. “Fibre to client” strategy Undersea fibre links Broadband wireless access Public-private partnership Rollout strategy ICT skills strategy . The report recommends to implement a strategy to deliver "fibre to the home" and “fibre to the business”. BT. Iomairt Nis) throughout the Western Isles. could form the hubs. The laying of ducting as a matter of course when digging up roads. Such specific ICT skills outlined within the report combined with the appropriate generic skills will potentially provide the catalyst to enable a transition in the Western Isles workforce to one compatible and indemand within the new ‘Digital’ economy. has installed a fibre network to strategic points in Stornoway but this does not link to any other locations in the Western Isles.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Management Summary Introduction As evidenced by a multitude of developments.the Information Age. A second supplier. Main locations such as schools. A pilot project targeted at those individuals on the ICT skills register and school leavers could be progressed. It concludes that early adoption of fibre technology could deliver lasting and radical social and economic change in the Western Isles. new business and housing sites is recommended as a strategy to speed up connectivity of homes and offices with minimal cost implications. which will ensure that the early foothold which the Western Isles have gained in the Information Age continues and increases apace to the benefit of future generations. To achieve this goal the Western Isles should link into the main trunk services in mainland Scotland via undersea fibre links. Thus. Findings and recommendations The report looked at the currently available broadband technologies and some that are just beyond the horizon but may come to the fore soon. Throughout the islands there are 35 telephone exchanges. For the Western Isles this provides a unique opportunity to capitalise on these advances in a way that can provide for future economic needs. Further research needs to be done in this field.g. health centres. Situation in the Western Isles today The Western Isles are currently served by one dominant telecoms supplier. The report further recommends consideration of the strategy adopted in other rural areas where any upgrading and repairs of roadworks or relaying of sewers. This report was commissioned to facilitate early adoption of the most appropriate infrastructure investments. demanding ever higher bandwidth. particularly if growth in the ICT sector continues at the rapid rate experienced in recent years. We need to be able to both anticipate and capitalise on ICT developments in terms of creating jobs and a higher standard of living for residents of the Western Isles. pavements. of which 28 are an older technology1 with limited ability to be upgraded to meet future demands. power or gas. which would enable broadband services to eventually extend to households and community focused centres (e. It is becoming widely recognised that for participating in this new age a broadband telecommunications infrastructure is the essential enabling technology. include the laying of suitable ducts to distribute fibre cables. etc. society is now rapidly progressing into a new era . The study revealed that the current trend lies in optical fibres and this may therefore limit the islands’ ability to implement broadband technologies of the future. An opportunity exists to focus on in-demand ICT skills to plug the developing skills gap and encourage specialist teleworking and outsourcing teams to become established. water services. This was seen as complementary to fibre and a possible interim or transnational solution.

Apart from their generic application as key transferable skills. they . Following the successful completion of the programme the whole of the community will benefit actively from the proposed developments. such as the Council. education and local businesses. Recommended stages: Immediately Adoption of strategy Rollout strategy (ongoing) Wireless access Undersea fibre connection to mainland 2002 2005 Fibre to the home/office 2006 The most laborious and time-consuming aspect of the proposal is the laying of underground ducting and fibre. Skills in the Information Age It is equally important that the skills requirements that come with the Information Age are understood and met. in teleworking opening up. by removing geographic boundaries.g. health board.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Timescale With recent changes at both regional and national levels there is a genuine willingness to stimulate radical change in the islands and to transform the economic outlook. Once fibre is in place. termination equipment can be upgraded as need commands. with new opportunities e. Stakeholders and Beneficiaries Adoption of the above recommendations would elevate the Western Isles to be recognised as a location where two of the most important advantages of the Information Age could be combined: Φ Φ "quality of life" location "high bandwidth" connection to the international community Being a highly marketable branding for "connected communities" these factors would enable us to attract inward migration and inward investment. The report has identified the following core skills as being of relevance to the requirements of the emerging new marketplace. The stakeholders and beneficiaries in this development would in the first instance be the main employers and service providers on the island. The local community will at this initial stage be a passive beneficiary. yet increased access to better and faster services will be developing. Great time and expense has been devoted to giving people basic ICT skills to participate in the Information Age. However the report found that more specialised and refined skills need to be developed in potential employees of an IT-based economy. The study undertaken predicts that the infrastructure proposed would continue to deliver gains for 20 to 30 years. With an immediate adoption of a broadband strategy the various stages of implementation should be carried out over the next 5 years.

online team building) Attitude & enthusiasm (e. online collaboration) Problem solving Business awareness (e. is essential. In terms of scheduling developments. Monitoring & Review Policy The fast rate of change in the technology sector means that a constant review of policy and changes to meet new requirements are an essential element of continued success. overcoming technophobia) Technology skills (e. Employers will find a high quality and productive workforce and potential employees will have acquired the skills which will ensure they are more marketable and have the capacity to increase their earning potential. Early embedding in the education structure.g.7M persons. It is not unreasonable to suggest that everyone gains from acquiring the recommended skills. emerging new technology) Within the next 3 years there is estimated to be an ICT skills gap within the EU of approximately 1.g.g. Web presence of companies) Creativity & innovation (e. specific training on the above topics is expected to show results within a very short timescale and can run in parallel with infrastructure development.g.g. however. national and international basis.g. as well as reviewing the adopted policy is conducted on an regular basis. . possibilities of emerging software) Inter-personal skills (e.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ • • • • • • • • Written & oral communication (e-communication) Team working (e. It is therefore recommended that monitoring developments on an regional. This is as much the case with telecommunications bandwidth as it is with skills requirements.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The Future of Broadband Telecoms Provision in the Western Isles A Desk Based Study Broadband Telecoms Research Summary The following section summarises the result of deskbased research and monitoring in the Broadband sector. particularly with regard to 3G mobile services. which never achieved full market penetration. understanding trends and relating them back to the context of the rural Western Isles. with the latter being the seemingly ‘dream’ solution. although limited. ISDN will however. service option for some time. broadband wireless. remain a useful. DSL. it was a good example of an advanced interim technology that never achieved full market penetration. . with the latter being the seemingly ‘dream’ solution. The US is several years ahead in its approach to recognising the need for broadband provision in their principle of Universal Service in rural areas. the new generation of broadband satellite. noting the approach and policy applied in the US and comparing their approach with ours. ISDN received only a fleeting mention. although limited. compared to competing technologies. A desk based study assessing developing technology and trends in the Broadband sector and relating them back to the context of the Western Isles. remain a useful. cable was considered to be an unrealistic option in relation to its level of service. as a good example of a seemingly advanced interim technology. In view of the costs. 3G mobile and broadband satellite will inevitably be rolled out in our broadband future. It would appear that the US is several years ahead in its approach to recognising the need for broadband provision in their principle of Universal Service in rural areas. broadband wireless (licensed/unlicensed). The nature of the level of service and its applicability to our broadband future remains unanswered at present. In the UK the current OFTEL regulations do not provide for the provision of Broadband services to The report considers the key broadband technologies rural areas potentially applicable to an Island area such as the Western Isles. 3G (Third Generation) mobile and fibre optic cable were ultimately settled upon for consideration. ISDN received a fleeting mention. Some key areas of research into factors such as demand for broadband were out-with the scope of the study due to limited resources. The report reviews the role of OFTEL and its policy framework in relation to the rollout of broadband provision to peripheral areas such as the Western Isles. ISDN will however. DSL. assessing developing technology. In the UK the current OFTEL regulations do not provide for the provision of Broadband services to rural areas. the new generation of broadband satellite. 3G mobile and fibre optic cable were ultimately settled upon for consideration. All-inclusive coverage remains an issue in sparsely populated areas. service option for some time.

ADSL was considered less than optimal. With costs falling to being on par with replacement copper or ADSL rollout a key development opportunity appears to have presented itself. although it was concluded that an all-inclusive service would be an interim solution in the longer term in our digital future. with initial costs perhaps being borne by the public sector to key locations Islands-wide appears to have much scope. The current licensing situation in the UK was reviewed as was the developing technology. Other telecoms operators in the US faced with similarly ageing telecoms infrastructure not able to provide broadband services without upgrading. became increasingly clear. became increasingly clear.a cost effective solution with a relatively short rollout timescale. have instead migrated direct to replacement fibre. century. Broadband Wireless Access . Innovative partnerships utilising variant xDSL technology could still provide potential. fibre-to-the-home/fibre-to-thebusiness was shown to be the ‘killer’ broadband solution capable of instigating lasting and radical social and economic change in the Western Isles of Scotland. In addition.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Consideration of (A)DSL raised many issues which would need to be dealt with regarding the capacity and ability of the existing exchange and copper infrastructure network in the Islands to enable its rollout. the potential development gains from the early adoption of a long-term Information Society enabling infrastructure. An innovative build-out through public/private and even community partnerships was considered possible. as it would not be able to achieve radical and lasting change in the development of the islands. fibre-to-thehome/ fibre-to-thebusiness was shown to be the ‘killer’ broadband solution capable of social and economic change in the Western Isles. innovative partnerships utilising variant xDSL technology could still provide potential. Broadband Wireless Access was identified as being a cost effective solution with a relatively short rollout timescale. While ADSL technology was considered to be less than optimal. social and of further research and economic change in the Western Isles for the 21st testing. As the study progressed. the increasing magnitude of the economic and social development attainable by the rollout of the appropriate broadband solution for a remote rural area such as the Western Isles became increasingly apparent. The potential development gains from the early adoption of a long-term Information Society enabling infrastructure. Examples of successes elsewhere in both urban and rural areas across the globe were highlighted and several differing models in the licensed and unlicensed bands examined. Telecoms operators in the US faced with similarly ageing telecoms infrastructure not able to provide broadband services without upgrading have instead migrated direct to replacement fibre. as it would not be able to achieve radical and lasting change in the development of the Islands. In this respect. An opportunity for an innovative fibre-development partnership. . There appeared to be some mileage as an area of further research and testing. An innovative build-out through public/private partnerships was considered possible. In this respect. There appeared to be The early adoption of a fibre optic network was identified some mileage as an area as being the key to deliver lasting and radical.

social and economic change in the Additionally. The National Gaelic Resource Centre in Lochs. Undersea fibre optic cable to the mainland and between the islands was considered an essential progression towards long-term connectivity requirements of future generations. it was noted that the timing of the report was opportune. the Western Isles should link into the main Western Isles for the 21st trunk services in mainland Scotland via undersea fibre century. The early adoption of a fibre optic network was identified as being the key to deliver lasting and radical. Uig Community Centre. with the Islands achieving a profile in the broadband sector similar to that of Skye in the Tourism sector. investigations into existing infrastructure and the opportunities it presents are recommended and a series of pilot projects to strategic points in the Islands presents an obvious opportunity for progress. optic cable. The Harris Genealogy Centre. social and economic change in the Western Isles for the 21st century. A second phase could then enable a build out into surrounding communities and ensure equitable access to all residents and businesses in the Western Isles. Iomairt Nis. . There can be little doubt that such a radical and innovative approach to economic and social development via broadband provision would provide enormous marketing opportunities upon which to attract inward investment and stimulate re-population and new enterprise. in addition to Stornoway could all be feasibly targeted for broadband fibre.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The early adoption of a fibre optic network was identified as being the key to deliver lasting and radical. enterprise. As stated above. Garenin Village. At least one other local authority has already made such a policy decision relating to the laying of ducting in all new developments and upgrading/repair works undertaken throughout their Islands. The FE Centre in the Uists. would be achievable. The Western Isles should link into the main trunk services in mainland Scotland via undersea fibre optic cable. Radical and innovative approach to economic and social development via broadband provision would provide enormous marketing opportunities Undersea fibre optic cable to the mainland and between to attract inward the islands was considered an essential progression investment and stimulate towards long-term connectivity requirements of future re-population and new generations. Taken together with a series of opportunities that the writer termed ‘the holy grail’ of rural development. Finally. given recent discussions and encouragement at the regional level for a radical approach to rural development to be pursued within the Western Isles. Barra Learning Centre and a range of other key public sector service provision sites. The timing of the report is opportune with encouragement at the regional level for a radical approach to rural development to be pursued within the Western Isles. Digital inclusion is a key aim of any broadband rollout.

Indeed. along with a number of other European counterparts. targeting and rolling out this provision will be the main enabler upon which skills development can be encouraged and targeted to further optimise the ‘development’ environment. In terms of rural development. The UK has overall been slow. A concentrated focus on related IS ‘development’policies targeted at developing broadband communications and enabling associated skills development can. at adopting new broadband technologies and addressing predicted IS skills shortages. The development of the Information Society (IS) is increasingly becoming the single biggest instigator of social and economic change not only within Europe. in part 1 of this report an allimportant focus on the competing broadband technologies will be undertaken with comment on their relevance to the rural and Western Isles context. There is a clear opportunity to transform the existing stagnant rural economy of the Islands into a key development zone for the developing Information Society. It follows that in such a context the ‘early adopters’ / ‘early market entrants’ will be able to establish a growth base. providing the appropriate ICT infrastructure is secured at the regional level. As a result. it is assumed. in part 2 a consideration of the new opportunities broadband will bring and associated new ways of working will be progressed. In the US (our main competitor in the Information Society) it is estimated that within 2 years 50% (130M) of the population will be connected to ‘the Net’ bringing a whole host of new mass-market opportunities requiring new ways of working. the key to enabling a competitive Europe is increasingly focusing the provision of future skills requirements and also on the technology (e. Developing on this context. Ultimately. Then. followed up by a discussion on the much publicised e-commerce revolution and the development of the digital economy.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Introduction New work practices involving networked and convergence technologies are predicted to affect every working person in the EU over the next 5-10 years. but also worldwide. provide the basis for the Western Isles to become one of the ‘leading lights’ in rural Europe for the creation of new ICT related enterprise development and job creation. changing the way both businesses operate with their customers and suppliers. Such a Europe-wide focus is also applicable at the regional level as we move towards a way of working which will increasingly gravitate towards people rather than place. . Information Society developments are considered to be very much part of the solution to Europe's ongoing unemployment and competitiveness problems in the next 5-10 years. Such new ways of working and operating will require new skills and competencies and an increasingly adaptable workforce. broadband) used to enable it. In relation to methodology this report will set the Information Society in context to establish the economic and social dimensions of the change which one might anticipate over the next 5-10 years.g. Given such background. by which future development momentum can be driven. the rationale for this study becomes immediately apparent to the reader. it is the presupposition of this report that an area such as the Western Isles can get a ‘jump’ on the regional. national and indeed international competition.

In recent years the focus of this change has become increasingly apparent and very much centered on the development of the so called Information Society or as others refer to it. as there has been some debate as to where such economies will focus their future activity. The securing of an appropriate broadband rollout. followed by a contextual analysis of skills development in consideration of the opportunities and findings identified in part 1 of the report. It needs to be recognised that this change is recent. The Highlands & Islands economy for example became increasingly service based as the 1990s drew to a close. increased enterprise formation and opportunity growth. one might argue that there will be significant dividends to be accrued. inward investment. The main premise of this report is that this is a real and currently occurring change in society within which ‘early adopters’ will have a distinct advantage. What specific evidence can we refer to. In the context of this report we are talking about job creation. rises in average income. population growth. only really gathering momentum in the second half of the 1990s. in line with the focus outlined. in combination with an associated human resource development strategy will arguably provide the key base infrastructure to enable a maximisation of economic and social benefit in the study area. An increasing focus into the service based industries has been apparent with a significantly less reliance on heavy industry and manufacturing. For those communities and regions that recognise the future the specific development needs and requirements. are all achievable through concentrated development policies in the Western Isles in advance of the developing IS. It is the presumption of this report that a significant rise in average incomes associated with increasing economic and social opportunity. What is the Information Society? In the latter years of the 20th century it became obvious to many agencies. to enable sustainability in the longer term. a resulting reversing of population decline and a significantly increased rate of inward investment. researchers and academics across the globe that the West was increasingly moving towards what was commonly termed the post-industrial society. an excess of 70% of activity being attributed to this sector! The generality of the term ‘post-industrial’ was used. This term was used to convey the level of structural change that was taking place in Western economies right across Europe and North America in particular. To close out this part of the report an overview of developing policy for the IS will be reviewed. In identifying this . the Information Age. what one might refer to this as the achievement of significant and lasting rural development. improvements in leisure & recreation and social possibilities. a goal as yet not able to be achieved in the Western Isles context in living memory. Overall.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ A consideration of teaching and learning opportunities will then be reviewed and a final focus of health telematics as a further practical example of where early progress can be achieved in the rural context will be discussed. whatever form this may take. to support the concept of our increasing move towards the Information Society? A number of trends quite clearly illustrate the factor which are combining to rapidly lead us towards the impending Information Society.

CD/music players. which increased choice and reduced prices for consumers.etc Attitudes towards technology have changed significantly during this period. PCs by the late 1990s had. new concepts of time & space. This phenomenal growth occurred just several years after the liberalisation of the telecommunications markets. with approximately 500M worldwide. customers are increasingly being involved in the ‘work to be done’. The development of ‘Bluetooth’ and ‘HomeRF’ standards both steering us towards an increasingly ‘wired’ or more literally ‘wireless’ future. [Botterman & Johnston 1999] will need to be addressed. where flexibility is a requirement and the around-the-clock provision of services a universal expectation. learning and leisure demands.g. whilst in some of the Nordic countries this figure was closer to 1 in 2 on average. TVs. customers/clients.. personal home services (e. home banking. personal organisers/pocket PCs. The banking sector is a good example where first the ‘hole in the wall’ increased both the involvement and access to services and now the Internet allows on-line banking enabling the customer to both monitor and manage their own accounts directly. Within this context there is an increasing level of (wireless) convergence between elements of this new society. Utilising this technology. As such. cameras." [Botterman & Johnston] No longer will small businesses need just to focus their activities locally. which requires being inclusive for all. with another shining example being the growth in mobile telephone use which the public has embraced to the extent that by Christmas 1999 it was estimated that 40% of the UK population possessed such technology. an everyday tool of both the home and workplace. mobile communications devices. competitiveness and overall business performance. with the concept of e-commerce being of growing importance. suppliers…etc. are having a deep-seated and largely beneficial effect on economic productivity. and ITs in particular. and continue to be. with impacts on (a subject to be discussed in detail in chapter 8) employees. PCs. to fulfil work related.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Society has changed in so far that during the second half of the 1990s the public began to change from being ‘passive users’ of PCs and telecommunications to become ‘active choosers’ of PC and ICT technologies. there are increasingly few instances where businesses and homes are not at the very least employing some new element of the developing ICT revolution. The Information Society is about new ways of working. used for business. education.. From the business perspective: "There is now little doubt that new technologies in general. work & leisure and family & community. businesses. the internet.. video-cameras…etc which are all increasingly ‘talking’ to each other. issues characteristic of societal change. on average. Clearly. between broadband telecommunications.etc) entertainment. In unison with such developments we have an increasing move towards a 24-hour society. 1 in 4 of European households owned at least one PC.. . travel booking services. By 1999. as more flexible access to key services become apparent. as global market knowledge and low costs of entry into the marketplace enable a much wider ‘net to be cast’ in searching for new customers.

with a further 17M people planning to use a new technology product for the first time in the next six months! “Such global trends promote a stark message for European nations such as Wales. with the US estimating over $200bn by 2001. In addition a recent MORI poll in the UK revealed 15M home PC users (of which 1/3 have purchased goods/services on-line and a further 1/3 undertaken banking transactions) and 14M mobile phone users (now in excess of 20M). it is also noted that a community's culture and attitude will also be of note.e. One of BT’s policy advisors at an industry conference also highlighted the choice ahead.” The need to access broadband and develop the ICT skills based is thus clear for rural areas such as the Western Isles and it is the potential route to both we will examine in the following chapters. The message is join the information society or become a peripheral player.European internet revenues: $1bn in 1998 to $64bn by 2001. in this instance for Wales (which already has a more advanced infrastructure than in many other parts of the Highlands & Islands) in consideration of recent trends i. increased access to an advanced ICT infrastructure that is able to support and deliver a wide range of services and thirdly a strong local and regional supply of ICT services and access to electronic content. .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ According to the DTI there are several driving forces that are integrating together which are leading us towards what they term the Information Society. In addition. Secondly.. education and willingness to innovate…etc. In this sense the message is clear and the focus and rationale for the following study self-explanatory. including language. Firstly the DTI identifies growing overall income levels that in turn has translated into an increasing demand for goods and services. who possess sophisticated telecommunications infrastructures but have limited success in utilising them.

e. The results of this analysis and associated comments will determine the approach to later sections in this chapter." 1. according to OFTEL's own forecasts in 1998/9. It is headed by the Director General of Telecommunications. to ensure a 'universal' service within the UK. predominantly BT. low-user schemes) perhaps. It describes its main objective as being for: "…customers to get the best possible deal in terms of quality. or lack of them. Given this dual role. OFTEL. in many characteristics a unique entity. issues a license to the telecoms operators with USO (and other scheme) safeguards built-in. rather than the cost BT incurs in delivering universal service. due to issues of affordability.g. Indeed as OFTEL itself states: "It could also be argued that OFTEL should be examining the cost of universal service to an efficient operator. a consultative document was issued by the Director General of Telecommunications in OFTEL entitled 'Universal Telecommunication Services'. OFTEL describes itself as being a government department that is independent of ministerial control and in this respect. In July 1999. there was in actual fact only a minimal. as it raises many issues for rural areas and provides an up-to-date view on current policies. universal access at an equitable price to the existing and developing telephone network was considered to be essential for all taxpayers so they could communicate with others in society no matter what their location.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ PART 1 Chapter 1 1 Broadband Telecom Services OFTEL and the Universal Service Obligation OFTEL can be thought of as being the regulator of the UK telecoms industry. cost to BT in the USO (refer to Box 1). Part of its remit also includes Broadcast services. to formulate 'special schemes' for particular elements of the population who for one reason or another are having difficulties remaining connected (e. it has also been a common feature of OFTEL's operations to work with the telecom service provider(s).1 OFTEL's Universal Service Obligation (USO) is a common feature of other telecoms regulators around the world and is ultimately present to ensure social and economic inclusion within the new developing Information Society. It is this document that will be the focus of comment throughout this section. the USO) in the license and the operator (BT) must pass such costs on to the consumer. it has a key role in the development of convergence technologies in the UK. In the past. in effect. social status or age and/or disability." . most commonly. According to OFTEL there is a real cost in providing such safeguards (i. who is appointed by the Secretary of State for Trade and Industry. choice and value for money. aimed at ensuring the rollout of Broadband services to those persons living in rural areas. if existent at all. However. In addition to basic access guarantees.

e. standard telephony lowincome consumers) to the benefit of those with higher disposable incomes.2 Regardless of such issues. as the development paradigm in our society moves increasingly towards sustainability. .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ It qualifies such a statement by indicating that BT has a significant resource of 'fixed radio access' for which it has even been awarded spectrum. The US has for some time been investigating this very issue to ensure 'digital inclusion'.g. in rural areas. on the other hand. This. Brand Image) Source: www. OFTEL does not believe that it is necessary to re-evaluate the costs and benefits of the USO at this point in time. combined with an anticipated increased need because of a higher basic subscription cost for broadband services does not easily lend itself to a clear cut solution utilising the Universal Service model to address inclusion issues. contends that if the USO were to be extended to cover broadband services. There is without doubt a valid issue here related to the subsidisation of higher cost broadband services by those people who cannot afford them (i. perhaps indicating a commonly held underlying viewpoint i. it is important to remember that it comes at a price. of ADSL) with future revenue streams being uncertain at a time of developing and competing technologies then once again the problem of cost and subsidisation of 'uneconomic' locations becomes further complicated. Yet on the other hand." In context. that the USO is not in actual fact a burden. in situations where it was 'the least cost technology' then significant efficiency savings could be realised in servicing both 'uneconomic' areas and customers. Ubiquity. BT is quoted as making a profit of £105 every second*. offering its telecom services at a 233% mark-up. This may even apparently require an increase in basic charges for all.** BOX 1 Universal Service Costs/benefits Universal Service Costs / Benefits 1998/9 Uneconomic Areas Uneconomic Customers Uneconomic Public Call Boxes Total Costs Benefit (Life Cycle. then one could argue a private company (with an effective monopoly) providing a basic (utility) service to potential members of a new Information Society should be expected to forego an element of short-term profit for the benefit of society and longer term gain.oftel. and therefore ultimately be to the wider detriment of society. Yet. Thus the apparent costs of the USO to BT could be reduced significantly according to OFTEL projections. BT has made only minimal use of its spectrum resources to date. contrary to what OFTEL appears to state: "Although universal service provides an important safety net.uk £Ms 5-10 38-48 10-15 53-73 61 1. the key argument against this would be related to the escalating costs that would require cross-subsidisation from existing services. With regard to cross-subsidisation within existing broadband users (e. to qualify its analysis. a number of which were clearly raised by its own staff.gov.e. If introduced in the local loop.

In policy terms the report quite clearly indicates that the USO is not likely to change in advance of societal change: "Universal service is about finding ways of meeting the needs of those remaining few whom the unregulated market might choose not to serve.. This could act as an inhibitor of new technology solutions and a 'barrier to entry' into the marketplace for new telecom operators. On the other hand. Firstly. It is only in instances when certain "telecommunications services that are used by the majority" become prevalent that there will be an obligation." A key issue then relates to the interpretation of the objectives of the Universal Service. Neither is it about prescribing what is required for future economic growth and prosperity. via the USO.e. Although. the key questions that OFTEL recognise as needing to be addressed in the report relate to several key issues. the related lack of competition in the 'local loop'. That would not be "universal service" as currently understood and funded. the cost and fairness implications on existing telecoms suppliers. be it urban or rural and the development of a two-tier Information Society of 'haves' and have-nots'. ADSL) on a limited number of telecoms providers would be in itself become untenable without a wider extension to other broadband technologies. Cross-subsidisation in such an instance would not be necessary. the USO's application and extension on BT cannot be viewed as a potential developmental opportunity for communities currently excluded from access to broadband services which are not yet used by the majority in society. determined not to intervene. as broadband communications develop via a range of different technologies (wireless. to ensure wider social and economic inclusion. satellite. and secondly the appropriateness in policy terms of extending the USO to broadband technologies in advance of future changes in society.etc) then the justification for a Universal Service on existing copper wire based solutions (i. being deliberately reactive to change.3 In summary then. .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ A long-term consideration of the business-cycle would view such potential USO obligations as an investment rather than a cost. The rolling out of copper-based solutions to even commercially attractive locations has been slow to show progress. 1. In such a situation. as discussed above. In this sense the OFTEL/(BT) interpretation is without doubt valid. hence negating OFTEL's key argument against extending the USO to broadband services. cable. the Labour chancellor Gordon Brown (March 2000) has also been publicly applying pressure to BT/OFTEL about the UK government's frustration regarding the lack of development in the UK telecoms (broadband) sector in general. In other words. but hardly progressive in nature.. one could argue that as a result of the interpretation of the current objectives of the Universal Service 'noncommercial' locations will always be caught in a 'catch-up' loop and hence be of little value in practice to excluded communities. It is not about predicting what will be required in the future and requiring it advance.

. On-line Education. Video Conferencing. video on demand as there are few rural cinema and video hire shops. Home-based working and interactive access to other local services related to health (Medical Imaging and Consultation).Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Universal access for consumers to the broadband information society is also desirable to enable the UK to expand at the forefront of technology based development and to make commercially viable an increased range of products and services to such consumers. Business usage is also limited. Market intervention to achieve such goals it can be argued. wired into future mainstream product and service provision. rural society and overall ensuring social and economic inclusion for all in the wider UK context. is therefore not interference to the detriment of all in the long term. Innovations in the provision of Video on Demand. but actually quite the reverse. Indeed. populations are more spread out. in the view of the writer. Video e-mails. Online Shopping.e. social services and local authority functions together with high speed access to the Internet and World Wide Web.4 Rural areas are without doubt more costly to service. arguably it is the rural or traditionally excluded consumer who proportionately is going to consume such products and services at a higher level i. Access to new interactive products and services via ADSL is not a short-term reality for 'uneconomic' areas. This 'critical-mass' effect as it is referred to in the report however is not one OFTEL considers relevant within the scope and remit of the USO as it stands and therefore not grounds for further intervention in the telecoms marketplace. Currently the parameters of the Universal Service on BT are unlikely to change to ensure access to new copper-based broadband services for the reasons discussed above. with negative implications for the development of an inclusive rural society in the UK. On-line Banking. In the 'free-market' model such uneconomic areas would be left to their own devices. But this is not an acceptable political reality in a post-industrial 21st century 'developed' UK society increasingly embracing the principles of sustainable development and consequently being committed to conserving regional distinctiveness. will by-pass such areas who will get no input to their optimum development path due to lack of initial access and hence influence. whereby rural telecoms infrastructure is caught in a perpetual cycle of catch-up with that in urban areas. The European Union's Regional Policy operates on just such principles. 1. due to the increasing timescales required just to access yesterday's technology. the physical distance from the local exchange (3. actively working towards a society where each and every citizen has an equal opportunity to participate in the economic and social life within the '21st century' society in Europe. further affecting the revenue stream. This is not only an uncompetitive situation but also given the rapid level of change in the current sector one which is arguably not sustainable. despite the perceived need in uneconomic (rural) areas.5 – 4. Even if one accepts that the USO is not the most appropriate means to achieve such intervention with OFTEL's current interpretation of its objectives.5km depending on line quality is the quoted current limit of ADSL) and cost constraints associated with infrastructure development in 'wilderness' areas are high and the number of consumers low as are the subsequent revenue streams. This is a convenient interpretation once again. On-Line Gaming. this report will nevertheless argue strongly that intervention in the telecoms sector to achieve wider social and economic goals will be essential to avoid the current impasse.

OFTEL has also noted that as BT supplies 85% of such lines in the UK. less viable exchanges first in many instances. These communities need to know what technologies and applications are available. Promotion of community partnerships. to which the present government is so committed (http://www. U. 3.We need to ensure that inner city and rural residents are informed about the opportunities that exist and the best ways of harnessing them for their communities. including services like high-speed always-on Internet access and video-on-demand. Assistant Secretary for Communications and Information.S. 2. the unbundling of the local loop to promote competition could achieve real competitive gains and therefore negate any potential bottleneck holding back the development broadband technology over the existing copper line network.gov. According to Larry Irving.7 Finally. In addition. Department of Commerce (1995): "We believe the following four goals are essential to promote universal and equitable access to the National Information Infrastructure:" 1. arguably. that the American government has been much more forward thinking in its consideration of 'Universal Service' and as far back as 1995 prioritised a new and advanced USO including provisions for the socially excluded.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ This latter fundamental issue is the basis upon which an increased level of public assisted projects must be secured. a process known as local loop unbundling. "On Friday 10 March 2000 OFTEL began a statutory consultation on a proposed modification to BT’s licence. It remains to be seen whether co-location as its terms and conditions exist at present will be the catalyst for competitive broadband provision of the nature envisaged by OFTEL. Preservation and advancement of the concept of universal service. but has instead opened up.oftel. and Outreach to under-served communities. it is interesting to note however. yet the potential gains realisable in a potentially location-independent economy for those 'included' could be a massive boost to the rural economy as traditional industries continue to decline. £30K per user based on seven sharing) in single-supplier rural exchanges. and what has worked for similar communities." 1. The risks associated with a continuing non-proactive stance could be significant." – www.. The purpose of the proposed modification is to require BT to allow operators to lease its local access lines.gov. . "OFTEL is committed to ensuring that UK consumers and businesses are well placed to make use of new Information Age technologies that will deliver these services.dti.uk/infoage/index. BT has also in practice ‘dragged its feet’ in the words of one potential ADSL entrant (RSL Communications) which along with several others have now pulled-out of the market altogether. At the time of writing there has been little progress with co-location space-related issues in the popular urban exchanges and high costs (approx.uk The development of 'affordable' broadband in the UK will be the catalyst for the growth of e-commerce and the electronic economy. BT has not responded to demand from potential entrants for exchange space in key areas. 4. OFTEL is convinced that the main route to broadband access in the UK will be via DSL technology utilising existing copper-based telephony structure. what existing infrastructure they have and need.. Continued support for universities and research institutions.htm). Operators would then be able to use their own DSL technology to provide broadband services to customers. 1.6 In the short term.

" Nevertheless.to have home Internet access than those in urban or central city areas. a further report in July 1999 has concluded that rural areas in the US are contributing significantly to their 'digital divide' – "At every income level. some might argue it is already happening. Advances in communication and information technologies. households in rural areas are significantly less likely . Indeed the Countryside Agency in England has requested that OFTEL widen its USO to include broadband provision to rural areas. and an exodus of talent. however. . low workforce participation. A similar process on a national scale has just been completed in the US with the subsequent report 'Advanced Telecommunications in Rural America: The Challenge of Bringing broadband Service to All Americans' being published in April 2000. and concluded: "Government regulations and policies will also play an essential role in the development of the Rural Information Infrastructure. At the time of writing there has been no response to this request.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The US government's report from which the above originated in 1995 began with the following key quotation and the situation it describes across the Atlantic in 1991 is reminiscent of many areas in the Highlands & Islands today : “Many of America’s rural areas show signs that raise concern for their future: loss of economic vitality. The momentum of the so called Information Age or Society is clear and there will be many opportunities for UK business and consumers alike that will have economic and social consequences in all walks of life.sometimes half as likely . despite the occasional comment on social inclusion and increased access to the communications network. Both the opening quotation and conclusion of the original report discuss key areas that the UK government are still reluctant to address. For this reason it is essential that we now consider the options for such areas to enable them to become wired into the impending Information Age. even with this recognition. The next chapter will begin by assessing the services available by firstly considering the competing DSL broadband technologies relevant to the rural context. This report also considers many of the issues outlined in this report. The commitment is real. but the question of inclusiveness remains for 'uneconomic communities' in the UK (at least 5 years after the US government began to address such impending issues) be they in low income urban housing schemes or scattered remote communities in the Western Isles of Scotland. a relative decline in income. can reduce the barriers of distance and space that disadvantage rural areas" (Office of Technology Assessment." One wonders if the UK is willing to take action now to avoid this inevitable scenario being replicated this side of the Atlantic in our rural areas. Congress. 1991).S. One might easily conclude that OFTEL requires to be much more flexible in its interpretation of its Universal Service obligations. U. high unemployment. Different regulations and policies will likely be required in rural areas than in urban areas.

of Commerce.digitaldivide. (1997) http://www.gov/ntiahome/digitaldivide/factsheets/rural. of Commerce.htm US Dept.uk/consumer/uniserv2/chap1.bldrdoc.htm OFTEL. Survey of Rural Information Infrastructure Technologies.htm US Dept. Access to Bandwidth Consumer Workshop (March 1999) http://www.ntia.uk/consumer/uts799.oftel.oftel.gov/ . (1995).uk/isp/a2bwshp. Universal Telecoms Services.htm OFTEL. http://www.gov.gov/pub/rural/ US Commerce Department's National Telecommunications and Information Administration / Rural Utilities Service Advanced Telecommunications in Rural America: The Challenge of Bringing broadband Service to All Americans (April 2000) http://www. Universal Telecommunication Services: A consultative document (July 1999) http://www.doc.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Chapter 1 . Access to Bandwidth: Delivering Competition for the Information Age. Rural Areas Magnify 'Digital Divide' (July 1999) http://www.uk/competition/a2b1199.gov. (November 1999) http://www.gov.References: OFTEL.oftel.its.gov.oftel.htm OFTEL.

The element of the line concerned with data download and upload is described as being 'always on' i. xDSL refers to an increasing number of digital transmission technologies utilising POTS to provide high bandwidth information services to small businesses and increasingly consumers’ homes. PSTN – Public Switched Telephone Network ISP Server ATM Local Telephone Exchange with DSLAM Voice Calls ADSL Modem Rack User's ADSL Modem Existing Copper Pair Line 1. The local exchange is then able to switch a request for information (from your DSL modem) down the telecom suppliers 'backbone' communications infrastructure to your ISP. As indicated in the last chapter. Refer to Appendix 1 for details on the full range of developing DSL technology worldwide. BT is only now in 2000 beginning to roll out ADSL services throughout selected sites in the UK after much delay. 2. DSL refers to the modem pair (at the consumer and exchange ends) rather than the lines used. The availability of such services is not as straightforward as it might first seem and we will consider specifically in this chapter the kind of issues that need to be addressed if the most appropriate DSL service in the Western Isles context is to be achieved. as the service becomes more affordable and widespread in both Europe and particularly North America. the DSL modem used to connect to the data service is permanently connected to your local exchange.1 DSL: An Overview At its most basic level a DSL can transmit and receive both data and voice signals on the same line.5Mbps to 7Mbps 16kbps to 640kbps The Internet Box 2 ADSL .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 2 Competing DSL Technologies POTS. engaged tones.. technically. via its high bandwidth link 'pipe' and then on into the Internet through its own 'backbone' communications infrastructure on into the Internet to access your desired location.etc.e. Indeed. dropped lines.. the Plain Old Telephone System is the basis for the majority of xDSL (Digital Subscriber Line) services on the market today. Connecting to on-line services therefore becomes that much quicker without the experience of a 'dial-up' process.

Modems demodulate analogue signals into a string of values of 0s and 1s (i. the modem modulates the digital signal and sends it as an analogue signal. and let's be clear." [http://whatis. which home users in the UK have been purchasing at an ever growing rate to address their . With DSL: "Digital data is transmitted to your computer directly as digital data and this allows the telephone company to use a much wider bandwidth for transmitting it to you. On the other hand. The reason BT is deliberately slowing down the rollout of ADSL. Voice signals are sent on the basic copper pair network by analogue wave transmission for which our current telecoms system was designed in the Victorian era." The main advantage of DSL based 'always-on' will be the growth of the internet marketplace in the UK.g. as for a fixed price (in the future) of between £20-£50 per month UK internet users will be able to connect to the internet without worrying about their quarterly phone bill or indeed missed calls and therefore increase their overall average time on-line and hence increase significantly e-commerce based opportunities for UK business. Freeserve's Chief Executive (John Pluthero). modulation refers to the key method of putting data into a high frequency carrier signal for transmission and receipt on the twisted copper-pair wires.Lite ADSL standards. In some instances (e. can be set up from the telecom supplier's local exchange. This is an important feature of ADSL that will be discussed further in this chapter.e.g.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ ADSL is able to work in unison with existing telephony services due to the presence of a Digital Subscriber Line Access Multiplexer (DSLAM) at the telephone exchange that separate voice traffic to the Public Switched Telephone Network (PSTN). when a PC sends data via a standard modem.com/] The resultant high frequency signal makes possible the separating of some of that bandwidth to enable voice-band telephony to work in tandem with such digital data coding technology (see above). This latter process is considered to be a 'bandwidth bottleneck'. It has created the embryo of a good market and ADSL will undermine that. is because it is protecting its Highway [ISDN] business. BT has deliberately delayed the introduction of DSL technology. In the ADSL context. it is deliberate. with ADSL) a splitter is also required at the customer's premises to undertake a similar separation at the user end. "BT has dropped the price of Home Highway to make it attractive to the mass market and has promoted it actively." Gartner Group analyst Adam Daum has also commented on the loss of ISDN 'Home Highway' revenue. DSL services (such as ADSL) are ultimately expected to replace slower and older ISDN technology on both cost and speed grounds. digital data) that can then be interpreted on a PC. the supply of ISDN services has proved a lucrative market for BT and in the view of many industry commentators e. BT will also without doubt experience a reduced demand in its 2nd line market. indeed BT even claimed that this delay was due to a lack of demand for the service in its trials: "It's a disgrace. A Modem (modulator/demodulator) is a good example of a technology with which the reader will be familiar. This can be achieved by using a splitter at the home/business user end or if adhering to G. In the UK.

Meanwhile rural areas in the UK face an uncertain future with regard to access to (A)DSL based broadband services.theregister. Each connection on twisted pair lines requires both wires to be functional. hence for a set amount of money per month the customer can have unlimited access to the internet. Such lines (of which there are 600 million worldwide (Scientific American Oct.1.uk] In the US the number of DSL subscribers doubled in each quarter during 1999 and by the end of 2000 it is expected that over 2 million households in the US will have active DSL accounts and that every major US city will have DSLAMs installed at their telephone exchanges. such effects will be minimised. 2. BOX 3 The 'twisted pair' is the ordinary copper wire that connects home computer and indeed many business computers to the telephone company. It is also important to note that such lines are often unshielded and are of differing gauges. this investment in ADSL technology will cover 35 per cent of Britain's population. connections between these switching centres (exchanges) and consumers of telecom services are still dominated by the original twisted copper pair lines. [http://whatis. In a well specified and designed digital transmission system. Even this latter figure is a significant improvement than that of 56Kbps standard that modern day modems achieve. as has been outlined in ch. ADSL is one such digital technology – Asymmetric Digital Subscriber Line." [www. To reduce crosstalk or electromagnetic induction between pairs of wires. in some instances at up to 7Mbps. However. ADSL is a relatively new 'broadband' technology which enables existing copper pair lines to be utilised for the transmission and receipt of broadband telecom services. although 1-2Mbps being more typical. a 'narrowband' service. enabling 8. of Victorian origin.4KHz. . '99) were originally designed for voice-band signals in the frequency range 300Hz to 3. ADSL. is an 'always-on' technology (unlike ISDN and analogue modems). "Combined.co.2 ADSL: An Introduction In the US and Europe the backbone of the telecoms network is now comprised of mainly optical fibre cables connecting the numerous switching centres.5 million homes and businesses to join the broadband revolution.com] The information carrying capacity of such lines is ultimately limited and determined by sources of noise and interference. the two insulated copper wires are twisted around each other. in common with other DSL technologies outlined in Appendix 1.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ ADSL is currently nevertheless being rolled-out by BT to over 400 exchanges (Spring 2000) throughout the UK with plans for a further 100 in a second round of up-grades.

The Asymmetric element is related to the fact that the Downstream channel in the digital system is the primary channel to which most of the bandwidth in the system is devoted (i. due to reduced need (e. a device which forks the line into two branches. According to the ADSL Forum.e.6Kbps modems (which require quality lines with a high signal-to-noise-ratio) are already at the limits of capacity (35Kbps) of the twisted copper pair according to Shannon’s theorem* and although 56Kbps modems can extend this speed by utilising digital connections in the downstream direction in the communications network. allowing the ADSL system to coexist with the telephony system on the same pair…ADSL can be seen as a frequency division multiplexed system in which the available bandwidth of a single copper loop is divided into three parts…" [SAS: White Paper – ADSL] The three parts of the system referred to above consist of the existing voice-band telephony service. . the flow of information towards the consumer). ADSL modem technology then.e.ADSL OVERVIEW "By employing a passband modulation method an ADSL transceiver can operate at frequencies above those of standard telephony.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ [Source: Scientific American Oct. This would seem to be the limit for analogue modems. the Upstream channel and the Downstream channel.g. '99] BOX 4 . voice telephony and internet based services) and other transmission advantages related to cross-talk interference (refer to section 2. 33. one which goes to the telephone and the other to the customers DSL modem. via digital coding techniques giving potentially up to 99% more capacity for internet based data transfers without affecting one’s existing telephony services. 0-4kHz frequencies only being transmitted towards the telephone for termination.3).6Kbps in the upstream direction. Such splitters also act as ‘low-pass’ filters separating out the frequency signals that are above a current point i. they are still limited to 33. whilst the Upstream channel (from the consumer to the service) is normally allocated significantly less resources. transforms existing standard analogue telephony lines into high speed digital lines. The existing voice-band service is normally separated at the customers home or office by a splitter.

” [www.5Km from the exchange) more reliably and enable a reduction in overall costs and power consumption. Current developments in the ADSL field include the adopting of an industry-wide global standard for the technology. Furthermore. SDSL meets the requirements of these segments because symmetric bandwidths of up to 1. G. a key anticipated market for demand in broadband services in the islands in the next several years. “SDSL is the most popular with businesses and teleworkers. BT Home Highway) in the UK and although it can increase connection speeds to 128Kbps using two standard telephone lines (costing twice as much in calls) to provide a dual channel 64kbps x2 connection.5Mbps Downstream and 0. This would tend to significantly limit the availability of SDSL to home-based rural teleworkers in the Western Isles. G. In addition. It can thus be considered as a plug-and-play technology. although without doubt being to the detriment of some consumers who are already (or were expecting to).g.384kbps to 0. From the service provider’s perspective it is also desirable as a range of different speed services can be offered and charged accordingly.iec.5Mbps ADSL standard. G. .high-bandwidth telephony-based services such as multimedia gaming. higher speed standards will require shorter line lengths and thus either less customers or higher infrastructure costs.5Mbps mimics LAN connectivity.Lite. SDSL) being more applicable to LANs.Lite 1. named G. This standard if adopted will reduce the overall speed performance of ADSL (down to 1Mbps to 1.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ ISDN technology remains expensive (e.Lite addresses the problems related to getting the modem of one manufacturer to talk to a DSLAM of another manufacturer and this interoperability is also one of its key advantages. it remains slow even compared with the anticipated G.. Rate Adaptive DSL (RADSL) is another form of DSL that has gained increasing ground in the US. web-hosting services and remote working. thus saving on the requirement of engineer visits to customer premises. when there is only a short loop between the customer and his/her exchange.g. with more synchronous services (e. and video-on-demand (VoD) still demand full-rate ADSL” [EDN on-line Journal] ADSL is targeted at the mass domestic market for the most part. However: “.e. but make it more able to be delivered to a wider range of locations (6. On the other hand. benefit(ing) from higher speed ADSL services. The key constraint though with SDSL is its service reach of 3. This enables workers to send and receive large files from corporate servers with high speed in both directions. videoconferencing.Lite ADSL does not require a filter for digital data and analogue telephony.6Km – 7. Such technology is able to adapt its connection speed to that achievable on any given line and so operates at lower speeds over longer lines and higher speeds in instances where line conditions are more favourable i. known technically as a splitter.org/] This is an important difference and will determine the priority version of DSL that is appropriate to perceived needs in rural areas such as the Western Isles.Lite is thus viewed by many within the industry as being a sensible balance for the industry.5Mbps Upstream).0km.

The transmitted signal leaks into the receiver via capacitive and inductive coupling paths. as an increasing amount of lines reach their termination destination and as any interfering signals also attenuate." BOX 5 Information carrying capacity in digital systems is limited by the access channel itself and external sources of noise [SAS: White Paper – ADSL]: Near-end crosstalk – arises due to signals which interfere with the input of a collocated transceiver at the same end. Radio frequency interference Impulse noise – caused by a variety of sources producing short electrical transients. This is because as a signal sent from the exchange naturally attenuates over distance. . multiple insulated copper pairs are bundled together into a cable called a cable binder. In the opposite scenario. Far-end crosstalk – occurs when signals from transmitters on other pairs in the same cable leak into the input of the wrong transceiver at the other end. This cross coupling of electromagnetic energy is called crosstalk.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 2. it comes up against increasing sources of interference the closer it gets to the exchange due to the increasing number of lines and other signals it comes into close proximity to. the effects of cross-talk and line noise/interference would be significantly increased. In the telephone network. as a modulated signal also radiates energy onto adjacent copper wire loops which are located in the same cable bundle. It has been estimated (by Bellcore – a US phone company) that the typical consumer line in the US goes through 22 splices prior to reaching the customer.3 Cross-Talk Interference and resultant Digital Coding Techniques Asymmetric data paths such as those utilised ADSL are basically a compromise technology that increases bandwidth and extends the reach of digital line technology. Therefore if high-speed signals were attempted to be sent in both directions. Adjacent systems within a cable binder that transmit or receive information in the same range of frequencies can create significant crosstalk interference…The result is a slightly different shaped waveform than was originally transmitted. as a signal sent from the user to the exchange naturally attenuates. So what is cross-talk interference? It has been described in the DSL Sourcebook as follows: "The electrical energy transmitted across the copper wire line. as in many instances one's phone line will not come directly from the telephone exchange but will be spliced at least several times during the journey. it is more susceptible to cross-talk interference which gets less as one goes further away from the exchange. Crosstalk interference (refer to box 5) will be greater in cables nearer the exchange where many cables come together and hence a high speed digital signal sent from the end user to the exchange (Upstream channel) cannot achieve the same performance as one sent from the exchange (Downstream channel).

it creates 256 virtual modems operating simultaneously over the same line. [www. In essence. hence the adjective "carrier-less". one could argue that such specific coding techniques (assigning an additional but separate band to POTS based copper lines for upstream data and another for downstream data) were a prerequisite for success. they are expected to develop into 'rate adaptive' and symmetrical forms. namely Carrierless Amplitude and Phase (CAP) modulation and Discrete MutiTone (DMT) modulation are both (as mentioned earlier) passband modulation techniques which means that they can be designed to be used over any specified range of frequencies. and can be reconstructed at the receiver).Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Asynchronous DSL therefore has significant design advantage that is adapted towards maximum performance and service reach over existing copper local loops. FDM also has a further advantage in so far as it enables Downstream and Upstream channels to operate at differing frequencies (the lower frequency in the Upstream direction. for reasons already discussed) hence reducing 'near-end' interference because it transmits on a different frequency than any directly adjacent service receives. The carrier itself is suppressed before transmission (it contains no information.com] Obviously then. "The technique divides an overall bandwidth of about 1 MHz into 256 subchannels of about 4 kHz each. this being one of the key advantages of ADSL technology using standard twisted copper pair lines. for a technology designed (ADSL) to operate in tandem with POTS. thus reducing cross-talk. separating frequencies using what is termed Frequency Division Multiplexing (FDM). In essence. is one of the main modulation (digital coding) methods used to transmit and receive information on existing copper pairs to provide ADSL based services.8/33. the main technique used by DSL technology is referred to as multiplexing.e. the normal voice-band frequency range) is not affected by the other two. which are expected to go some way towards extending the current ADSL service. as data transfers in the Upstream and Downstream channels can be transmitted at frequencies above that of the voice frequency band. hence all three are compatible. The two main digital coding techniques used in ADSL. Carrierless Amplitude and Phase (CAP) modulation digital coding techniques use a single carrier channel and can be considered a variant of Quadrature Amplitude Modulation (QAM) that is used in V. which is then transmitted and separated out again at its destination. the process of amalgamating numerous signals into one. The third part of the system (i. '99] In contrast to this method.34 (28. CAP: " describes a version of QAM in which incoming data modulates a single carrier that is then transmitted down a telephone line. With regard to the future of such technologies. more complex signal version. Discrete Multitone Technology (DMT).6kbps) modems to optimise performance on standard twisted copper pairs. reach from its current 3-5Km ." [Scientific American Oct.adsl.

The current form of coding technique being rolled out in the UK to provide ADSL services is DMT. videoconferencing. as it only emits a low power level per modem card (between 1.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ A more symmetrical service (e. BOX 6 Demands on MVL DSL Source: www..5 watts) and it can be used in the same bundles as other services without any noticeable adverse effects and can even be delivered over non-twisted pairs. If one channel is experiencing noise due to say RF interference. all indicate a product of potential significant relevance to the Western Isles context. As a signal is passed down a line. web hosting)."[Andrew Muir. CAP does not have this flexibility.paradyne. This is a key issue for rural areas. In addition.4 ADSL Capacity Constraints The ultimate capacity of a line (excluding line quality factors) is also determined by its length.400Hz) are affected to . it will not be used in favour of the other sub-channels. as this ultimately determines bandwidth.g. This newer technology has no need for a POTS splitter and needs no configuration at the user-end.com The synchronous nature of MVL. it experiences attenuation the further it goes.g. Refer to Appendix 2 for further details. It provides 768Kbps connections and can be delivered out to 9Km and is called Multiple Virtual Line (MVL).etc A third and newer DSL technology that is synchronous in nature is also worth consideration. for both business and domestic usage.5 and 0.. DMT monitors the line conditions and works out the capacity of each sub-channel in the ADSL frequency band based on it's Signal to Noise Ratio. "During initialisation. its plug and play installation and length of reach. and the higher frequencies (such as those used by ADSL technology upwards of 3. Mason Communications] 2. SDSL as described earlier) will also be of increasing interest to larger SMEs who foresee a future which includes extended in-house web-based services (e.

particularly if engineers have to be despatched to both exchanges and customer premises in advance.. An ADSL signal can overcome electrical resistance of approximately 1500 ohms. Thicker wire is therefore better for longer distances and its occurrence will enable the radius of ADSL provision to be greater. Typically. Although such problems may be experienced at considerably less distances depending on the quality of the lines e.." [The DSL Sourcebook] The diameter of the copper wires in the loop also affects performance and an increased diameter will reduce attenuation effects as thicker wires carry more current further because they have less electrical resistance over a given length.4mm range. In the US the split in gauges is approximately 60% in the 0.5km in length . Apart from overly long local loops in rural areas which attenuate signals due to a loss of resistance on the thin copper pairs and cross-coupled (cross talk) interference issues. loading coils. the use of higher frequencies to support higher speed services also results in shorter loop reach. They have been traditionally used on local loops of more than 5.5 Line Quality Issues and ADSL provision The pre-testing of loops is a key requirement in the development of ADSL services and can be a costly process.5mm.5mm or greater range and 40% in the 0. With electrical signals transmitted over a copper wire line. differences in line gauge.5 at a distance of approximately 3. The average line gauge in the US is between 0.etc 2. one has to consider the presence of loading coils.g. at levels greater than this the signal attenuates significantly. there are several other main issues which affect the quality and availability of ADSL and other digital services on POTS. the more energy you burn over a given distance and the sooner you have to refuel. The distance from the exchange is thus going to be a severe limiting factor in providing broadband ADSL services to outlying rural areas. The main problem with regard to the above is that existing copper-based line systems were not designed for digital transmissions and so were provided using the thinnest copper-pair line that could support the voice-band demands of the day.5mm line. As stated in section 3.4mm gauge line can provide services only 2/3 of the distance of 0. The faster you go. Loading coils have been a universally utilised tool by telecoms companies throughout Europe and North America and are used to minimise noise interference on traditional voice-band services on long local loops.. 0. which are in effect a bottleneck in the supply of digital services over existing copper pairs. Current moves in the industry in North America are towards the automated testing of loops.5km to 4.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ "One might compare the transmission of an electric signal to driving a car. the presence of bridged taps. Obviously the thinner the wire the less copper used and less cost per metre of line provided. In the UK it is between…. Firstly. reducing both time and associated cost implications of developing a new service. This is because high frequency signals transmitted over metallic loops attenuate energy faster than the lower frequency signals.5km from the 'base station' delivery of ADSL becomes problematic for the above reasons.4 and 0.

with higher frequency digital services possessing a much smaller wavelength and rural areas tending to possess higher than average bridge tap lengths. Secondly.iec. "It has also been reported that load coils impair the operation of 56kbps and 33. In an ideal situation a telephone line goes from the exchange to the user directly i.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ They act as filters and cut-off sources of interference at frequency levels of above 4kHz. but all other digital services (e. in instances where there is old plant that has been up-graded over the years.4kHz and therefore such loading coils act as a severe limitation to the provision of not only ADSL.6kbps modems for similar reasons. some of the signals passing down such a line will continue along the old line and not be terminated (i. point-to-point.e. As a rule of thumb: "If the length of the tap is small.g. the reflected signal rejoins with a phase difference nearing 180 degrees and causes significant attenuation." [www. ISDN) as well. In summary. the reflected signal rejoins the original signal after a minimal phase shift and there is little attenuation of the original signal. However.e.org] However. perhaps by the introduction of new exchanges…etc some old loading coils that are no longer necessary can nevertheless still be present. modem. bridged taps are sections of line that are not on the direct path between a user's location and the exchange and which can consequently result in signal loss in digital systems via the reflection from the non-terminated pair of wires (refer to Box 7). A bridged tap occurs in a situation where a new service is provided to a customer at some point along an already existing pair that perhaps previously supplied a former customer. as well as when providing new services (adding some flexibility and cost savings to telecoms suppliers) and tend(ed) to have little effect on standard voice telephony services due to the long wavelength of voice band services in comparison to the length of such taps. has a significant effect on the reliability of digital services such as ADSL. digital service provision in rural areas will be very sensitive to such bridged taps. ADSL is supplied utilising frequencies at >3." (University of Saskatchewan) Such bridged taps also often occurred during repair work. when compared to the signal wavelength. but instead reflected back towards the original signal. as there in not a telephone. loaded lines tend to be straightforward to diagnose by measuring 'frequency response' with the appropriate testing instrument. the occurrence of 'bridged taps’ that are also referred to as non-terminated (open circuit) pairs. fax machine any longer at the old location). However. When the bridge tap length approaches one fourth of the signal wavelength. However. As a result. .

"The impact of electronic devices. '98]. a range of tests are undertaken to evaluate the necessary loops.variation in wire gauge adds to the challenge of determining a particular DSL system's performance over a particular loop.g. poor contact junctions. tip-to-ground and ring-to-ground parameters including DC voltage and resistance. A third possible problem with POTS is related to differing gauge sizes and the resultant different characteristic impedances present in a local loop: ". the presence of water in cables or cable jackets..standard tip-to-ring. along with AC voltage.g. resistance and capacitance") longitudinal balance..Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ BOX 7 A BRIDGED TAP New Location Working copper pair Telephone Exchange Non-terminated pair Bridged Tap Old Location e. It should also be noted that the performance attainable from ADSL can vary significantly depending on the presence of other digital services already been supplied in the consumer local loop (e. particularly T1/E1 leased lines). BT has just completed a . Other digital services can significantly degrade the ability of ADSL to perform effectively in a local loop. a phenomena more likely in the rural context. line mix-ups in a cable (split-pairs)." (DSL Sourcebook) Other line defects and weaknesses also need to be thoroughly assessed in advance of rolling out high frequency digital services on existing local loops. These assessments might include metallic tests (".5Mbps such bridged taps will not normally have a significant effect other than restricting the bandwidth and speed of the service able to be provided." [America's Network Dec. due to the varied geography of consumers. bridge taps and gauge changes are all evaluated. injections of electromagnetic noise and even seasonal temperature fluctuations in the copper. as interference increases significantly in loops where bundled lines are transmitting and receiving digital information at similar frequencies. old croft house In lower specification ADSL services up to 1. load coils. In North America when ADSL is planned for an area. unless of course the length of tap is extremely long.

after several recent discussions. continues to promote its leased line and ISDN (Home Highway) sectors (www. Prior to any unbundling of the local loop in the UK progress will depend on the commitment of BT to its rural customers.co.zdnet. Its sole indicators of an area's ADSL's readiness is instead based on its demand.g. According to BT's on-line information the provision of ADSL services at any given location in the UK: "… is subject to technical limitations and survey.6 ADSL Provision in the Western Isles Context The need for broadband telecoms links in the Western Isles based on such technology has already been outlined in chpt 1. it nevertheless appears that at the present at least. the so called low power. by using G. BT it seems. This latter view appears to be the shared by BT engineers locally. . The key questions for the Western Isles must thus revolve several key fields. high reach DSL alternative. it will only be in the more populous (and therefore profitable) areas. as we shall see in section 2. It may be that if progress is to be made in the rural context. even although the official BT position (see above quote) does not qualify such a view. new forms of the DSL technology are being piloted and demonstrated specifically due to their appropriateness to the rural market e." (Internet Magazine. Service availability in an area is constrained geographically and is subject to change. Certainly in the US.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 2. The consensus view appears in line with the following: "Even when DSL rollout actually begins. different DSL development models to that appropriate to urban areas will need to be investigated and progressed. unlike its rivals in the US. making ADSL as it stands at present in the UK a very much urban phenomenon.Lite ADSL.uk) and maintains that unmetered broadband access via ADSL will 'increase the load and stretch an already creaking network'." The full rollout of ADSL services to rural areas such as the Western Isles is as yet unannounced although is commonly thought within the industry to be a number of years distant to such non-profitable areas. MVL. May 2000).Lite ADSL and issues related to line quality assessed.8. the absence of SDH (and the non-availability of DSLAMs for UXD5b exchanges) is a potential constraint that is unlikely to be addressed within this current market ethos. in the absence of any USO by OFTEL and the long-term strategic thinking of the local and regional development agencies. It appears clear that even if rollout costs could be minimised and the number of customers passed maximised e. MVL being just one in addition to RADSL and G. BT does not consider such issues.g. However.

familiar with such exchanges have negated such worries. catering for low-demand rural areas in the first instance but having the flexibility to be scaled-up at some future date. but with the DSLAM scalable base units (for System X exchanges) required in this instance it would appear that such infrastructure appears to be less important than it was when trying to supply ISDN services to as wide a customer base as possible in the Highlands & Islands. the piloting of several already proven North American (A)DSL-based technologies (in the absence of any UK based technology solution) in rural areas such as the Western Isles may be considered appropriate to assess in practice the claims of their suppliers. 6 of which are BT's System X. . Of these. as there is no need to replace or up-grade existing exchange infrastructure. a key consideration may relate to their bandwidth connections to the Island's backbone. recent discussions with an ICT consultant in the area. which if limited may constrain the uptake of broadband services in many rural areas in the Western Isles. Such a solution is likely to be quite different than that currently being rolled-out in the UK's mass-market urban locations. However. However. as such pre-testing is a prerequisite to the development of such DSL based services. Lastly. It would appear unlikely that in the rural context where market demand is going to be initially low for broadband services (due to the low number of overall consumers and their reduced exposure to similar services) in the short to medium term. the System X are TXD03 Remote Concentrator Units (RCU) parented on a DCCE (Digital Cell Centre Exchange) and the UXD5B are TXD05 units. an appropriate scaleable DSLAM solution will also require investigation from various suppliers. Indeed BT has indicated that it is not likely to develop/install DSLAM capable of servicing the small type of exchanges such as the UXD5B present in the Western Isles. a cost effective automated line-testing method should be investigated to minimise any potential initial 'market-entry' costs. On the other hand. BT is unlikely to do the 'groundwork' on such local loops in advance. In rural areas there would appear to be only a marginal market for one or two telecoms suppliers and content providers. but instead just add to it. 1 older UXD5 and 1 L/Conc. 26 UXD5B. Their type and its appropriateness for (A)DSL provision is not yet clear. because this may just prime already marginal loops for low-entry-cost competition in July 2001. it must be recommended that in the Western Isles context if DSL becomes a priority. In addition. In the short term.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ With regard to the digital exchanges present in the Western Isles there are 35 in total (refer to Appendices 3 and 4 for location and background). in urban markets where there is significant demand it is worth BT's while bearing such costs to establish their service(s) in advance of the unbundling of the local loop (currently scheduled for July 2001) and any associated competition that that is likely to unleash. that BT will undertake such testing in advance of any local loop unbundling. as it appears upgrading the radio links of such exchanges is a low cost and straightforward procedure.

a UK based consultancy firm. at present. As yet. it is important to recognise that at present.7 (A)DSL and the Future There can be little doubt that (A)DSL is going to be one of the key broadband technologies of the ‘Information Age’ throughout the world and as such has an important position within the overall broadband sector. such rural market issues. until such a process has been instigated and completed one cannot rule out the use of the twisted copper-pair as being a potential supplier of broadband telecoms to businesses and consumers in the Highlands & Islands.000 worldwide to a staggering 45M within 5 years (by 2005). In such a context. to encourage an assessment and implementation of the types of solutions most appropriate to the rural context. it appears that there is potential scope for innovative technology solutions based on high speed DSL broadband solutions in rural areas such as the Western Isles. 10.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Obviously. although important to residents and businesses in the Highlands & Islands. during DSL rollout programmes. in the absence of any change to the USO (refer to chapter 1) in the interim that appears unlikely (until such services becomes considered mainstream elsewhere in the country) a clear path to the development of such broadband technology in rural areas does not exist. However.Lite and/or MVL would appear to be front runners in this respect. has recently predicted that DSL line installations will increase from 800. The development of such an innovative partnership venture will be discussed further in chapter 5. In this sense. In the absence of such an initiative it seems unlikely that any DSL-based solution for rural areas will be forthcoming for many years to come. . Even in the US. is thus strongly recommended with BT and any other potential market entrants. refer to Box 8. Indeed in instances where competition in the local loop is restricted as in the UK. Ovum. this depends on the willingness of a UK-wide private telecoms supplier with a responsibility to its shareholders and one which is in the process of coming under increasing competition in many of its former core markets. as any future rollout in 2001 is still going to be dependent on demand in the first instance. there have been numerous court cases by new market entrants experiencing a lack of co-operation and access to local loop and exchange facilities from the incumbent telecoms supplier. after unbundling in July 2001. Hence. the immediate need for the proactive solution suggested above to investigate cost-effective rural solutions. In summary then.5M of these being in Western Europe. rollout is being constrained by a lack of competition among existing telecoms suppliers leading to high prices and the protection of existing services such as ISDN and T1/E1 leased lines. one can relate this to the above scenario. ADSL G. will likely only be considered as a peripheral consideration for such a company. It remains to be seen how smoothly the transition to the competitive local loop will be in the UK. should DSL be a chosen priority for the Western Isles. this would depend on whether BT has tied itself into a supplier deal with particular manufacturers or not. although not necessarily ADSL. A partnership-agency approach based on an initial area of need. 2. Hence.

Such technology is without doubt going to shake up the existing telecoms sector as it exists in the UK today.04 0.05 0. for example.58 39. the additional provision of reportedly between 16 and 24 additional voice lines being deliverable over the existing copper pairs. but not the £150 installation charge. BT’s delayed and speed-restricted rollout of ADSL in the UK. According to many critics.08 0. but also have added usage charges. namely ‘Voice over DSL’ or VoDSL will without doubt impact on existing telecom supplier’s business accounts.17 28. what the Americans would call ‘truck-roll’. Most of the others do charge extra for a modem although their installation fee is less. (as mentioned earlier). for both the business and consumer market would appear to have an everincreasing future roll to play in both the so-called ‘new economy’ and the new broadband home-leisure market in the UK and abroad.99 13. Nevertheless. plug & play G. In marginal markets such as the rural areas of the UK such features will without doubt even more important. can be viewed as being protectionist towards the business-end and as a result has also been considered to be overpriced for the ‘mass’ consumer market in the UK. (A)DSL then. The key competitive factor being its ability to utilise existing communications infrastructure and increasingly on a global scale not require.04 0. VAT and no usage or ISP charges. In our rural locality there are still further issues to be considered. the newest variant of DSL currently being piloted in the US. One suspects that the majority of these lines are located in rural/suburban localities.Lite and MVL (A)DSL solutions. . In addition.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Box 8 Telecom Costs for ADSL Country US US Belgium France Germany UK Singapore Carrier Bell Atlantic US West Belgacom France Telecom Deutsche Telecom BT Sing Tel Magix Rental / Month (£) 26. or on-site set-up (to the rest of us) visits (each engineer visit has been estimated to cost between $100 and $200). Indeed plug & play installation is being one of the increasingly soughtafter features of DSL based solutions in the US for time and cost reasons. with obvious savings to SMEs and larger firms & industries as well. it is also worth noting that Bell Atlantic in North America has reportedly admitted that it may never be able to provide broadband DSL services over 40% of its existing lines due to technical and reach limitations.87 31.50 20. thus reducing installation bottlenecks and associated costs – e.g. by enabling.36 13.03 0.04 0.03 Information Source: Telecommunications On-Line It should be noted that the BT example does include a modem.44 Downstream Data Rate 640kbps 256kbps up to 1Mbps 500kbps 768kbps 512kbps 512kbps Cost per 1kbps supplied (£) 0.

Initially. This issue has therefore been indicated as being a key constraint on the introduction of DSL services outside of the Inverness area. faster and cheaper. . In short. this standard enabled the interconnectivity of high bandwidth networks across the world that is apparent today. By means of explanation. The 1980s saw the introduction of Synchronous Digital Hierarchy (SDH) systems making their first appearance. in for example the US and Europe. Plesiochronous Digital Hierarchy (PDH) was introduced in the 1960s and this can be described as 'almost synchronous'. PDH systems were often incompatible with each other and different systems from different manufacturers. incorporating automatic backup and repair mechanisms to address system faults as when they occur.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 2. PDH remains the most common. SDH transmission networks also have an advantage due to the compatibility achieved in setting up gateways between different network providers using compatible systems of transmission protocol.etc) as opposed to the PDH systems which used proprietary (and often incompatible) technology to enable high-bandwidth links. In terms of basic transmission systems installed worldwide. 'an often costly and complex requirement in the PDH system'. in so far as they needed less costly network interconnection technologies. not as efficient. As a result of this.g. in a digital telephone system. videoconferencing. These had the obvious advantage of being more efficient. The growing demand for high-bandwidth services has meant that there has been an increasing need for broadband networks across the globe and this in turn has increased the demand for more stages of multiplexing in digital signalling technology and integration of technology as convergence continues apace. PDH based transmission can be considered. in response to ever changing demands in traffic on the network (e. were complicated to interconnect with each other.. these being required in an ever changing telecoms sector where flexibility is key. as it requires more than one transmission frame to carry the 'bits' of information and suffer(s)ed from compatibility issues. SDH allows the provision of added-value revenue earning services for telecoms suppliers. In terms of equipment costs. whilst PDH requires 'very expensive equipment' at each and every exchange to multiplex and demultiplex high speed lines. the term 'synchronous' means that the 'bits' of information are carried from point to point in a single transmission frame. as SDH became an internationally recognised system of digital transmission (1990). SDH has no such requirement for multiplexing and demultiplexing at exchanges in the network. distance learning. The SDH standard has resulted in increasingly economic and highly adaptable networks. In so far. in recognition of early trends. in effect. SDH systems are also superior.. an investigation was undertaken to help understand the real issues. In terms of reliability.8 ADSL & PDH/SDH Issues During the research associated with this section and discussion with several parties it was brought to the writer's attention that SDH transmission was not available throughout the Highlands & Islands apart from in the Inverness area. video-on-demand.

The SDH standard in Europe and its equivalent in the US. Table 1 summarises the set of signals and relates them to the T-carrier and E-carrier systems.. is 24 DS0 (64 Kbps) signals transmitted using pulse-code modulation (PCM) and time-division multiplexing (TDM).312 Mbps. SONNET. used as the signal in the T-1 carrier. Belfast.312 Mbps 96 T-2 8. the signal in the T-3 carrier. the bandwidth normally used for one telephone voice channel. SDH has a number of advantages over PDH: ♦ ♦ ♦ ♦ ♦ Improves on previous 'DS-3' multiplexing standard Provide a non-proprietary solution Establish a hierarchy of digital standards compatible with European and US systems Give economic access to low volume traffic Supports more sophisticated services such as broadband ATM "SDH allows operators to build networks with the capacity and flexibility that are needed to transport the new services that users want…Operators want to be able to provide features from one end of their network to the other so that they can offer a wide range of revenue generating services. " . Digital Signal Designator DS0 DS1 DS1C DS2 DS3 DS4/NA DS4 Data Rate DS0 Multiple T-Carrier 64 Kbps 0 1.264 Mbps 2048 139..736 Mbps 672 T-3 139.736 Mbps.264 Mbps 2176 274. DS-2 is four DS1 signals multiplexed together to produce a rate of 6.544 Mbps 24 T-1 2. a transmission rate of 64 Kbps. Both the North American T-carrier system and the European E-carrier systems of transmission operate using the DS series as a base multiple. DS-3. The ITU guidelines differ somewhat.148 Mbps 4 E4 channels E-Carrier E1 E2 E3 E4 E5 .DS4) Digital signal X is a term for the series of standard digital transmission rates or levels based on DS0.176 Mbps 4032 565.152 Mbps 48 6.048 Mbps 32 3.368 Mbps 512 44. carries a multiple of 28 DS1 signals or 672 DS0s or 44. Digital signal X is based on the ANSI T1. enables the efficient translation of these differing carrier systems.Alcatel Box 9 Digital Signal X (DS0.. DS0 is the base for the digital signal X series. DS1. thus realising a vital competitive edge.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ According to Queens University. The digital signal is what is carried inside the carrier system.448 Mbps 128 34.107 guidelines. DS1.

a leased line for an SME in the US might be described as a T-1. 1998] . One or more AUs form an administrative unit group (AUG-n). How are PDH and ATM signals transported by SDH? Box 10 A special container (C-n) is provided for each PDH tributary signal. Finally. A virtual container (VC-n) is made up from the container thus formed. Wandel & Goltermann Communications For the technically minded. This is transmitted unchanged over a path through the network. Where synchronous tributaries are mapped. being the main differentials in the characteristics of the leased line. However it is also capable of transporting any PDH signal at <140Mbps.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In context. fixed fill bytes are inserted instead of justification bytes. This performance is achieved by a procedure termed 'mapping' which packs PDH signals into SDH transport modules. the AUG plus the section overhead (SOH) form the STM-n. [SDH Pocket Guide.5Mbps line. The unit formed by the pointer and the virtual container is called an administrative unit (AU-n) or a tributary unit (TU-n). These containers are always much larger than the payload to be transported. together with the path overhead (POH). STM-16 2488Mbps] "Synchronous networks must be able to transmit plesiochronous signals and at the same time be capable of handling future services such as ATM…Terminal multiplexers are used to combine plesiochronous and synchronous input signals into higher bit rate STM signals…Plesiochronous and lower bit rate synchronous signals can be extracted from or inserted into high speed SDH bit streams by means of ADMs*" [*Add/Drop Multiplexers] – SDH Pocket Guide. The remaining capacity is used partly for justification (stuffing) in order to equalise out timing inaccuracies in the PDH signals. Different terminology and different levels of multiplexing. Wandel & Goltermann Communications. these in turn are collected into a VC. 2Mbps leased line. [*STM-4 622Mbps. on the other hand in Europe. Several TUs taken together form a tributary unit group (TUG-n). a similar SME in Europe may purchase a leased line from its telecoms supplier (Kilostream/Megastream lines from BT) and receive a 64kbps or an E-1. 1. the process by which the above transmission of PDH and low bit rate signals are transported in 'containers' via SDH is described in Box 10. The next step of the formation of a complete STM n signal is the addition of a pointer indicating the start of the POH. STM-1* (Synchronous Transport Module) is a frame with a bit rate of 155Mbps and is the basic element of the SDH network. ADSL and other broadband technologies are forecast to impact on such traditionally expensive leased lines. With regard to SDH.

Although saying this. has allocated approx. THUS.www. that the writer has found no evidence to suggest PDH is an absolute constraint on ADSL services. or xDSL. PDH. a number of techniques exist for highquality routing over PDH networks. So although the PDH/SDH issue has not been a factor to date in the Highlands & Islands. after much background research on just such this topic. It should be noted however. with other customers being Iomart. Technically. because it offers better transmission quality. ATM cells are designed for high-performance multimedia networking e. It has also been indicated that the provision of On-Digital broadcast services will also require an SDH architecture. Dynamic Synchronous Transfer Mode (DTM) is the next generation bandwidth management technology designed to provide “everything over IP”. and indeed on this very topic there has been conflicting viewpoints. Similar to the packet switching used in data transmission (e. This is ultimately an upgrade problem for the incumbent. it is considered as being an advancement of 'packet switching'. integrated voice. InES and the Air Traffic Control service. frame relay. [*Jimmy Duncan.g. ATM itself is not a physical layer. video and data functions. TCP/IP). but instead particularly expensive to implement and increasingly tricky to manage as demand for new services increase. much stronger cases can be made given the present network condition and information gleaned to date. The characteristics of SDH. Unlike packet switching. ATM integrates multiplexing and switching functions. So. . Shetland & Dr Andrew Muir. hence providing possible further opportunities for investigation outside the scope of this report. "For broadband services typically based on ATM*. 40Mbps bandwidth to Lews Castle College. make it much more suitable for this application. in the absence evidence in the literature read.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In summary then.org/] *ATM (Asynchronous transfer mode) is a transport protocol technology. This is already available in the Western Isles and will thus provide an opportunity for further research. the replacement for SDH appears close to being approved after recent tests in Europe and the US. one could conclude that PDH as a transmission system is less optimal than SDH for broadband services but not necessarily prohibitive of such services. arguably. this in practice is largely negligible on the current communications system operating in the Highlands & Islands today. however. and support for facilities such as path self-healing" [WebPro Forum 08/08/00 . should DSL be the key recommended strategic broadband technology. have already provided an SDH network into the Western Isles as part of the UHI project and an 155Mbps STM-1 capable microwave radio link. enormous routing flexibility. and as a result is ideally suited to 'bursty' traffic in contrast to circuit switching. IT Consultant. As we shall consider later in this report there are other options for which. although PDH transmission is compatible with the main SDH transmission network via the mapping and packing of STM-1 signals and although there is some loss of speed.g. Mason Communications] The real issue for the Western Isles and many other parts of the Highlands is therefore the availability of SDH in the trunk route infrastructure according to the above-named consultants that are xDSL compliant.iec. The ATM layer runs always above the physical layer that can be anything like SDH. formerly Scottish Telecom. it needs to be recognised that PDH is not practically able to support newer digital services* such as ADSL which requires SDH infrastructure to enable its rollout. Given the above background theory it is difficult to pinpoint any network specific problem in the Highlands & Islands that cannot be potentially overcome with appropriate funds.

businessakademie. as well as ubiquitous access to those services. while the "multiplexer mountains" required are extremely expensive.com] . PDH lacks the flexibility of more modern networks in so far as it is by no means a straightforward process to provided new high speed services to customers. on a plesiochronous network this would require the 140Mbps channel to be demultiplexed down to its constituent 64 primary multiplexed signals to enable the 2Mbps channel to be identified and extracted and then the channels would need be remultiplexed back up again to reconstruct a 140Mbps signal.ittallaght. "Obviously this problem with the "drop and insert" of channels does not make for very flexible connection patterns or rapid provisioning of services. So where previously there might have been just a simple repeater between the two major service centres. and the new flexibility this brings. Thus.ie] and in practice this latter feature means that it is a much more straightforward task to allocate bandwidth on demand to customers requiring new digital broadband services. In terms of cost there are also significant saving also to be made. Although PDH equipment is still widely available it must only be a matter of time until it starts to become obsolete. (However. i.) "The more efficient "drop and insert" of channels offered by an SDH network. will lead to greater ease in provisioning of high bandwidth lines for new multimedia services. there is no master network clock. it may be that instead of upgrading ageing infrastructure." [engineering. together with its powerful network management capabilities.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ At the base level. the case for an SDH network in the present climate of change and increasing demand for dynamically allocated network capacity over a PDH network is clear and if the Highlands & Islands are to advance via terrestrial based broadband services then the case for such new investment is no less essential than it was in 1989 when HIE and BT invested over £20M in digitising the exchange network in the region.com] In summary then. making finding spares and replacements difficult as well as costly.rad. In view of the above then." [www. In practice. The most common example used on the Internet by several commentators both academic and commercial was that of one providing a theoretical client a 2Mbps leased line service halfway between two major services centres. "The PDH is based on asynchronous operation. The SDH is synchronous so it is possible to extract and insert individual channels." [www. This makes it expensive to ‘drop and insert channels’.e. If the unbundling of the local loop in July 2001 is to make any impact in the study region then a basic infrastructure capable of easily accommodating new broadband business and consumer services at a minimal cost to encourage competition can be considered essential. particularly in rural areas where the subscriber base is sub-optimal in the first place. there is now an expensive and complex mulitplexing/demultiplexing infrastructure to meet the needs of a single customer. there may be an opportunity for a fibre-based replacement programme. opens up the potential for the network operator to generate new revenues. the simplification of the network. this being an issue to be considered in the last chapter of this section.

Finally then. .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In the interest of stimulating competition in marginal telecoms markets for new services it has been suggested to the writer (in consultations undertaken to date) that this (PDH-SDH transition) might be an issue for OFTEL to consider and action upon. it is by no means a straightforward solution to build a broadband future upon in the Highlands & Islands in the present telecoms climate. combined with a low and scattered subscriber base of hugely noneconomic proportions for this particular technology. Nevertheless. as intimated on the previous page.g. this must surely be more likely from the wireless services of the near future and it is them we will go on to discuss in the next section. This may be an issue to be picked-up again in a future chapter. Yet with the arrival of DTM appearing imminent it may be more appropriate to by-pass SDH network transmission architecture and aim to ‘jump a generation’ and embrace the new IP-based DTM in line with a total re-evaluation of the Western Isles’ telecommunications infrastructure regarding its suitability for broadband. there may even be long term options (e. which will be expanded upon in a later section. to ensure the attainment of its goals related to local loop unbundling. although xDSL as a technology provides many potential benefits. as an overall solution providing ubiquitous access services. innovative partnerships) here as well. lack of competing telecoms providers and lack of present infrastructure. However. As a fixed line solution it may be initially considered more realistic than cable/fibre in the short term because of the geography of the area.

telecoms-mag.com Telecommunications On Line –http://www.233.DSL: What is it?.fastlane-mag.ttc. – Introduction to Copper Access Technologies – 1998 – www.com/ Ericsson .wwgsolutions.com/ EDN on-line Journal .xdsl.americasnetwork.'98 – www.internet-magazine.lite – Aug.www.com University of Saskatchewan – Communication Systems & Digital Systems: Bridged Taps and Bridge Lifters – 1998 .com + Numerous WWW resources www.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 2Wire Inc.netspeed.iec. '98 www.iec.com Scientific American Journal – High Speed Data Races Home – Oct.com Netspeed Inc.org/ International Engineering Consortium – DSLAM – 1999 – www.com/ International Engineering Consortium – ADSL – 1999 – www.com ADSL Forum – ADSL FAQs – June '99 – www.adsl.iec.org/ Internet Magazine – Getting started with DSL – May 2000 – www.com TTC – PDH Frequently Asked Questions – 1999 – www.sciam. '96 http://www.com Byte Magazine On-Line – Break the Bandwidth Barrier – Sept.com/ Telecommunications Magazine On-Line – Taps and Coils: The xDSL Challenge – Aug. '98 – www. the better – Dec. 1 – 1998 .paradyne.com …etc .byte.org/ International Engineering Consortium – DSL Testing – 1999 – www.12.com Paradyne Corporation – The DSL Sourcebook 2nd Edition – 1999 – http://www.http://www.com/ ZDNET – Enter DSL – 1998 – www.com/ – Rolling Along the DSL Trial – March 2000 TTC – Solving SDH/PDH Network Timing Problems – 1997 – www.com/ SAS: White Paper – ADSL – Feb.2000 .2wire.zdnet.Fast Lane Access Industry Magazine – 1998 .org/ International Engineering Consortium – Internet Access – 1999 – www.ednmag.com/ America's Network on-line Journal – Testing ADSL: The easier.telecoms-mag.sasi. 2000 www.iec. '99 www.http://128. .ADSL trims down with G.www.252/ Wandell & Goltermann – SDH Pocket Guide Vol.ttc.

even although services do already exist and existing copper and cable networks have struggled to deal with subscriber capacity at such an early stage in the UK's transition to a broadband 'Information Age'. according to the Scientific American online: "For up to one third of the population in the US and an even greater portion worldwide.2 degrees east. at a time when TV itself was in its infancy and when it was not even known whether radio signals could penetrate such a distance through the atmosphere. Broadband satellite receives only minor attention in its potential place as part of the 'broadband Britain' of the future. Certainly for rural areas and ideas related to social inclusion this is one particular technology that could address two of the main concerns raised throughout this report. Nevertheless. theorising their stationary appearance and noting that only three would be required to provide communications the length and breadth of the inhabited countries on earth. In 1964. A recent demonstration in Islay by BT also generated much interest in the area. as we shall see. as has the more recent High-Ways Ltd offering in Inverness that promises to provide an Internet via Satellite solution within the Highlands & Islands within the next several months. In Europe a similar service is already available via Europe Online providing both content and high speed internet access across Europe via the Astra satellite at 19. Microsoft in the US has recently (February 2000) announced an investment of $50M in partnership with Gilat Satellite Networks to provide the first consumer broadband satellite high-speed internet access service to its MSN subscriber service. satellite technology will not simply be a choice. it will be the choice. Indeed just last year several commercial providers begun to offer consumer services to the home both in Europe and North America. Arthur C Clarke then was the first person credited with the first technical explanation of how future geostationary communication satellites would evolve. are very much a first generation of internet-oversatellite services that are experiencing only low but steady growth and are not even considered by the industry as being a product/service with much growth potential. As far back as 1945 science fiction writer Arthur C Clarke in an article 'The Future of World Communications' described geostationary orbiting relay satellites on an equatorial plane. In this article he also forecast the broadcast of TV services via this medium. Syncom 3 was launched. .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Chapter 3 3 Wireless Broadband: Satellite An Overview of the Technology Wireless Broadband solutions are perhaps the most obvious form of delivery for rural areas in the Highlands & Islands currently on the market. Clarke also accurately discussed downlink frequencies. after being predicted by Clarke 19 years earlier. antenna receivers and theorised about 'photoelectric cells' to provide the required power. These services." Indeed. the first geostationary satellite. Questions still remain however on the reliability and standards of service available at present and as with many new technologies there have been 'teething problems'.

36. capacity and grade of service. Certainly. STM Wireless itself is rolling out three separate internet broadband satellite services for SMEs.and multicast services such as playing audio or video. Such a situation will therefore make any investment in. The very characteristics of rural areas transfer specific advantages to satellite based broadband solutions.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ However. distance learning. rural information infrastructure (RII). this latter service is of a similar nature to the DirecPC service in the US which still relies on terrestrial copper connections for the uplink. a model which even the industry recognises is never likely to generate anything more than 'niche' demand and is not a model being replicated in the new ka-band broadband services being developed. Indeed. The service footprint of these satellites is impressive.g. SOHO users and ISPs. yet such areas also suffer because USOs worldwide fail to incorporate broadband as a basic requirement. A majority of the Internet applications in the future will be streaming. Because they travel at the same speed as the Earth's rotation they appear stationary to the naked-eye. telemedicine and even web browsing. prohibitive. Rural areas tend to be scattered with often very low subscriber densities and as a result are not an attractive proposition to commercial communications operators..1 The Geostationary (GEO) Satellite There are two main variants of this technology that are worth further examination. broad. there are several key applications for which broadband satellite internet access can provide effective communications (refer to Appendix 5) these being mutlicast. corporate applications. which must include consideration of a "…balance between cost. They are unequalled for broadcast applications such as the delivery of the same information to a large group of users.] 3. All other broadband communication solutions for rural areas require not only require investment at the client end but also in the delivery infrastructure (e. each individual being . Firstly." the implementation of satellite-based subscription services would appear to be the most cost effective route to broadband internet access in rural areas. then from the providers point of view. So what exactly are the options for rural consumers who live further than 5km from their local exchange and are not served by a cable provider and are not able to attain 'line of site' delivery from alternative wireless services? Satellite has this unique niche in the market and furthermore appears increasingly in sync with developing broadband internet content. according to STM Wireless Inc. there are what is called Geostationary (GEO) satellites." [STM Wireless Inc. towers and base stations for the supply of microwave and cellular options) to and from the backbone (BT) network. Satellite options however are able to supply services to both rural and urban areas at a comparable price and this is the key advantage of this technology as the price of satellite broadband internet consumer services plummet as competition across the broadband sector intensifies. as discussed in chapter 1. This variant orbits the earth approx.. what the Americans would call. "Satellites have a certain unique advantage.000km above the equator and travels at the same speed as the earth's rotation.

"Bent pipe" satellites receive the data. making such a solution attractive to service providers. Box 11 Internet-over-Satellite To cover longer distances inter-linked systems can relay date prior to retransmission. In practice. However. The message is encoded into a radio wave and beamed to satellites overhead. They tend to have a lifespan of 10 years. between upload requests and download transfers of information. However. there remains one great challenge to geostationary satellite communications networks regarding their performance with internet based applications and content and this is the latency effect. The delay effect between two so called 'earth stations' or communication access hubs is put at up to 250+ milliseconds on each leg of the journey. for example. such communication satellites can be thought of as being distant signal repeaters in the sky.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ A total of just 3 satellites in this orbital plane can thus serve the vast majority of the Earth's surface. [Source: Scientific American] In-home cabling then carries the signal to a PC. At the same time such satellites tend to require larger and bulkier antenna and are thus more costly to manufacture and launch into orbit. then more of a problem is experienced with the time delay or latency experienced. These requests for information (communication signals). or time delay. An ISP sends a message to a satellite operator's ground station via a fibre-optic network. amplify the signal and send back to the ground. with several reference documents being contained in the . Refer to Box 11. A further discussion on the technical limitations real and perceived will be discussed later in this section. For large downloads and streaming audio and video casts this is not much of a problem. a service provider needs 8 satellites in orbit to provide a reliable service. A rooftop dish receives the signal and processes only data that is encoded with the correct IP address. There would appear to be a realistic prospect of such advances in radio signal transmission and processing leading to a much more usable service with only negligible delays in service requests. as increasingly advanced signal processing has developed. Return transmissions are beamed back in a similar manner. but for standard TCP/IP based internet browsing or on-line gaming which require a significant amount of 'handshaking' between the client PC and remote server. this has gone some way to counter the enormous distances involved and delays encountered. In effect. are sent to the satellite and then reflected back to the other station(s) and on to the client.

Such satellites also suffer from the effects of ‘atmospheric drag’ that acts to gradually degrade their orbit planes. [Networking in the 21st Century: The Sky's The Limit] . Joel Helpern. such a scenario could potentially lead to the TCP management issues outlined later in this chapter with particular reference to GEO clusters.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ GEO Latency: Box 12 GEO round-trip latency can approach the half-second mark-about 10 times the latency of a typical New York to California fibre hop. as they only remain visible for a period of 20 minutes before moving below the horizon. This is magnified in the journey TCP packets must make to and from satellites orbiting at about 22. director of internetworking architecture for Newbridge Networks. the pieces of a single transmission can be subjected to varied delays and subsequent packet reordering. LEO Jitter: Box 13 One of the great unknowns about LEO constellations is how well they will be able to handle variations in delay. However. In a low orbit satellite constellation any given transmission will be received and then transmitted on by several satellites.000 miles per hour) orbiting the earth in between 90-120 minutes. Obviously. The footprint of such satellites is obviously significantly smaller than GEOs and may be in the range of only 3000 to 4000km.500km per hour (17. They only tend to have a lifespan of 5 years." [Networking in the 21st Century: The Sky's The Limit] 3. This therefore limits the type of applications for which GEOs are suited. Due to their closeness to the earth they must travel very fast to defy gravitationalpull and travel at 27. otherwise known as variable latency or jitter. says: "voice cannot live with more than a quarter-second delay and prefers under 100 milliseconds. As a result any communications solution using such satellites requires a large number of satellite units in a range of inclined orbits. Round-trip delay already seen terrestrially as packets are sent. received and acknowledged. And because satellite orbits are typically maintained within a range of locations. A loworbit satellite may spend only tens of seconds over a certain geographical area. as this transfer of the information is not a foregone conclusion with 'jitter' entering the equation. which means a given transmission may be picked up and passed on by multiple satellites. it is not know for certain how well they will be able to handle 'jitter' (refer to Box 13). LEOs require 48+ satellites in orbit to enable the commencement of a reliable service Indeed.300 miles. requires sophisticated antennas and consequently adds to costs. with regard to LEO constellations. there are advantages with data transmission due to the shorter distances involved and resultant reduced delay in service requests (approaching that of fibre). rather than one precise location.2 Low-Earth Orbit (LEO) Satellites Low-earth orbit (LEO) satellites orbit the earth at distances normally between 5001500km. but to track and communicate with such fast moving objects. In addition. they need to be able to switch their work over to another satellite in the same or adjacent orbit.

the GEO network of satellite communications is the most sought after in terms of planned developments over the next several years and perhaps the main reason relates to cost and market uncertainty. Frequency Division Multiple Access (FDMA) Time Division Multiple Access (TDMA) Code Division Multiple Access (CDMA) FDMA divides the available spectrum among all users of the service by dedicating a particular portion of the spectrum to each user. There are two other factors of note with regard to orbiting satellites and this relates to their 'inclination' and 'eccentricity'. CDMA is sometimes referred to as 'spread spectrum'. MEOs literally occupy the middle ground.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 3.spotbeam. TDMA on the other hand. 10.000km above the earth. assigns each user a particular time frame with his/her data bits stored in a buffer and burst to the satellite using all of the 'transponder bandwidth' during a repetitive time slot. Ultimately though. Teledesic's (backed in part by Bill Gates) LEO plans for example are to cost in the region of $9bn. 2. the former being carefully calculated to maximised the level of coverage provided by multiple satellites and the latter designed to maximise availability over a particular region of the world. are 'in-sight' for 2-4 hours. FDMA can be used for either analogue or digital signals. CDMA offers the potential for a high capacity communications network.4 Frequency and Spectrum With regard to providing user access to such communication networks. which spreads the signals over the full bandwidth available. staying 'insight' for several hours.3 Medium Earth Orbit (MEO) Satellites Medium Earth Orbit (MEO) satellites lie somewhere between the previous two forms and orbit at height of approx. with all users effectively using the same spectrum. They go some way to both addressing the latency problems of the GEO clusters and 'jitter' problems of the LEO clusters. there are three primary methods: 1. 3." [www. . Finally. but tend to suffer from higher amounts of radiation from the 'Van Allen belt'.com] 3. At the receiving end 'autocorrelation' reformats the signals from all users simultaneously. CDMA modulates the signal to be transmitted via what is termed a 'pseudo random noise' (PRN) code. requiring 20 satellites. TDMA is normally digital in nature. "Typically the GSO environment may require initial investment (and therefore market exposure) of under $200 million whereas the LEO or MEO environment involves initial exposure well in excess of $1 billion.

Alternatively.2 GHz to 6. In this latter scenario the available spectrum is split into a series of 1. some of the existing suppliers of satellite communications such as the now defunct Iridium corporation used a combination of both FDMA and TDMA. A list of the main licensed satellite frequencies is listed in Box 14: BOX 14 SATELLITE COMMUNICATION SPECTRUM L-band = 350 MHz to 1.25MHz sub-bands.55 GHz to 5. particularly when looking forwards to future broadband services. This allows all users of the services to simultaneously utilise each sub-band via CDMA. others such as 'Globalstar' use an advanced combination of FDMA and CDMA.2 GHz .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In practice. Frequency is another key consideration when considering the effectiveness and appropriateness of satellite communications systems.2 GHz C-band = 4.55 GHz S-band = 1.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ K-band = 10.7 GHz to 33 GHz .7 GHz to 15.7 GHz Ka-band = 17.7 GHz to 36 GHz Ku-band = 10.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Q-band = 36 GHz to 46 GHz V-band = 46 GHz to 56 GHz W-band = 56 GHz to 100 GHz .

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The frequency of new services are chosen on the basis of performance and increasingly.2 hours per annum) lost communications.on-board processing and spot beams" . At high frequencies rain attenuation becomes a significant factor in the provision of reliable services.satellitetoday. 1. the method of modulation. An availability rate of 98%. This parameter depends on three characteristics: the bit error ratio (BER).5mm and this results in such signals (electromagnetic waves) becoming susceptible to the effects of scattering and absorption – attenuation of the signal results. It will "…not be possible to achieve the same availability at Ka-band and V-band as we are accustomed to achieving at C-band or even Ku-band. the range of values of a modulated parameter is continuous. and the method of coding…" [www. a further effect can occur as a result of rain at the 'earth terminal' and these can provoke a further degradation of the signal of a similar magnitude. approx. on the availability of spectrum. The advantage of digital transmission is that signals can be regenerated without any loss or distortion to the baseband information. The modulation may be either analogue or digital. AM and FM channels represent amplitude and frequency modulation respectively. In digital signals.com] Box 15 Analogue Vs Digital "A sinusoidal electromagnetic wave has three properties: amplitude. Combined. It may be that a particular set of choices will reflect a particular design philosophy or experience in some other field of communication e. for example. In analogue signals. As frequency increases. if falling within the working day. Teledesic and Craig McCaw. these effects did not initially inspire much confidence in the reliability of such broadband services in the study region.. This without doubt raises issues for areas such as the Western Isles of Scotland. which for many businesses in particular. Any one of these parameters can be modulated to convey information." [www. A fundamental parameter in digital communication is the ratio of bit energy to noise density Eb/N0. In terrestrial radio systems. In addition. frequency and phase. the modulated parameter takes on a finite number of discrete values to represent digital symbols. As far back as 1993 NASA demonstrated Ka band satellite communications success at penetrating through heavy rain clouds using its Advanced Communications Technology Satellite (ACTS). new broadband services may appear satisfactory but in actual fact translates to between 7.e. Many of the new broadband services in development and planning are proposing to use Ka-band and V-band frequencies. the wavelength of signals decrease near to the size of actual raindrops i. This 'powerful' satellite utilised: ".com] The ultimate design of satellite systems varies in almost every instance to be discussed and will inevitably result in a wide variety of alternatives and tradeoffs. due to the level of rainfall experienced annually. may prove unacceptable. The ground antenna can experience increased 'system noise temperature' because 'the antenna see warm rain at room temperature instead of the cold sky'.satellitetoday.3 days (175.g.

any telecommunications company looking for a universal global presence without having to rely of foreign or competitor's ground-based infrastructure to provide high speed communications bandwidth is investing in satellite solutions. if not now in the near future. Over the next 10 years it is estimated that over 500 dedicated broadband internet satellites will be operational in the Ka band.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ to enable effective communications under such climatic conditions. In an age where speed is becoming increasingly important to the consumer/client. To date. . These cannot be considered to be true broadband delivery systems and do still rely on user's terrestrial copper-wire connections for upload requests. These new more powerful Ka band satellites will allow high frequency narrow radio beams to be transmitted to ever smaller customer receiving dishes (although positioning will require to be increasingly more accurate). In terms of performance. Indeed. satellite networks can provide the highest throughput speed of all its competitors.4M antennas with 10W transmitters and ACT frame relay equipment. Fully operating Ka band systems will not be available to the broadband consumer until 2002. Box 16: Case Study SSI Micro is the largest ISP in the Northwest Territories in Canada and provides a frame relay satellite network. Their remote 'earth stations' use 2. "IP over satellite is not the issue. although the LEO antennas will need to be significantly more sophisticated to be able to track these fast flying satellites. In the global sense." In communities in areas such as Baffin Island more than 25% of the population are now on-line through such IP over satellite connections. The network provided uses shared outbound transmission and independent 'return paths' to the hub. approaching 15% of market share several years later. Obviously this does not apply to the first generation Europeonline DVB-based (Eurosky) and DirecPC hybrid satellite internet services present today. as mentioned earlier. then a competitive advantage is apparent. 7% of broadband business's bandwidth in the US will be supplied by the new breed of broadband satellite systems by 2005. It works…end of story. At each access site there are between 2 and 10 demodulators and these as a result make up what is known as a full mesh network capable of download speeds of up to 2Mbps. According to the Gartner Group Consultants. it is important to remember that apart from costly fibre-to-thehome. hybrid services using a mixture of technologies will prevail. SSI Micro has just invested in an extended network covering a much greater range in the Artic. Previously this was considered to be a significant constraint on such high frequency services. This newer network is designed around multiple transmit hubs which are in the C-band. and as a result be more costly. this demand remains for the most part unsatisfied. speed demands over the internet are widely quoted as doubling every year. Until then (and possibly longer outside the US). The issue is what kind of data service do you need for your application.

due to a shortage of spectrum available from Eutelsat's 13o East 'Hotbird' orbit. In the US. broadcasting from small transmitting terminals.org] Similarly. users of the Hughes Corporation's DirecPC (now available in Europe) have been reported as leaving the service due to bandwidth constraints. This underlines EUTELSAT's strategy of addressing the multimedia market and facilitating the development of innovative interactive digital applications.spotbeam. This use of multiple spot beams requires both the switching and on-board processing of data requests between the downlink and the uplink to make such high capacity data communications possible. In short there is a clear requirement for additional Ka-band spectrum in the next several years if broadband internet services in Europe and elsewhere are going to be realised. The recent bankruptcy however of the Iridium satellite phone network initiative which had a share price of $61 in 1998. has without doubt set back many of the planned constellations as investors have become nervous of the large amounts involved and the potential for disaster if their target market fails to materialise. for example. another key advantage of the Ka-band spectrum broadband satellite network is that because of the above-mentioned technology advances. falling to only $6 in July 1999.com] It appears that almost all current satellite service providers and indeed telecom suppliers are now planning new Ka-band spectrum satellites over the next 5 years. enabling full two-way services from antenna of a comparable size to those used today for Sky TV. The vast majority of the new generation systems (when launched) will also include some form of on-board processing and switching (in effect a network management system) to improve and enhance current broadband data transmissions." [www. Although. pushing its service date ahead of rival systems such as Teledesic LLC. .com]. as we shall see in the next section is without doubt in the lead in this area of telecoms activity.satellitenews. becomes possible for the first time. in the US. with a predicted order book of 1. When combined with SKYPLEX. This allows frequency re-use in much the same way as a cellular phone network re-uses spectrum. Such new satellite networks will also used 'pencil' spot beams: "The prime method of using the available spectrum efficiently is to use multiple "pencil" spot beams.eutelsat. such combinations are going to be used to provide the first functioning broadband services in an ever increasing competitive market: "The $1. each covering only a small area of the earth. A UK venture EasySat Internet Service was reported as being unable to expand in December 1999.6 billion CyberStar program will use both Ku-band and next-generation Ka-band satellites. The US.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In any case there is a shortage of spectrum available. Lockheed Martin’s Astrolink system." [www. in 2002 Eutelsat's next satellite (Hotbird #6) will be able to provide a combination of Ku and Ka-band spectrum: "The Ka-band payload will deliver fully interactive IP and DVB services to homes and small businesses equipped with transmit/receive antennas as small as 60 cm in diameter. users will be able to pay per usage. the Alcatel-led SkyBridge and Hughes Communications’ Spaceway project.300 worldwide during this time period." [www. Finally. or "micro-broadcasting".

According to DTT Consulting (www." From the European perspective however.5-30 GHz/18. Each Ka-band satellite will carry what is. it seems clear that the developing Ka-band LEO and maybe MEO networks will have a distinct advantage in terms of the delivery of high speed internet based services. such Ka-band advancements are not apparently being embraced in the revolutionary way they are across the Atlantic and the DTT Consulting report (1999-2000) concludes: "Europe remains way behind the United States in developing the appropriate satellite technology (on-board processing. 3.5 The Development of Satellite Broadband in Europe & North America In the European context. This being the case. there are 3/4 main players all with plans for Ka-band services scheduled for between 2000 and 2002. High speed internet access to the masses is without doubt the perceived starting point. then the implications for rural areas are of particular interest. such satellites will be able to offer all end users a wide variety of services from simple narrowband through to broadband applications. It is accepted even within the US industry that by 2002 there is little realistic chance of more than 3 or 4 of the main players surviving the competition to bring global broadband satellite internet services to the masses. unlike a normal telephone network.offering point to point circuits to both business and individual users at a cost far lower than available via satellite today…However. It is interesting to note that although no one 'killer' application is foreseen at present outside of providing 'convergent' interactive services. a form of telephone "switchboard-inthe-sky". This will allow the satellite to operate like a telephone network ." As we will see in the next section this has worrying implications given the extent of investment ($bns) and competition occurring in the US market where it seems inevitable that there will be a period of amalgamations and mergers in a bid to survive. antennas) and ground stations (phased array antennas) needed for the Ka-band environment. Finally. as access to continuing finance becomes an increasingly important criteria in advance of infrastructure completion and service revenues commencing. A typical GEO satellite will carry two transponders for one or two 'broad' frequency bands (29. although hybrid services which also use GEO satellites and the Kuband will be initially competitive. Soci‚t‚ Europ‚ene des Satellites (SES). This new high frequency spectrum is seen as the new convergence opportunity in the telecoms.3-18. computing and broadcasting industries.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ satellite service users had to lease permanent segments of bandwidth. the operator of the Astra satellite system will from this year (Astra satellite 1H) and next year (Astra satellite 1K) have satellites in orbit with the new generation of Ka-band transponders on board.8 GHz in .spotbeam. switching.com): "The Ka-band satellites offer fundamentally different services from conventional communications satellites. in terms of industry rollout. in effect. making such services costly for consumers and only really viable for large businesses and broadcasters transferring regular and large amounts of information.

Initially IP will be employed. BOX 17 • • • • SATELLITE TRANSPONDERS A typical transponder consists of various components that perform four basic functions: amplify the incoming broadband signal and filter out noise separate the channels contained within the broadband signal amplify each channel recombine the channels into one broadband signal for retransmission Source: http://www." Eutelsat.org/ "SES has for some time operated an Astra-NET service.. switching and redirecting amongst a large number of spot beams in most instances. These new satellite transponders will almost certainly allow new two-way interactive broadband services via satellite. These Ka-band transponders will also be complemented by Ku-band transponders to address developing capacity problems of the current digital broadcasting industry on the European continent. while the return path uses multiple-frequency TDMA." . North Africa and the Middle East. becomes possible for the first time. but the new service marks the introduction of genuine two-way interactivity via satellite…The new Astra Return Channel System (ARCS).eutelsat. Eutelsat has been reported as having plans to have as many as 23 Ka-band satellites in orbit in the future as demand for interactive broadband bandwidth increases.com/uplink.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ responding to signals automatically.” Source: www. These functions may include recovery of the original information on-board the satellite and processing of this information into a different carrier format for transmission to the ground. . this will combine regional GEO satellites with a global GEO/LEO constellation. In 2002 however this is due to be complemented by a sixth satellite (Hotbird 6) which will include 4 next generation Kaband transponders with on-board processing form Eutelsat's own Skyplex technology. broadcasting from small transmitting terminals. "The Ka-band service will deliver fully interactive IP and DVB services to homes and small businesses equipped with transmit/receive antennas as small as 60 cm in diameter.html "A typical on-board processing system will implement some or all of the functions that are performed by the ground-based transmitter and/or receiver in a transparent satellite system. as stated earlier perform new signal processing functions. set to become operational this year (2000). SES is now working towards a next generation system. This basic signal relay function at the core of such communications satellites is now to change as the new generation of broadband satellites will. or "micro-broadcasting". These new Ka-band transponders will have a Western European footprint. Any transponder that recreates the carrier in this way is usually referred to as a regenerative transponder.hughespace. similar to Eutelsat’s Easynet using a terrestrial return link. This underlines EUTELSAT's strategy of addressing the multimedia market and facilitating the development of innovative interactive digital applications. When combined with SKYPLEX.The 'Hotbird' network or constellation presently contains 5 GEO satellites which broadcast analogue and digital TV as well as radio and 'multimedia services' throughout Europe. but later ATM will be introduced to provide bandwidth on demand.. The system will use DVB/MPEG-2 for the forward path.

collaborative working. LAN-to-LAN interconnection. . Eastern Europe and Asia. The Uplink and Downlink are expected to operate in the 20-30GHz frequency band and customer bandwidths are expected to be offered at 144Kbps. and will eventually comprise five dedicated GEO satellites. The completed constellation is expected to provide services to a footprint covering Africa. EuroSkyWay will offer "bandwidth on demand" to service providers such as telecommunications operators. high-speed Internet connections.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Euroskyway. and even shopping will be possible via simple satellite terminals using small antennas. In addition to fixed applications. although being in many ways comparable. the first of which should be launched this year (2000) – The related services from this constellation are due to be rolled-out during 2001 in Western Europe. Matra Marconi envisions its GEOs as best suited for data broadcasting. teleworking. the small EuroSkyWay terminals can be installed in cars and aboard aircraft. Online services fall somewhere between the GEO and MEO offerings. 512Kbps and 2Mbps on new micro-antennas in the 0. TV broadcasters and Internet access providers who want to expand their infrastructure and reach new customers.7% availability for consumers and businesses alike.7M range. Many of the planned US systems are more ambitious in initial deployment. electronic com merce. The five key satellites will operate in the Ka-band and the transponders will incorporate next generation digital on-board processing. "With EuroSkyWay. although plans to upgrade service on an on-going basis in response to demand are articulated." As yet only limited information exists on the finalised nature of these developing European initiatives in the Ka-band frequency and the timescale for the introduction of consumer broadband two-way multimedia convergent services. and telemedicine. being extended worldwide by 2003.50. with the lack of recent press indicating some potential slippage in the timescales mentioned above. home shopping and its MEOs as best suited for distance learning. Antenna will be in the 0. as well as Western Europe. For example most use existing (tried & tested) GEO technology with added onboard processing for Ka-band services.5M range and support 99. Initial services however. Advanced bi-directional services to the home are to be provided offering a 2Mbps uplink and a 10Mbps downlink. "Matra Marconi sees WEST as a terrestrial alternative for serving areas lacking in terrestrial infrastructure as well as a way to quickly create corporate or other infrastructures.61. rather than more complex low latency LEO clusters. is backed by Alenia Aerospazio and two dozen partners. Time to market has resulted in many trade-offs in the technology employed. video conferencing with the office. Services are anticipated to be rolled out in the first instance in Europe in 2001. will not likely be the full satellite broadband product." Matra Marconi Space initiative called WEST (Wideband European Satellite Telecommunications) has unveiled proposals to invest $2bn in a new generation Ka-band constellation comprising of two GEO satellites and nine MEO satellites with near global coverage.

for example. The satellite cluster itself will include 8 GEO satellite with an anticipated uplink speed of 6Mbps and 108Mbps on the downlink: The system will employ innovative on-board digital processors. although this has since been reduced significantly. telecommuters. US cellular phone pioneer Craig MacCaw. Quoted data rates are given as up to 64 Mbps on the downlink and up to 2 Mbps on the uplink. large businesses. Its full operational capacity is scheduled for 2002 and it will operate in the high frequency Ka band.” Teledesic's plans include a 288 LEO-satellite system to operate in low earth orbit. small office / home office (SOHO) users and consumers will have access to two-way. will allow customers to communicate directly via satellite with other customers without having to go through a retransmission service or hub.hns.. Cost estimates (as mentioned earlier) are in the range of $9 billion. as well as broadcast capability throughout the service area.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ with the possible exception of the latter example above. This connectivity. distance learning. is backed by the Hughes Space and Communications Company Corporation (current backers of the DirecPC internet satellite service in the US and Europe) and has recently secured $1. packet switching and spot beam technology to offer point-to-point (or full-mesh) communications.4bn form parent company General Motors. interactive distance learning and Internet services operating at speeds faster and at costs less expensive than those provided by such current land-based systems as frame relay. with backing from Bill Gates (Microsoft). using the Ka-band frequency for both uplink and downlink segments as well as for its intersatellite links. on-board digital processing. one of the key advantages of the Teledesic product will be its ability to bypass local network bottlenecks in remote and rural areas where existing terrestrial suppliers have skimped on bandwidth availability due to investment considerations (i. security and reliability.com/news] . electronic commerce and videoconferencing are just a few of the new. it is claimed that their network will be the first truly global broadband internet service delivering both voice and data services able to fully serve rural areas and developing countries. "With Spaceway. bandwidth-dependent applications that are changing the way businesses and individuals interact. The satellite system will employ innovative.e. return to shareholders) related to the low user ratio and related revenue streams available in relation to the cost of upgrading the network “Telemedicine. Spaceway." [www. which plans new and innovative laser links for intersatellite communications. packet switching and spot beam technology to offer single-hop connectivity throughout the service area regardless of location. a Saudi prince and Boeing and Motorola. Initial plans incorporated an 840 strong network of LEO satellites. On the North American front there are also 3 or 4 main initiatives aimed at bring true multimedia broadband convergent services to the high speed internet market. Teledesic. Teledesic will facilitate these and other applications with high levels of quality. full broadcast capability throughout the service are.. Certainly. which will offer direct connectivity without routing through a hub. It also permits direct. high-data-rate applications such as desktop videoconferencing. The telecoms market has a place for this product according to Teledesic in a market worth $730 billion in 1998 growing to more than $2 trillion by 2010.

To achieve this connection over a gateway.469 km) with an inclination of 53°. Approximately 200 gateway stations are planned for worldwide coverage. This spot beam covers a fixed area on the earth. Each gateway will have a 234 miles radius (350 km) coverage. The 200 'Gateway' stations planned will interface with the existing terrestrial network through an ATM switch.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ SkyBridge LP is backed by Alcatel and its partners and shareholders are: Boeing. these spot beams will cover 92 percent of the world's telecommunications market. Sharp and Toshiba of Japan. Loral Space & Communication. Each satellite will also include 44 "spot beams. Litton and EMS Technologies of the United States. The Terrestrial Segment composed of gateway earth stations. Together. video and voice services that support business applications. It is composed of two main subsystems: 1. The low earth orbit utilised allows the minimal latency times – possibly as low as 30 milliseconds. Users . which is called a "gateway cell. "Seen from a user terminal. factories. Operating in the Ka-band frequency (20 GHz to 30 GHz). several satellites are always visible in the sky." with each one capable of delivering service to a large defined area on the surface of the earth. Each Astrolink satellite will also have up to 12 point-of-presence (POP) beams. this being required for the provision of real-time interactive services. ensuring seamless integration into these networks. each satellite will have a powerful telecom switch onboard with a capacity of more than 6 Gbps. SkyBridge will use a constellation of 80 satellites in a "bent-pipe" architecture in the lower Ku band. The Astrolink system will be able to provide: • data. Astrolink will initially begin service with 4 satellites and later expand as demand increases. THOMSON multimedia. and SkyBridge user antennae/terminals. SRIW of Belgium. hospitals or schools . which will be owned or leased by customers." Astrolink The Astrolink satellite cluster will consist of up to nine GEO satellites distributed among five separate orbital positions. Mitsubishi Electric. • interactive or two-way high-speed connections • point-to-point service. 2. The SkyBridge system is a LEO satellite network that provides end users access to high data rate multimedia services. Starsem of France and CIS. CNES and SNECMA of France. and depending on the geographic location of the terminal one or several satellites can be used to connect the terminal with the corresponding gateway. orbiting at an altitude of 913 miles (1. as well as multicasting service . companies. each satellite forms a spot beam. which provide large-scale interconnection with terrestrial facilities. which will be owned and operated by the Regional Service Providers. COM DEV of Canada.either business or private individuals.will be equipped with low cost terminals ($700 for a residential terminal). The Space Segment which is owned and operated by SkyBridge LP.

as with so much within this dynamically changing industry there are presently varying views on how successful the eventual services to be provided will be able to perform. For some applications (e. The billions being currently invested in such systems by some of the world's largest and most successful companies is testament to this belief. with the exception of Fibre-To-The-Home solutions and there can be little doubt that future demand for bandwidth will continue to grow at exponential rates and in this respect broadband satellite will be a true future competitor. the bandwidth of such networks will be unsurpassed within the broadband market. ATM's ability to guarantee quality-of-service levels has led to its widespread adoption by the telecommunications industry. the next generation of Ka-band broadband satellite services in both North America and Europe are advancing with investments of 10s of billions of dollars."multimedia satellites". Presently such new communication networks are on course to be available at the same time or in advance of the new 3G UMTS wireless solutions based around broadband radio 2Mbps communications which are due to become active in 2003. video or voice traffic. These modifications being specifically aimed in most instances at addressing high latency performance issues with TCP. It is clear however that several key modifications to the standard TCP protocol look likely as being adapted in advance of such services commencing. when they use it." In summary. "broadband switched" and "broadband interactive satellites". In addition. By paying only for the bandwidth they use. "ATM satellites". Again. interactive gaming). in view of the belief that next generation satellite services will secure 10-15% of the broadband market between now and 2010. For rural areas the provision of two-way interactive satellite broadband services that negate requirements for terrestrial 'local loop' infrastructure. Competition is anticipated to be fierce to entice the rural consumer/business not served by Cable or ADSL and this will undoubtedly ensure competitively priced subscriber services.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ "Using the asynchronous transfer mode (ATM) protocol.g. ATM makes it possible to bill customers for their actual network usage if they so desire. . Indeed looking to the future. TCP/IP Issues related to Geo Latency & Broadband Internet via Satellite There appears to be several problems inherent within TCP/IP networks which limit the performance of high latency broadband satellite applications and numerous research task forces and forums were set up during the last decade in advance of predicted internet based satellite networks. it would appear that irrespective of such modifications to the TCP standard. Astrolink customers will achieve significant cost savings. is anticipated to be a significant advancement. as are the terms used to describe such new technology . latency issues will not be overcome and for others (e. the Astrolink network will be able to accommodate multiple types of data.g.

On low latency. many of the large scale investors in the satellite broadband networks of the future are confident that by the rollout date predicted for such new services. In addition. In instances where data transfers are small or bursty on high bandwidth terrestrial networks or high latency satellite networks then it is clear that TCP will only on very rare occasions enable full bandwidth speed to be utilised. In general terms the main problem relates to TCP interpreting noise and latency on the satellite transmission network as congestion and as a result slowing data packet transmission in instances where it is not optimal to do so. If no further congestion (i. Obviously then if satellite networks with high bandwidth require large windows. Hence. once these problems have been overcome there is also much delay in increasing transmit rates back up to the optimal level. but these windows keep reducing due to noise and latency then network bandwidth efficiency will remain low. Furthermore. its adaptations to congestion work fast and effectively. congestion. the adaptation to change in the conditions in the network by TCP is limited itself by the round trip time in the system (i.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Nevertheless. in many instances ‘slow start’ will restrict optimal traffic flows on a WAN. re-transmitting data packets at a slower pace. the latency involved in sending a packet of data and receiving back its acknowledge). One of the main culprits within the TCP standard is an algorithm used to address congestion issues and this is called ‘slow start’.com] are the subject of an ongoing research effort that is outlined below. Any loss of packets results in the downsizing of the TCP ‘Congestion Window’ which results in less amounts of unacknowledged data being able to be handled in the network connection. This process slowly increases the TCP ‘Window’ size as data sent is received successfully and related acknowledgements received in return.e. This smaller TCP window then. The range of these issues and limitations “IP-oversatellite is subject to a number of adverse conditions that can have a detrimental impact on effective throughput rates and satellite network efficiency. This process continues until congestion is encountered whereupon the window size (usually initially about 512 bytes) decreases by 50%.mentat. low noise terrestrial fibre. Bit error rates. limits the bandwidth of the data stream and initiates the re- . not so on satellite based transmission networks. the majority of the technical issues will be addressed.e. coaxial and copper based networks for which the standard TCP was designed. Window size and buffer status can all have a serious impact on the overall IP-over-satellite performance curve. In addition. have been developing alternatives to TCP/IP such as its high performance Sky X Protocol. In opening a connection TCP tests the network for the optimal transmission speed available by sending an initially small amount of data through the network. companies such as Mentat Inc. packet loss) is experienced the process of window size adaptation upwards begins again to the maximum size.” [www. which when acknowledged generates the next burst which is 50% larger than the previous. queue management.

. and 2 seconds on a LAN. This monitoring of the network reduces packet loss significantly and as a result keeps in check the time consuming congestion adaptation processes in the standard version. This may enable a rapid initial gains in speed.54Mbps. particularly when related to short. Irrespective of this. hence helping to maintain overall system bandwidth. but more normally 32Kb. Similarly. Lastly. Yet: “To maximise bandwidth utilisation in a satellite network TCP needs a much larger window size…on a satellite link with a round trip of 0. standard TCP will timeout and all later data will also be discarded and re-transmitted through a smaller ‘window’ at a lower rate. Other variants of TCP such as T (Transaction)/TCP.iif. TCP-SACK has been another response to satellite latency and noise issues that are misinterpreted by standard TCP/IP networks as congestion. In the first 11 seconds only 20Mb was found to have been transferred via the GEO satellite link. there is also a method referred to as TCP Spoofing whereby premature acknowledgements are made by higher latency networks such as GEO satellite networks in advance of the real acknowledgement from the receiver and this deceives TCP into increasing window size via the ‘Slowstart’ algorithm by making in think it is operating over a very low latency network. 4 seconds on a LEO.hu/] A recent study has found that at SDH (OC-3) speeds of 155 Mbps it takes about 11 seconds to get up to speed on a GEO link with large windows.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Recent research has thus been aimed at increasing the initial size of the congestion window used by TCP and a new format of TCP called TCP-LW has become increasingly utilised to increase performance over satellite networks. as the round trip time decreases again the window size can be again increased in advance of the standard version protocols and algorithms. In higher bandwidth high latency networks. the theoretical optimal window size is 154Kb…” [www. TCP Vegas is a method by which the round trip time of data is monitored and as performance in the network reduces. a significant initial performance loss. Standard TCP operates with a maximum ‘Window’ size of 64Kb. a packet loss may be followed up by further successful data transmissions. ‘bursty’ type data traffic. as the timeout error will have been interpreted as congestion in the system.8 seconds and bandwidth of 1. a reduction in the congestion window is stimulated in advance. TCP-SACK (SACK= Selective Acknowledgement) however is more explicit in its approach and generation of acknowledgements and as a result enables the retransmission of the corrupt segment only via the network. which is designed to reduce the initial latency inherent to TCP by bypassing three-way handshaking conventions and TCP ‘Slowstart’ by using cached information from previous connections on the condition of the network.

” On the other hand. then an eventual timeout stimulates a retransmission of the missing data segment. says Barry Bertiger. Nevertheless. LEOs don’t efficiently utilise bandwidth because they have to regenerate the signal. In the air. will always run on the LEO portion of the network. Source: http ://telecomindustry. it should be noted that many providers on the other side of the Atlantic have already staked and continued to stake billions of dollars of next generation broadband satellite solutions that widely incorporate GEO constellations. with latencysensitive applications sent to LEOs and broadcast and multicast applications targeted to GEOs.7 An Summary of Existing Internet Via Satellite Services in the UK In the UK there are at least two Internet satellite services that are in effect just distributors and suppliers for larger EU-wide initiatives. “Those applications that will be Internet types of applications. high bandwidth networks and reduces web page loading times to a level comparable with terrestrial broadband connection networks. These new systems are also forecast to have reduced noise and use error correction systems.” The combination of the above enhancements to TCP/IP to address high latency and high noise broadband satellite communications has also been recently complemented by modifications to the HTTP standard called HTTP 1. the traffic will move from LEO to LEO or up to a GEO and back down again. since GEOs tend to limit the speed at which TCP/IP can be run. if it does not arrive at all. The traffic will be subsequently sorted at the NOC (network operations centre) using a specific algorithm for that purpose.com 3. Nevertheless. BOX 18 MOTOROLA'S APPROACH TO GEO LATENCY AND TCP/IP ISSUES Motorola…plans to provide dual-use terminals reportedly costing $750 on the low end that let the user choose whether a given application is to be sent to a LEO or GEO satellite. Motorola is planning a hybrid system. giving them further advantages over existing solutions.” he says.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ When the real acknowledgement is receive it is suppressed to avoid duplication.to better utilise the bandwidth provided by long-delay satellite environments. although some within the industry would contend that this already possible. Bertiger notes that when a business wants “one-to-many transmission for entertainment and instructional videos. or quasi real-time or real-time applications. GEO s will never be able to run at those rates.1 which is optimised for high latency.about. Such research and modifications are still maturing and in February 2000 the Internet Engineering Task Force’s TCP Over Satellite Working Group reported the next generation of TCP modifications to enhance TCP/IP traffic for satellite communication networks “.. whether the combination of such technology advancements can be achieved to a sufficient level to enable video conferencing applications remains to be seen. corporate vice president and general manager of Motorola’s Satellite Communications Group. “There. we can run at 155 Mbps.” He envisions a scenario in which an Internet user might order a video via LEO and have that order filled via GEO. where time of flight is equivalent to fibre delay. .

Existing call cost access to your existing ISP still apply e.g. and this provides high speed internet access via a proxy server service using one's existing ISP.. films. local call charges for being on-line. there is the 'Alternet' service for a subscription of £9.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ This service provides a quoted high speed internet DVB (Digital Video Broadcasting) based access service capability of "2 Megabits per second" and has set-up costs of £199 for a Telemann 200 PCI DVB/MPEG plug & play card.99 per month. The average browsing speed is quoted at 300kbps with videostream capabilities of 1Mbps. There are two services on offer now across the UK. A modem is required as per usual to logon and send requests for web sites that are then downloaded to one's PC via satellite. Firstly. sports news. This card connects to a satellite dish that costs in the region of £60-80. weather.. 10Mb of server space and FTP facilities. The 'Ultranet' service provides a direct dial-in service at up to 2Mbps providing up to 5 email addresses. as well as multicast services from Europeonline. of these multicasts to the PC would be financial news. . Upload speed is also obviously restricted to 56Kbps with the appropriate modem. These 'multicast' services do not require an internet connection to necessary be live and are made up. This service uses spare capacity on the Astra satellite. for example.etc An example of the 'broadband internet' experience can be seen from the following service pages: . Downloads of up to 2Mbps are also quoted. software and games distribution.

e.europeaninfopoint. This appears to be a service of significant potential for the Highlands & Islands. satellite will become the mass market alternative to ADSL and cable. This service uses the Eutelsat satellite network.000 users had subscribed to the service. According to Phil Sabin.e. the Alternet service was launched.000 of an anticipated 130. which although providing services and bandwidth to ISP and telecoms providers does not directly provide consumer services. A second service has also become available in the UK and is named DirecPC (http://www.I should imagine satellite will account for about a quarter of the mass market.htm) and mirrors a service already available across North America.co. DirecPC is a service supplied throughout .uk/DirecPC. a streaming video film." At its launch it was indicated that should sufficient numbers of users join up then free telephone costs for modem upload requests will be on offer. Eurosky's director. satellite is the only alternative…. Partly as a response to this. The system also has another advantage in so far as once an upload direction request for a service has been made i. the changing of one's ISP and e-mail address was negated. thus saving on on-line costs. It is predominately targeted at the business sector and enables speeds of between 400kbps to 3Mbps." he said (February 2000). which then meant that the one of the perceived constraints of sign-up i.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The Ultranet service was launched in October 1999 and by February only 7. "For people who do not live in an area served by DSL or cable. then the modem can be disconnected. "….

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________

For £399-00 + VAT and delivery, DirecPC will supply the appropriate satellite dish, PCI DVB card and software to enable the set up of the service. A subscription charge of £13.50 per month then entitles the user to 30Mb of bandwidth per month, with a further charge of £0.45 per additional Mb units used. A further range of services are also available for business customers for up to 1000Mb per month of bandwidth costing up to £320-00 per month in subscription charges and £0.32 for each additional Mb used over the 1000Mb limit in this instance. Finally, it is worth briefly considering the latest addition to the options currently on offer based in Inverness and only announced in May 2000 by Hi-Ways Ltd. A locally based service distributor within the Highlands & Islands is surely the optimal wireless solution for those resident in the area and one that could generate knock-on employment opportunities in the area. In effect this business is a reseller for Eurosky with the standard subscription costs as quoted above and a range of installation options and related costs ranging from £300 to £700 for the full package of equipment and installation along with data, free satellite TV access and 'Viaccess' Decryption. For the average home user without a satellite dish at present and looking for data and satellite multicast services the cost equates to £460 with self-installation. A further range of services direct to the TV is in development.

3.8

Summary & Analysis An explicit aim of the next generation of satellite networks, predominantly in the Ka band is to service currently under-served areas i.e. rural areas and areas where local loop conditions or geography mitigate against other terrestrial based broadband services. A 1015% share of the overall market is anticipated with new services being rolled out at a competitive rate to that of DSL, cable, (3G) wireless...etc. Certainly none of the other competing broadband systems have articulated their intention to specifically serve rural customers currently under-served by early roll-outs of broadband services. Apart from' fibre-to-the-home' or 'fibre-to-the-curb’ that may remain a 'pipedream' in rural areas in the medium term (unless some forward-thinking policy decisions are made), satellite promises the highest speed and greatest bandwidth of all its competitors (3040Mbps downlink and 1-8Mbps uplink). In the long run this must surely be another very positive aspect in its favour, given current exponential demands for bandwidth year on year, which one could anticipate well into the future. Indeed, one would have to suggest that any strategy on future broadband requirements must consider such a factor as being of significant importance. Consumer ADSL is largely limited to 512kbps in the UK and 2Mbps for businesses. Theoretical maximum throughput is estimated in the 8Mbps range given optimum line conditions and a location only a short distance from the local exchange. Consumer cable services in N. America are theoretically capable of 30Mbps throughput, but in practice customers’ bandwidth is limited by the teleco and by other users on the same cable loop. In any case cable is not a robust business solution for rural areas, as confirmed by a recent survey of small scale cable suppliers in the US by the NTIS

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________

The main competitor to such satellite broadband services in rural areas, which has actually been identified by the industry is the third generation mobile telecom suppliers providing UMTS (Universal Mobile Telecommunications Service) to consumers in all areas at up to 2Mbps, considerably faster than today's WAP internet phones which connect a 9.6kbps. Other line-of-sight radio and mircowave links are also an articulated potential competitor offering even higher bandwidth comparable with predicted consumer satellite services and it is the combination of these technologies that we will consider in the next chapter, some of which are available in a limited form now and others which will not mature until 2003+.

BOX 19 The by-passing of ageing terrestrial local loop infrastructure, as with those competitors mentioned above, must make the next generation of broadband satellite one of the key contenders to reduce the increasing urban-rural 'digital divide' mentioned in chapter 1. "Ka-band satellite systems will propel the IP-over-satellite market to $30billion by the year 2007." – Scott Clavenna, Senior Analyst, Pioneer Consulting, Cambridge, MA New services rolled-out in this year (2000) in North America, such as the Gilat-To-Home and a new DirecPC service negate many of the traditional problems associated with satellite services up until now, by also using satellite for the uplink as well as the downlink. Certainly up until very recently VSAT solutions (providing dedicated up and down bandwidth) for remote or mobile businesses were pricey, but with the type of recent development above, then satellite options become increasingly affordable and the new broadband services will ultimately phase out the expensive traditional VSAT market. Indeed it has been suggested that even in areas where terrestrial broadband services are on offer, price competitiveness with even this sector is anticipated in the longer term from broadband satellite solutions. “Affordable broadband satellite access to the internet is just around the corner. And not a minute too soon for people who live and work in remote and rural areas under served by land based service providers.” [www.about.com] It should also be noted that with experience to date, satellite customers tend to remain satellite customers once signed up and the new convergence of existing services with more interactive broadband multi-cast services will be an enticing prospect for many users

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ conferencing, web browsing, interactive gaming, teleworking/telecommuting, video-ondemand, interactive shopping and e-commerce, newscasts-on-demand and many other multimedia opportunities will be able to be provided to consumers and businesses alike on a truly global scale through one integrated convergent service – i.e. broadband via satellite. LEO, MEO and GEO satellites all have specific advantages i.e. GEOs providing multicast services to many users at once, whilst LEOs will enable more interactive services such as on-line gaming and perhaps MEOs being used for web browsing. As mentioned earlier many of the new constellations will include a mixture of orbits and hence will be able to provide the widest range of next generation convergence services to both customers and businesses alike in both urban and rural areas at equal cost. In short then, the key advantage of broadband satellite will not just be the high speed internet access and some other additional services, but a product that offers a full range of convergent media services within 5 years. Other wireless options simply do not promise such a package and others intend to offer similar services, but as yet require much technological development. On the other hand, the failure/bankruptcy of the Iridium satellite phone project last year (mentioned previously) combined with the recent rescue of the ICO Global Communications satellite network project from bankruptcy, by Craig McCaw of Teledeisc, has set back many of the US and indeed European planned broadband satellite networks, as investors became nervous.

Indeed, this year (2000) the Federal Aviation Administration in the US reduced its forecast of per annum commercial launches in the US from 51 to 41 between now and 2010 also stating that problems remaining with non-geo satellites have pushed back timescales. It may be then that service commencement of global broadband satellite systems will be nearer 24 months+ away, rather than the more widely anticipated 12-24 months earlier envisaged. It remains to be seen if initial European services can rollout on their anticipated timescale. Finally, one also has to consider Ka-band rain interference issues discussed earlier particularly when considering our study area, although one would have to speculate that the $bns of research and development funds have addressed this issue. Nevertheless, this remains a key unknown factor with this technology in a high precipitation climate, similar to the 'leafy tree' issues related to other line-of-sight wireless solutions. In summary, the vast sums of money being invested in the next generation satellite broadband market leads almost all analysts to agree the networks planned and anticipated will be developed, enabling the satellite market to become a main contender in the global broadband market. Views are mixed on the ability of the technology to deliver all the services anticipated e.g. high speed TCP/IP based internet access, videoconferencing, interactive gaming…etc – will jitter in the new LEO constellations affect latency to a significant degree or not? – will high latency GEO Ka-band constellations be able to be adapted for internet based TCP/IP communications? What is sure however, whatever the final mix of services and content provided by the remaining providers, we, in areas such as the Highlands & Islands of Scotland are part of their initial target market. One, where increasing competition in the broadband market as a whole will result in broadband services being delivered to rural areas which the consumer will be able to afford.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Given the above context, the writer is confident in articulating that there is likely to be a key future role for satellite broadband services in rural areas, this perhaps being a finding will that will surprise many. Particularly those with experience of the large antennae expensive existing VSAT services for business or those familiar with the first generation of internet-over-satellite services where numerous problems relating to bandwidth have been experienced and where the uplink relies on terrestrial lines via a modem. These are limited services separated by billions of dollars & euros of investment by the constellations currently being deployed with new on-board functions and abilities. The new generation will be much more than just signal repeaters in the sky. Indeed it is recommended that for assessment purposes, early entry into any trials being held by the new Ka-band interactive satellite service operators for which we will be in the European footprint will be extremely beneficial in assessing the area's eventual broadband future. Satellite has the bandwidth to be a future proof solution if it proves able to provide a reliable and cost effective service to rural areas such as ours. Indeed in convergence terms is also optimal. Such potential broadband services will most likely be those that pave the way for later competitors, aside from cable and ADSL which appear to be likely to remain urban phenomena at the time of writing.

Chapter 3 References:
Alcatel, Europe*Star System - www.alcatel.com Analysys, UK based telecoms information service -http://www.analysys.com/ Andrews Space & Technology, Space & Tech Digest, (2000) http://www.spaceandtech.com/
Brown Peter J., IP Over Satellite: A Global Solution Now (1998) www.satellitetoday.com

DTT Consulting, Internet Via Satellite 2000: Management Summary, (April 2000) http://www.spotbeam.com/index.htm DTT Consulting, Web Sites http://www.spotbeam.com/index.htm Covering Internet via Satellite, (July 2000)

European Space Agency, Broadband Communications by Satellite (1996) http://www.esa.int/esa/ Europeonline, Europeonline broadband internet satellite service homepage http://www.europeonline.com/gbr/index.htm Eurosky, UK based consumer broadband internet service - http://www.eurosky.net/ Eutelsat - Eutelsat in the Home – Internet via Satellite - http://www.eutelsat.org/ Eutelsat, Multimedia via Satellite Services in the DVB era (1998), http://www.eutelsat.org/

hu Intelsat.gilateurope. The Orbiting Internet: Fibre in the Sky (Nov. 1997) www.uk/satonthenet/white/bband. European consumer orientated satellite internet to the home service via HOT Telecom .com/ Hughes Research Labs.http://www. Dao.iif.faa.microcomsystems.high-ways.int/ Intersat.com/March1998 High-Ways.co.com/ MSN and Gilat. John.intersatcom.Business at the speed of thought .html Microcomsystems.intelsat. Satellite Communications in the Global Internet: Issues. http://ast.com/ Mentat Inc. IDG News Service. US Satellite http://www.direcpceu. 2000) Microsoft teams on satellite broadband: Software giant teams with Gilat to push high-speed Internet access via two-way satellite this year http://www. (Feb.com/html/mainmenu/_frms/index. (June 2000) http://www. The Art of Communication Via Satellite (1998) www. Pitfalls and Potential (1997) www. Christy .http://www. . Broadband Satellite. Laura.K.nwfusion.com/ High Speed Internet Trial for Consumers - Robert A Nelson.com/ Loral – TCP/IP Performance over Satellite Links (March 2000) .com/skyx/whitepaper.Sky X Technology Gateway White Paper (2000) http://www.byte.http://www.htm Hughes Communications. Networking in the 21st Century: The Sky's The Limit (1998) http://www.cyberstar. UK SME/SoHo orientated Internet Satellite service provider http://www.hot-tele.satellitetoday.com/High- Hot Telecommunications home page. Ryu and S. Satellite Networks Introduce First Consumer Two-Way Satellite High-Speed Internet Access (May 2000) http://www.html Satellite.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Federal Aviation Administration.html . Zhang.gilat2home.http://www. Y.direcpc. D De Lucia. Europe's leading provider of satellite services… http://www.techweb.co. US Internet Satellite service to the home -http://www.http://www.net/ Loral .com/ MSN and Gilat. (2000) http://www. B.mentat.com/ Hughes Communications.com/ Loral – Worldcast Case Study (March 2000) . The Global Internet Provider .http://www.Network Computing. (May 2000).html Montgomery.uk/DirecPC.cyberstar.htm Hughes Communications.cyberstar.gov/ Hudgins-Bonafield.com/news/2000/0218softsatellite. LEO Commercial Market Projections.europeaninfopoint.com Rohde. Internet Via Ways_Home/IVS/ivs. A 'wholesaler of satellite communications' .

40% of all e-commerce transactions between consumers and businesses will originate from wireless devices. Digital Satellite Systems for Internet Access (1997) http://fiddle. http://telecomindustry. Preeham P.HTML Scientific American Journal – Satellites: The Strategic High Ground – (Oct.satnews.1 Multichannel Multipoint Distribution Services (MMDS) Firstly.com/GLOSSARY. we need to consider radio-frequency technology.www.com/industry/telecomindustry/ Teledisc.com/ Surrey University. broadband Internet-in-the-SkyTM network .ee.about.edu/ Via On-Line. which holds much promise for the future.Wood/constellations/index. outside North America.www.satellitetoday. A.com/viaonline/survey/#article5 Chapter 4 4 Wireless Broadband: Line-of-site Solutions / UMTS An Overview of the Technology and Market In the developing world of wireless broadband solutions. http://www. and White J. not only for broadband mobile telecoms.surrey.www.ee.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Satnews Magazine.vt. In terms of definition it is important that we first clearly define the competing technologies as they exist at present.edu/ Technology Feature.. Satellite Communications General Information / Publications.Stratospheric Telecommunications Service. The Gartner Group in the US have recently estimated that by 2004.. Two Way Satellite Delivered Internet. There are three basic competing/complementary technologies referred to in the literature reviewed (MMDS Unlicensed and LMDS) and a fourth.sciam.umd. 3G mobile.com/ STM Wireless Inc. mostly in the .com/ Skystation International's .skystation. A global.ac.isr.. '99) www. the main competitor for broadband satellite in 'non-commercial' regions is that originating from radio/microwave (radio waves with a frequency >1GHz) based telecoms technology and the soon to be introduced 3G UMTS.html Syed. General website on everything to do with satellites from PhD student at Surrey University -http://www. (March 2000) http://www.com University of Maryland.uk/Personal/L.com/industry/telecomindustry/ Technology Feature. 4. It has recently been adapted to enable two-way (synchronous) internet connections. but also for wider broadband wireless solutions for both home user and business (mobile) user alike. known as Multichannel Multipoint Distribution Services (MMDS) which is an already existing technology that has been used to provide analogue TV programming during the past several decades.stmi.teledisc. Glossary of Satellite Terms . Internet Fuels Satellite Growth (July 2000) http://telecomindustry. Satellite Internet Survey.about. Satellites role in Broadband Internet Access (1999) http://www.

com/] (refer to diagram on left) offers synchronous 10Mb/s internet connections to both homes and businesses within a 50km radius. much more confidence has also been placed in radio as a broadband access technology. MCI and Sprint spent close to $2 billion in 1999 buying up MMDS spectrum licenses in the US. and permits operators to greatly increase the amount of data that can be sent across a particular amount of spectrum. In recent years. potentially enabling a fast-track route to rural broadband service provision. It incorporates a 'low cost' transmission tower at the supplier end and a 13. MMDS frequencies became sought after commodities in targeting the demand for internet broadband bandwidth along with digital TV direct to the growing home market. in a recent article in PC Magazine on-line. Arizona the Sprint Broadband Direct service [http://www. It involves .5" x 13. broadband data and video services to the masses. Indeed the company has specifically mentioned its ability to bypass the existing 'duopoly's' last mile infrastructure in its region and enter the broadband user market at a much reduced entry cost. MMDS channels have been traditionally transmitted from both omni-directional and directional antenna to provide extensive line of sight in all directions. Sprint and MCI WorldCom are two examples of fixed wireless operators in the US implementing this 'last-mile' bypassing technology." [http://www.com/] MMDS is already a commercial reality in the broadband market in the US. MMDS has also been recognised for its simplicity and low cost rollout. as technical limitations have increasingly been overcome: "…digital technology has greatly improved the signal quality of broadband wireless systems. irrespective of the condition of the existing local loop infrastructure.5" digital transceiver and wireless broadband modem at the user end. given its 'last-mile' bypassing ability. Indeed in the US during 1999. Sprint has recently announced a deal with Lucent 's ORiNOCO wireless networking system for use in the home and small business interface -environment. For example in Phoenix. This type of product would without doubt have much relevance to the Western Isles and Highlands & Islands context.insight-corp.sprintbroadband.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ This technology is being held in some areas of activity as being the key enabler of the mix of services related to audio. On the other hand. This is a product which will be considered in a latter section. LMDS spectrum based systems have largely targeted the urban business market in the US with specific line of sight requirements and a reach of only 4 to 5km. particularly with the success of cellular telephony.

It also has an approximate quoted range for service delivery of 45-50km and is therefore a very interesting technology for the rural context. quoted as being the world's largest spectrum holder.html .000 users (assuming the frequencies are available).Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ small receiving antenna at the customer end. has been investing in rural Venezuelan state of Merida in a government supported partnership scheme in the 2. this service consists of a PRIZM base station with a proprietary narrow-beam. Spike Technologies installed their wireless local loop solution in this region – see box 20.spiketechnologies.com/index2.5Ghz spectrum at the above quoted distances with a reported synchronous connectivity of 10Mb/s in both directions. the US company WinStar Communications Inc.800 square miles and can be configured to give each user a 10 Mbps upstream and downstream connection while handling a potential of up to 33.A Broadband Wireless Solution Spike's core product and technology is called the PRIZM Broadband Delivery Service (BDS). Essentially. A single base station can cover up to 2. http://www. Box 20 . For example. compactsectored antenna that communicates with wireless subscriber units that are in line of sight contact with the base station antenna. In terms of hardware. plus wireless modem.

cableaml.com/50Kmyth. although is still a worthy technology nevertheless." [http://www. it is not economically feasible to make changes due to the disruption and cost of re-orienting the antennas for thousands of subscribers.html The illustration above highlights the service 'shadow' cast by a tall building or natural feature of topography which affect the transmitter's LOS efficiency. .1-2. MMDS has not lived up to its quoted potential. Each 'Rural Cell' uses one 'base station' with a quoted service-reach radius of 8 to 48 kilometres. It is essential that any 'shadow' areas do not incorporate any of the initial main commercial service concentrations.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Such examples of MMDS technology potentially enable the realisation of a vast range of broadband services in rural areas. Spike Technologies specifically refer to their technology's ability to address and overcome the issue of 'digital haves and have nots in the new information society in both rural areas with a low population density and urban areas with older telecoms infrastructure or that outwith the range of Cable/DSL services. "Experience has demonstrated. potential service connection is by no means guaranteed. their 'Rural-PoP' product offers a cut-down and scalable version of their standard 'Super-Cell' architecture.cableaml. It does need to be taken into account that in any area within a given 50km radius of the high power MMDS transmitter. with supporting infrastructure already in place e. However.7 GHz frequencies. Both geographical obstruction ' service shadows' and building shadows combined with the natural curvature of the earth have meant that often in practice a reliable service radius of nearer 20-30km is achievable.com/50Kmyth. Thus a single basic array implementation of MMDS is likely to yield a lower return than perhaps initially anticipated by service providers. in terms of practical implementation in the real world.1-3. In an ideal situation the terrain needs to be both flat and gently sloping up towards the transmitter which will be located on a hilltop. Once an MMDS design is implemented.html] Box 21 MMDS 'Shadow' Source: http://www. it is practically impossible to achieve a reasonable percentage of LOS homes beyond a 30 kilometre-radius service area (in many cases 20 kilometres). the Eitshal transmitter location in Achmore in Lewis? – however this may not be an electromagnetically 'quiet' area – often another prerequisite with digital wireless .g. unless the transmitter is located in a site meeting most of the ideal conditions. The Spike HighPoint TM family enables high speed local loop connectivity to the internet in both the MMDS 2.7 GHz and 3. For example. Indeed.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ It is clear then that to maximise MMDS performance not only does a thorough geographical survey require to be undertaken but also a wide ranging market survey. 4. although the risk here is that some of the periphery areas of the 'shadow' area may incur interference from the residue of the main service-signal resulting in distortion and overall signal degradation. with the minimisation of 'shadow' non-customers being the key and in this sense the 'small cell' approach is often the most viable solution for the potential service provider (refer to Box 22). Initial planning is therefore of the utmost importance. "Broadband MMDS transmitters and repeaters make it possible to implement a "cellular" or "distributed power" approach. Such cellular topology allows operators to accomplish several important goals: The elimination of the outrageously large and expensive towers and infrastructure required by most centralised transmitter systems. atop the War Memorial in the Stornoway area may provide such a site in our local area. The reduction in number and size of shadowed areas with significant improvements in LOS coverage increasing the revenues per square kilometre of coverage. . to enable initial coverage to at least target the largest commercial markets in its rollout – e.g. Areas in the 'shadow' of the service (refer to Box 21) can carefully be incorporated by low power signal repeaters.2 MMDS: Implementation & Requirements The lesson quoted from the '50Km Myth' authors is that a well designed small service cell may in fact prove to be more financially viable than a blanket coverage option on a larger scale.

g.html] BOX 22 MMDS System Broadband MMDS Repeater Broadband MMDS Repeater MMDS Signal MMDS Signal Fibre or Microwave link Base Station Broadband MMDS Transmitter & System 'Headend' MMDS Signal Broadband MMDS Transmitter Broadband MMDS Repeater Radius of service areas: Typically 10-30 kms An effective multi-cell architecture with a limited number of broadband transmitters and supporting high-powered (e.cableaml.com/50Kmyth. "With systems available now up . making it possible to concentrate first in the most profitable markets for a faster return on investment and a more manageable impact on cash flow. 'linearized on-frequency') repeaters is one suggested design that potentially is able to service initially key areas and latterly (depending on the quality of initial planning). 'Linearization techniques' have been suggested* as being able to increase the power output to be utilised in repeaters (and transmitters) to increase their service range efficiency and this in turn enables the network infrastructure costs to be minimised." [http://www.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ A significant rationalisation in the operator's initial investment: an MMDS operator can implement a system design in consecutive phases. with the introduction of repeaters. other 'shadow' areas.

" [http://www.cableaml. The pace of development in the wireless broadband sector is growing at a exponential rate and new more efficient equipment is coming to market each quarter with increasingly more sophisticated functions and user orientated interfaces. for rural areas with a low populations density. such as much of the Western Isles.html] However. giving a quoted 30Mbps downstream and 2.The Headend and Base Station. but is more costly to rollout. . multi-cell architecture provides higher capacity and higher coverage benefits. BOX 23 : Outline Architecture of MMDS Broadband System Source: http://www. are designed to operate within the standard MMDS 'channelisation scheme'. The architecture of this solution is outlined in Box 23. are shown above.cableaml. the large cell architecture may have benefits. Other architectures on the market such as Cable AML's 'BWA-2000' range. In this instance the available bandwidth is divided into 31 channels of 6MHz of spectrum. the Transceiver & Repeater elements and the Customer Premises Equipment (CPE).html The several key elements of the MMDS system of which some may be physically separate or part of the same array . it is possible to capitalise on the advantages of a distributed MMDS topology at a fraction of the cost of a centralised architecture using channelized transmitters.com/50Kmyth.com/bwa2000.56Mbps upstream. although obviously the small. being the most cost effective situation. The NextNet plug-and-play CPE shown in the photo below is typical of such developments.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ to 2 kilowatts in linear-equivalent power output.

gov.http://www. then there would appear to be some potential here worth further investigation with reach. However.4 GHz frequency band" by the Radiocommunications Agency investigated quality of service issues involving operations in this band and these will be further discussed in a later section. being quoted in the 30km range. Such flexibility will also be of direct interest to the home of the future where internet access will be a family affair and multiple connection nodes within the home will be a distinct advantage.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ "NextNet's unique customer premise equipment integrates the data transceiver and antenna into a single compact unit that is completely customer-installable" .nextnetworks. A recent report in the UK: "Compatibility between Radiocommunication & ISM systems in the 2. it has also been indicated that that spectrum formerly employed by Ionica in the 3. it is not yet clear whether such spectrum is to be offered on a national or regional basis. In short.radio.4GHz in particular and certainly in the US. It is also interesting to note that BT has had an allocation in the 2GHz spectrum for some years for "serving primarily remote areas of the UK with FWA services" [www. single or multiple user access through a single subscriber connection. In the UK. But. There are however other options in the unlicensed bands at 2. in rural areas. Scientific & Medical) restrictions of this band. The focus in the higher band frequency spectrum is understandable given developments in LMDS elsewhere. currently providing 'wideband' FHSS (up to 2Mbps) wireless telephony/internet access . the situation is not so clear as the recent focus of license auctions has been in the 3G frequency of spectrum. but have decided not to implement any pilot rollout projects. due to its similar reach restrictions to that of ADSL.4GHz band.html The unit above allows SOHO users. via an Ethernet connection.uk]. Atlantic Telecom is one of the few operators with experience in the 2. Most recently during September / October 2000 recent license activities have been focused in the LMDS band at 28GHz. in the absence of such interference.com/products_prod_bottom.4GHz band is also likely to be up for auction before the end of 2000. There can be little doubt that MMDS technology is maturing to the point where it is going to become a significant component of the US broadband market. however this spectrum is likely to be focused in the mass market urban locations. with a latter auction specified in the higher frequency 40GHz band. where interference is likely to be significantly less than that from urban areas. where a number of manufacturers have developed broadband wireless technology in line with the ISM (Industrial. This spectrum may be reallocated in the near future.

but also modulation and demodulation functions and the 'network interface for fibre termination'.gov/lmds. Clearly. the next six months may change this situation significantly and in any case some alternative potential based on similar technology does exist in the unlicensed bands.com] The service coverage of a single cell LMDS network is quoted as being within 5-8km from the base station in direct line of sight. The advantage of this latter element means that service subscribers can communicate with each other without actually entering the fibre network at all. the provision of MMDS wireless architectures are of significant relevance to this study. This has potential advantages (i. A typical downstream data rate for LMDS is 38Mbps and this can be configured to be symmetrical in design. as the public grows increasingly intolerant of such structures and their unknown long term effects on human health. However.e. This is an area that will be further considered in section 6.nist. A 'base station' in such a network (refer to Box 24) will normally comprise several key components including obviously the microwave transmission and reception equipment.1GHz – 3. whilst also in some instances including a local switching element. at the same time. the Customer Premises Equipment (CPE) (refer to Box 25) adds up to a quoted investment of anywhere between £85-£450 per household [http://nwest.wcai. LMDS supports both ATM and IP transport methodologies within its network interface.3 Local Multipoint Distribution Services (LMDS) "LMDS is a broadband wireless point-to-multipoint communication system operating above 20Ghz (depending on the country of licensing) that can be used to provide digital two-way voice. the key elements required to build a broadband internet access network around. 4. .html]. with a total cost of nearer £700 per subscriber.4GHz band which has been quoted as being a key determinant in access provision." [www. Internet and video services.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ quoted as being due to the power level limits in the ISM 2. data. cost savings) for both subscriber and service provider alike.7GHz spectrum. spectrum availability is of key importance in the overall equation and recent focus in the UK has not prioritised the longer reach broadband 2.4. Nevertheless. The service itself incorporates a broadcast like down channel: point to multipoint. with the up channel (from the service subscriber to the base station) being a point-to-point communications link. On the initial cost side. This has resultant cost implications and also raises potential planning related issues in both the urban and rural context. A wider area based rollout will require many (repeater) antennas due to the limited reach of the high frequency microwave cells.

html Box 24b: Background System The system's single Base Station is located in Faro de Moncloa (Madrid). and transmitted to the Headend through the upstream point-to-point microwave link.cableaml.75 GHz band. any model would require to be business-based in the first instance to enable a commercial service to become established. which to date has not been achieved across the Atlantic. Also included is the carrier modulation and de-modulation equipment (at IF frequencies) and the RF up and down conversion equipment for both the downstream & upstream carriers. with latter repeater-based cells being significantly reduced in price.com/madridtrialsystem. The upstream signals from the subscribers in the 30. houses all the Network Access infrastructure as well as the Network Management Center.25 . the equipment required to package data in a format compatible with the Access Systems. and transmitted through two 180° antennas.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ BOX 24a: The Madrid LMDS System Architecture Source: http://www. A redundancy Unit provides automatic back-up of both the transmit and receive Base Station functions.85 . The Headend includes all the Network Access equipment. The System's Headend. processed. .31. and the equipment required for inter-connections between subscribers. located at Madrid's Polytechnic University Campus. The downstream carriers from the Headend are translated to the 28.4M. the receiving and processing equipment for multimedia services. It is connected to the Headend by a two-way point-to-point microwave link. although as such services grow this magic figure becomes more realistic.28.15 GHz band are received through the same sector antennas. BOX 25: The Customer Premises Equipment Configuration Costs of setting up an initial 5-8km LMDS cell are quoted in the US as ranging from £350K to £1. However. amplified. According to HP the key entry price for CPE needs to be in the £100 per subscriber range. for a complete 360° coverage at a power level of 5 Watts/carrier.

there has only been a limited penetration in a select number of urban locations. This will without doubt increase costs of rollout and add to uncertainty regarding the level of service penetration achievable. rainfall rate (about one inch per hour. For example. in the US context one of the main constraints has been the lack of standards within this industry. which is not uncommon) LMDS frequencies are attenuated by 4. Various differences in each approaches characteristics will make one more appropriate than the other depending on issues such as the location of the main customer base and the 'burstiness' of the communications which prevail over time. of Washington DC.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Its high capacity and range of resultant tiered service may mean that LMDS certainly becomes a major contender in the top end of the market. ADSL However.5 dB fade at its outer edge.wirelessdesignmag..5 dB/km. LMDS transmissions in the millimetre wave band are highly susceptible to rain fading (as well as foliage and terrain) and this is obviously an important consideration in the current study region. due to concerns over health. provision to residential locations remains problematic due to problems related to foliage and hills in particular.com/] . in comparison to the lower frequency MMDS spectrum. In addition.totaltele. providing spectrum costs do not inflate to the levels of the recently auction 3G spectrum in the UK. given the bandwidth available – in competition terms there will be many opportunities to charge much lower monthly costs for comparable bandwidth being accessed from elsewhere e. In contrast. In practice then LMDS appears less appropriate to the rural Western Isles situation than the MMDS solutions considered previously. However. according to the Strategis Group Inc. many residential neighbourhoods are not keen to be in the vicinity of microwave propagation technologies.01 dB/km for the same rainfall rate.g. there is a significant service range and resultant cost penalty related to the additional unit cost of infrastructure per subscriber.S. in a world of increasing bandwidth demands and that is an unsurpassed value of service. In terms of rollout. after the issuing the LMDS spectrum licenses in the US. LMDS has the ultimate cost advantage though. "Less than 5% of U. In addition. However. some providers base their architecture around 'Time Division Duplexing' (TDD) whilst others prefer and promote 'Frequency Division Duplexing' (FDD) as being the most optimal method of dividing and sharing frequency amongst subscribers." [http://www. although LMDS provides high bandwidth services. businesses are covered by LMDS systems and by 2003 LMDS network coverage will be close to 20% of businesses. about 0. MMDS frequencies are affected negligibly. this variance in approach in the industry to date has affected both interoperability and costs. hence presumably giving fixed terrestrial infrastructure the edge in such instances." [www. Two years on.com/] Rain-fade will therefore tend to reduce the range and reliability of the LMDS service in high precipitation environments. along with the lack of high enough sites in which to place repeaters. "At a 30 mm/Hr. so that a small cell of 3 km radius suffers a 13. urban centres are the ideal locations for LMDS spectrum services with their high rooftops and dense subscriber market.

which means an operator spends dollars only when a revenue paying customer signs on) No stranded capital when customers churn Cost-effective network maintenance. • • [Source: www. Nevertheless.com' include 1. internet access. most of the capital investment is in the infrastructure. 2. as the technology and operators mature as an industry sector. for example. The initial 28GHz band spectrum will be focused primarily at business use according to the RA. In Spain. Interactive television and streaming multimedia from Web sites.gov/lmds. LMDS has several key advantages over other broadband technologies: • • • • • Lower entry and deployment costs Ease and speed of deployment (systems can be deployed rapidly with minimal disruption to the community and the environment) Fast realisation of revenue (as a result of rapid deployment) Demand-based build-out (scalable architecture employing open industry standards ensuring services and coverage areas can be easily expanded as customer demand warrants) Cost shift from fixed to variable components (with traditional wireline systems. Spain's second-largest fixed-line operator. is currently deploying Alcatel's LMDS solution in Barcelona and Palma de Mallorca. with further extensions planned in Valencia and Zaragoza later this year. the first wave of broadband wireless access network activity in the UK has been in this area of spectrum. libraries.wcai. On the other hand. In recognition of this potential. even although the latest rounds of spectrum bidding and activity in Europe have been in this particular area – refer to section 6. The target market of such solutions are small to medium-sized urban-based .html]. health care providers. as will the soon to be auctioned 40GHz spectrum which are in many respects competition to traditional fibre solutions at the top end of the access market for large businesses. Alcatel. in Europe. local exchange telephone service. while with LMDS a greater percentage of the investment is shifted to customer-premise equipment [CPE].nist. is an example of one of the global-level suppliers of such products and claims to have over 100 LMDS customers installed with over 3000 base stations in service throughout Europe and beyond.com] Two of the first key services for LMDS anticipated according to 'whatis.2 for details in the UK. one has to question the relevance and practicality of this particular technology for rural locations. as there appears much competitive potential to other developing technologies. again one has to recognise the level of investment spent on the licenses purchased. High-speed data transmission for businesses and. Retevision. and rural communities" [http://nwest. and other broadband services. it is the promise of 155Mbps connectivity 'through the air' that is the main attraction to service providers and according to industry commentators and promoters. this being justified by expectations of LMDS service revenues estimated in the $1billion range in the coming decade.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Yet the original US rollout scenario promised license holders being able to offer: "…. It is expected that this assortment of services will benefit not only residential and business consumers but can also assist in fulfilling the telecommunications and information technology needs of schools. Nonetheless. A diversified and competitive access market is a key aim of the UK government and such a focus will lead one step closer to this reality. and operating costs. management.

in an average propagation environment. large businesses. This is of particular note in the UK. However. for the LMDS services. It is commonly stated (e. transmission speeds are now increasingly measure by bits per second rather than baud. WebPro Forum) that LMDS will be constrained on distance (and the propagation environment) rather than capacity.htm] as there is arguably sufficiently large availability of bandwidth within the LMDS architecture already.5km. The term quaternary (or 4-angle modulation) alludes to the fact that the phase is shifted in 90° increments. where the RA's consultation paper on 28GHz spectrum has indicated that it is unlikely to feed consumer demand services." A clear business focus.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ European country to develop LMDS pilot projects in this telecoms area (refer to Boxes 24 & 25). In . but also a clear urban focus too. including multiple amplitude and phase states such as QAM. due in part to its higher cost and indeed larger size of transceiver. It is hoped within the industry that the development of the so-called third generation of wireless telecoms will pave the way for the adopting of industry standards in the LMDS sector. enabling a resultant increased competitive route to broadband provision. As stated earlier range for a 99. 16-QAM: 16-Point Quadrature Amplitude Modulation.com/main_frame. The throughput in QPSK systems is thus twice the baud. it needs to be recognised that LMDS is not a competitor to 3G technology. It is no coincidence that this initial service was also in an urban area where it was to: "…provide Private Networks and User Multimedia Services to institutional customers. which transmits 4-bits for every Hertz of frequency. it could be argued that LMDS broadband wireless systems have limited requirements for increasingly higher order modulation techniques which are both more expensive and complex to implement. It is also worth noting that the introduction of more complex modulation techniques results in a lower customer service area. In addition.g.99% availability service is likely only to be up to 5km at maximum. The service itself is reported as having symmetric data rates. QPSK: Quaternary Phase Shift Keying – An efficiency increasing spectrum modulation technique. "As the modulation formats become more complex. as far back as March 1998 and by December of that year applications for a commercial service in the Madrid region had been lodged. as this can now involve the transmission of more than one bit of data.avren. Further increases in data speeds are apparently a straightforward process with higher forms of modulation e. with 64-QAM solutions limited perhaps only to 2. ruling out its present mobile potential. due to the increased signal strength required for its effective implementation. but. but rather that of specific business locations such as industrial and business parks. spectrum efficiency technique.g. then the amplifier must exhibit a more linear gain and phase response in order to preserve the integrity of the modulating signals and minimise spectral pollution caused by intermodulation products" [http://www. 64-QAM. The theoretical limit of QPSK is to provide 2-bits for every Hertz of frequency. quality of service issues regarding the availability of the service will further restrict the range of the product. where the baud can be considered to be the basic measure for the data transmission speed. is a more advanced again. However. and Small Office / Home Office Users (SOHO's) located in high population density areas . of initially 2Mbps and 10Mbps with QPSK and 16-QAM modulation. 'One baud is one electronic state change per second'. as increasingly more advanced modulation techniques have been introduced. In this instance the measured transmission rate in bits per second will be 4 times the basic baud rate of the signal.

interactive-gaming. distance learning. In the US. Virginia Tech. By forming a 'research consortium' to progress its vision. 'Touch America' provide a portfolio of 'last mile' telecoms in which LMDS plays a significant role and is providing the range of added-value services outlined above. telemedicine and videoconferencing have become widely available in its cell coverage areas. Obviously. Internet. regardless of geography. with the right combination of partnership resources. there are particular problems in urban areas related to the 'noisy' environment present. with perhaps the trade-off being its lack of mobility. Without such initiative then. to traditionally non-commercial areas. data. targeting multiple outcomes incorporating the wider community both residential and business alike. With a 3 month rollout. which do not exist in many rural areas. because of the increased complexity of signalling. this technology has been provided to rural communities and businesses at a very early stage in this technology's development. implemented by WavTrace. Virginia Tech chose to take an active role in helping to ensure that LMDS technology is made available. That is not to say that such an initiative could not be implemented.: "Believing many regions of Southwest Virginia would be left behind by this technology. There certainly does seem to be many instances in other countries where the traditionally thought-of public sector has been instrumental in levering in new technology which have been poorly served by incumbents with little vision or impetus towards serving up broadband to the non-commercial sector. due to the limited range of LMDS and low subscriber density present. Another examples from the US gives a possible indication of a potential route to add LMDS broadband services to a Highlands & Islands portfolio. videoconferencing and video services. This appears to be a very interesting model aimed at levering in new telecoms technology to rural non-commercial areas and hence potentially applicable to the Highlands & Islands.4 Unlicensed Broadband Wireless This area of the spectrum in the UK has much potential in enabling the speedy rollout of microwave broadband radio services in rural areas. There can be little doubt that investors in LMDS spectrum licenses (28GHz) will do so in the hope that in the long run they will be able to provide digital two-way voice. LMDS or other high frequency microwave services will not be an economic proposition within the Highlands & Islands in the near future. although there is no need for the purchase of specific ." Virginia Tech specifically targeted LMDS due to the very fact that it has been viewed as an urban based technology and that it would be able to bid for spectrum in its own and surrounding rural areas without competition. similar to the Madrid example. 4. As we shall see.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ due to its higher frequency and wider bandwidth.

with the aid of a burgeoning supplier industry.cisco.2. using license exempt solutions in the ISM bands offers an attractive solution to the coverage problem. Inc.com/ Wireless. RFA systems using the 2. without increasing initial deployment costs significantly. Some of the companies and their unlicensed band products include: Cisco Systems 'Aironet 340' http://www. which stipulates a maximum EIRP of -10 dBW. by extending reach to shadow and other non-economic areas. aimed at providing a cost effective broadband alternative service to that offered by the incumbent telecoms supplier. this being a common standard at this frequency range in many parts of the world.com/ Breezecom 'Breezenet' or 'BreezeACCESS 2.breezecom.com RadioLAN 'Bridgelink' http://www. Indeed many suppliers of the ISM equipment also manufacture core MMDS technology in conjunction with RLAN products. Comment will also be made on the viability of the higher 5GHz unlicensed band. "For those areas of a given geographic region that do not meet the minimum number of potential subscribers to justify the expense of an MMDS base station.4GHz unlicensed band as a result? The main interference which limits operations in this band come from several main sources according to the Radiocommunications Agency (RA) in the UK.wavelan. as for most of the products reviewed.com/ Lucent Technologies 'ORiNOCO' http://www.4' http://www. (on average) as opposed to the 11Mbps advertised. This is not the full story however. the unlicensed bands have been used to complement MMDS core networks. real-world throughput tests. as radio systems in the ISM unlicensed bands must comply with particular specifications.com/ The range of unlicensed band wireless products varies depending often on the manufacturer.radiolan. Wireless routers operating outdoors in the ISM bands are a mature technology and as such. Included in this list are . were disappointing at only 4-6Mbps.wire-less-inc.11b has been the key which has encouraged compatibility and competition in this sector." [RA & Aegis Systems Ltd] So what does this mean in practice and how limiting are operations in the 2.wmux." [ADC Telecommunications] In numerous instances in the US. Recently completed tests* showed that the Breezecom products showed strongly in the range of service achievable.com Western Multiplex 'Tsunami' or 'Lynx' http://www. On the other hand. a relatively reliable solution and most importantly a cost-effective solution as well.4 GHz frequency band must comply with ETS 300 328 and CEPT Recommendation 70-03. easily attaining services out to 24km in testing. Scientific and Medical) referred to in section 4.4GHz ISM (Industrial. [*Network Computing Online] The international standard IEEE 802.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ overcome. Indeed. 'WaveNet' http://www.proxim. Of most potential appears to be the 2. sometimes to supplement existing broadband services in rural areas and sometimes. there are at least a _ dozen competing manufacturers in this field who are currently in intense competition in this rapidly developing 11Mbps interconnect market. There are many examples of the utilisation of this band for broadband communications in both this country and further afield.com Proxim 'RangeLAN' http://www. "In the UK.

configuration flexibility and interface with existing stock control systems were also considered as being factors of importance." [RA & Aegis . stereo systems. There are certainly good examples in the UK where various organisations have taken the initiative and supported the wireless broadband route. Lancaster University Schools Network has networked sites up to 24km apart using a mix of both 2. The antennas used have been either directional (18 or 24dBi) or Omni-directional (10dBi).Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ and the increasing growth of Radio (wireless) LANs. Spread Spectrum techniques have been the key method employed to overcome interference problems (real or potential) in broadband radio solutions. In the Local Authority sector Stevenage Borough Council has networked LANs in 9 separate offices over a 25km2 radius via rooftop. The concentration of interference sources will be significantly less for service operations in the ISM bands outside of urban areas and quotations of service. In addition.reach of 32km+ are not uncommon for broadband equivalent radio based services. using several supplier's equipment. providing capacity of up to 11Mbps in the unlicensed bands. Perhaps of most note in our study context is the occurrence of Local Authorities and Universities in England. wireless radio access in the unlicensed bands has been much more feasible and indeed successful in the low density and resultant low noise rural areas. new 'Bluetooth' and 'HomeRF' wireless standards being developed for the integration and inter-operability of PCs. "Conceptually the technique is relatively straightforward.etc) will without doubt have a further impact on service reliability in the ISM unlicensed band.g.4GHz ISM product quotes service provision out to 60km+. mobile phones and numerous peripherals (e. In the private sector there has also been much interest in high capacity wireless networks in the UK.mounted 'wireless bridges'. with Littlewoods recently having 130 of its UK stores inter-connected via Lucent's WaveLAN product. Their network also includes 3 repeater stations to overcome specific topographical difficulties. who have invested in such wireless technology.. Indeed looking to the near future. the network connections have enabled 3Mbps sustained transfer rates between sites and over 20Mbps in aggregate throughput. TVs. and one would parallel the UK situation. with the core infrastructure being supplied by Breezecom. Cost savings in both instances would appear substantial. Operational since 1998. involving the multiplication of the wanted information signal by another wide band signal called a spreading code…The coded signal typically has a bandwidth many times that of the original information signal (the actual ratio is referred to as the coding gain and provides an indication of the resilience of the signal to other co-channel interference). Decoding of the transmitted signal is achieved by applying a replica of the spreading code at the receiver. where previously leased lines dominated communications.. For example Western Multiplex's 2. There are actually two separate techniques employed – Direct Sequence Spread Spectrum (DSSS) and Frequency Hopping Spread Spectrum (FHSS). digital cameras. Their decision to go wireless was related to both cost and a simplified rollout/installation of the network. including 3 of the main manufacturers mentioned on the previous page. It is clear then that limited service availability due to other interference sources in the same ISM frequency band must largely have been overcome.4GHz and 13GHz spectrum. Certainly in the US.

there would appear to be some real potential in rolling out some form of broadband wireless access systems in rural areas across the Highlands & Islands. Atlantic Telecom operating its fixed wireless access FHSS services in Glasgow. Dundee. to residential and small business users. There is clear scope for the education and public sectors to become the catalysts for rollout into rural communities. Aberdeen. FHSS is considered better at supporting a dense population in a small area. "Generally. DSSS is considered to achieve the highest levels of data throughput. to do this it is quoted as operating at the very limits of the EIRP (Effective Isotropically Radiated Power from the network base station) –10dBW. However. as .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Of the two types of Spread Spectrum technology being applied. On the other hand FHSS is generally considered to provide a lower BER (Bit Error Rate) thus giving more protection against interference.4GHz ISM band provides access speeds at up to 2Mbps for under £50 per month including all UK-based voice calls and a free second line.11b) for RLANS. The only downside of Spread Spectrum technology is the high signal processing overhead which makes it difficult to attain a high level service solution within the ISM band whilst staying within the standards and guidelines for operations set by the ETSI standard (ETS 300 328) and the IEEE interoperability standard (802. given the maturation of the technology (in response at least in part to industry standards) the low cost rollout (without the need to enter an expensive purchasing of frequency) and the relatively quite electromagnetic background. Glasgow and now Manchester in the 2. because it has more independent RF channels. providing existing line of sight knowledge can be built upon and used to minimise associated infrastructure costs. in these 'noisy' urban environments. whilst DSSS Provides greater operating range and coverage area (because it can operate with a lower carrier to noise ratio) and enables greater data throughput…" [RA & Aegis Systems Ltd] BOX 26 A Broadband Wireless and combined RLAN Solution from Western Multiplex In short then. electromagnetically speaking.

as stated earlier. with the use of the unlicensed bands to incorporate 'shadow' areas. recent focus in the UK has been on 28GHz and 40GHz spectrum.0-5. such spectrum may also present a commercial opportunity to bring broadband to the Highlands & Islands of Scotland. along with Kingston Communications who have also secured a regional license which was offered. Western Multiplex's Tsunami 5. But what about the current state of spectrum allocations and auctioning in the UK? As stated in section 4. similar to what has been implemented by ADC Telecommunications in several instances in the US. which is currently geographically limited in its coverage (i. according to the Radiocommunications Agency. with only limited focus on lower GHz bands with higher reach of service.e.4GHz and 10GHz spectrum also looks set to enter a process termed 'comparative selection' before the end of 2000. Hence a regime of licence exemption has been proposed.2GHz band Tele2 are in the process of establishing and developing wireless data and telephony services in the Thames Valley region initially. "Current plans for these bands are based on the assumption that all services deployed will be private systems operating on the same or a similar basis to fixed local area network facilities. In the 3. For example a company such as Iomart based in Stornoway could provide wireless bridge broadband access to communities up to 25 miles away at connections between 45Mbps and 100Mbps. There has also been recent interest in the 5. whilst Proxim's Stratum 100 has a tested throughput of 98Mbps under 'real' ." Certainly the proposed extension of license exemptions in the 5. due to Atlantic's success at operating a low power spread spectrum wireless service. local area provision to third parties would be forbidden.8GHz ISM band and the 5GHz band in general and a recent consultation process by the RA (January 2000) has been completed. as it has never been utilised in rural areas in the UK and may provide a commercial opportunity if released on a regional rather than national basis. which is now increasingly available throughout many of the regions in England.8GHz 100BaseT has a tested throughput of 38Mbps under 'real' conditions. if offered on a regional basis. This consultation seeks to establish whether it would be advisable and desirable to permit public access to this service in these bands.6GHz to 4. 2GHz spectrum. with expectations of rollout to as much as 60% coverage of the UK by 2003. While a private system providing internet access would be permissible under current policy.4GHz ISM range Atlantic Telecom (as mentioned above) dominate. to rural areas due to their limited reach. on the other hand. although some innovative venture to become 'selected' may be required in the shorter term. No assumption has been made of the presence in these bands of any type of third party or public access services. Ionica's former 3.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ An ideal system in the Highlands & Islands could have a licensed MMDS (regional allocation) spectrum core system. it is not a national license) looks likely to be released soon by BT. These bands will only be of limited interest. Again. The Agency is aware that at present there is no spectrum provision for local area public access to the internet. In the 2. Synchronous data rates of between 256Kbps and 1Mbps are offered as part of the Tele2 service.2.8GHz bands and its resultant opening up for 'local area public access' could have positive benefits to rural areas in proximity to a main node of high speed entry into the internet. With this consultation document the Agency is seeking to verify whether this is still an accurate reflection of the potential uses to which this part of the radio spectrum may be put…" "RLAN technology will certainly support access to and interconnection with the internet either on the basis of distribution throughout a private network or as third party distribution for public access.

[Statistics from BBC Online] Within the generation of mobile telephony products. unlicensed band services would appear to provide much potential to extend core broadband services to rural customers and further investigations outwith the scope of this study would seem warranted on the practicability and cost of such provision. may provide a significant internet access revolution.5 Universal Mobile Telecommunications System (UMTS) – 3G UMTS is the term used to describe the third generation of mobile telecommunications which will be available to consumers and businesses alike in 2002/3. The responses to the RA consultation are available for viewing (March 2000) although no final decision has been made for the future potential of this band as yet.150 to 5. when it comes.350 GHz. low power systems". with the former costing a more manageable £7K per link in April this year. with proven operations already out initially to 11km. The first generation of GSM mobile phones have been a true revolution in the European and UK context with over 34 million estimated users in the UK alone. 3G.8GHz bands. Thus at present: "It is not envisaged that this band is suitable for anything other than private. At present however within the existing ISM 5.875 GHz band "Recommendation 70-03 permits it to be used for non-specific short range communications at EIRPs up to 25 mW".470 to 5. Certainly. should a decision from the Radiocommunications Agency in the UK allow 'local area public access' via the 5. again as outlined above there is mature technologies available to exploit originating from the US.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ link. which could potentially exploit the rolling out of broadband internet to rural communities.725 GHz HIPERLAN bands. Performance has been quoted as being comparable to fibre optic based networks. In this sense. Ericsson fully expects the majority of internet use to be via mobile devices by 2003 and is itself expecting to be servicing 1 billion internet subscribers worldwide at this time. An indication of future use can also be guessed at when realising that 70% of teenagers in the UK now possess a mobile phone. For example the Proxim Stratum 100 for example has recently been approved for operation within the newly established 5GHz public bands in Canada. which have been shown to be impervious to snow. Within the 5. signing up / connecting mostly over the last two years. rain and fog.8GHz unlicensed bands. self-provided.05. In summary. It should be noted that current proposals envisage the extension of the unlicensed elements within this band to the 5.8 GHz ISM band the relevant equipment specification relates to conforming to I-ETS 300 440. which traditional telecom service suppliers must compete with. these network extension products designed to operate in the ISM and US designated U-NII bands provide much potential for rural areas. Both operate in the currently proposed unlicensed 5. 5. being suitable for internet backhaul services. unlike some other higher frequency broadband wireless solutions. Although.0-5. we are currently (autumn 2000) at 1 . 4.725-5.

theregister.6kbps only allows a very basic version of any site to be uploaded and the Japanese experience has shown this 1st generation to be non-user friendly in terms of browsing.html]. It is though the so-called third generation product UMTS (Universal Mobile Telecommunications System) that is of real interest within the realms of this study. which in itself will open up a whole host of market opportunities related to broadband connections. It is now anticipated that it will not be at least until 2003 that consumers access high data rate connections to the internet via 3G. the first 'internet' generation of mobile telephones. And if considering the Highlands & Islands consumer. Motorolla…etc) revisions in performance now indicate a more likely connection speed for GPRS as being in the 27-43kbps range. then this technology would appear to be realisable in the Highlands & Islands area in the not too distant future. maybe 2004.station infrastructure can be software upgraded to enable EDGE services. Nevertheless. not offering sufficient valueadded to entice existing user to ditch their current generation of phones. the connection speed of 9. recent industry (Nokia. The second generation of mobile phone technology is eagerly awaited with possible speeds for internet browsing between 115kbps and 171kbps. enabling a 2Mbps (in stationary mode / 384kbps on the move) direct connection into the internet. referred to as WAP (Wireless Application Protocol) phones are available in the market. this being quite a revision downwards by the industry. As its name implies. with 420million existing mobile users worldwide by December 2000. This clearly will make the 'internet' mobile phone an enticing piece of equipment for the vast majority of UK internet users today who are used to 56kbps connections to the internet. it will apparently be difficult to purchase a non-WAP enabled phone during 2001. However.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ mobile phones. However. Although it is obvious that the developing 'interim' technology (WAP and GPRS) is of higher profile at present. which uses bandwidth more efficiently by breaking up voice and data traffic into small chunks and only then sending them on across the GPRS enabled network. 3G is the universal broadband packet based communication system which is likely to be the main competitor to any and all of the broadband solutions assessed to date. Basically the WAP enabled phones have failed to catch the public's imagination. which in reality average between 45-52kbps. the market for this generation of phones has been slow to take-off in Europe with reportedly few companies making any money from this 1st generation of internet mobile phones. It is generally considered that the UK consumer is awaiting the next generation technology before discarding their newly purchased standard mobile phones. BT. a short battery life and limited memory and processing capabilities. Consumer products will come later in the build-out programme. However. However. WAP enabled WWW sites are not widespread. BT Cellnet's stated strategy for GPRS is to deploy it in the first instance to businesses in the South of England and subsequently a phased rollout to the rest of the country. [http://www.co. along the evolutionary highway of interim 3G technology is EDGE (Enhanced Data GSM Environment) based GSM technology which can deliver 384kbps and with Ericsson stating recently that its base.uk/content/archive/13307. Lastly. The phones themselves have been also been reported to suffer from the small screen size. but with the additional mobility . GPRS is a packet-based technology. then most likely even later than this. It is called GPRS (General Packet Radio Service).

095bn The one area of concern from the rural perspective from this 3G auction/purchase is that the 'minimum coverage requirement' for the 3G licenses at auction was 80% of the population by 31 December 2007. There are still consumers in the rural areas of the Highlands . This will be a true revolution in global access to internet content. data and multimedia traffic become a reality and the obvious merging of them to make videoconferencing a key application appears likely. the money spent and the resulting blocks of spectrum bought. In their bidding for. In line with the International Telecommunications Union's IMT-2000 vision. Source: BBC On Line The process of licensing 3G spectrum is in the process of being progressed worldwide through a process of auctions and 'beauty contests'. there appears to be very little in the way of a guarantee that our area will not be in the 20% excluded from the mainstream due to the 'uneconomic' conditions present in the area. UMTS will utilise spectrum in the frequency range 1980-2010 MHz with a 2170-2200 MHz portion reserved for the satellite element of the UMTS systems. with users connecting-in via a combination of terrestrial wireless and satellite links.3847bn £5.5bn was raised in the UK auction. The UK government chose the auction route for licensing the 3G spectrum and anticipated a windfall of £1bn for the exchequer. high speed voice. The table below outlines the bidders. Considering past experience in the Highlands & Islands. service providers and standards organisations worldwide) will mean that mobile users of laptop PCs and phones will be able to connect to a roaming service wherever they are in the world and access a consistency of broadband service access. particularly the Western Isles.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ component.03bn £4. on-line real estate the demand for such spectrum amongst the bidders surpassed even the most optimistic estimates. UK 3G (UMTS)MOBILE SPECTRUM AUCTION TIW Vodafone/ Airtouch BT One2One Orange Licence A – 2x15MHz paired spectrum + 5MHz unpaired spectrum Licence B – 2x15MHz paired Licence C – 2x10MHz paired + 5MHz unpaired Licence D – 2x10MHz paired + 5MHz unpaired Licence E – 2x10MHz paired + 5MHz unpaired £4.003bn £4. highlighting the future predicted dominance of 3G technology. based on the 'Global System of Mobile Communication' (agreed by manufacturers. A total of £22. in effect. With 3G. The universality of the service.964bn £4.

As things stand at present it seems unlikely that the core and peripheral areas already targeted for GSM services will be extended further. Examining the existing GSM services in detail from the various suppliers such as One2One." [whatis. there would appear to be no guarantee (as with the case with ADSL) of an impending rollout programme. BT Cellnet and Orange. in North Lewis Harris and the Southern Isles in particular. due to the ability of users to link up to any available interim service from any operator as the convergence towards 3G continues. thus making UMTS services in current 'shadow' communities unlikely. whilst the other 3 main providers have significant service shadows apparent throughout the Islands. On the positive side: ". A main concern then.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ & Islands that are not yet connected to a digital telephone exchange. If we are looking up to 7 years 'down the road' as it were for 3G in our area then it is clear we should be focusing our efforts elsewhere. far from the optimum solution. BOX 28 Orange GSM 1800 Service http://www. as no doubt a 2Mbps link in 2007 will be the equivalent to a 56kbps connection today – i.users can have multi-mode devices that switch to the currently available technology (such as GSM 900 and 1800) where UMTS is not yet available. to 3G should be available in the next several years.uk/gsm_coverage_maps. without once again significant public sector incentives. .. via network roaming.gsmcoverage.html UMTS will thus only likely become part of any solution for rural areas in the Highlands & Islands. particularly given the context of this study must be the coverage of UMTS broadband services in the rural and remote areas outside the main towns and centres of population in the Highlands & Islands. Even so the variance in service currently experienced should certainly be improved upon. shows that in the Western Isles context the basic service is far from universal. Perhaps at the very best we may achieve broadband 3G services towards the end of the anticipated 2002-2007 build-out.e.com] Hence. to either speed up the 3G broadband rollout to our area or to entice it here at all. In short.co. at least an interim service which will automatically upgrade the service available. Refer to Box 28. One2One has a largely nonexistent service. Vodaphone. some 10 years after the main upgrading programme.

e. whilst also offering comparable connections speeds. it has not been so much the consumer that has been driving the technology but rather the business sector.5G) such EDGE originally due for commercial rollout in Europe in 2001 (although now apparently delayed until 2002 due to equipment and testing delays) will enable enhanced 384kbps internet connections over that which is currently available in many rural areas. However.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ There can be little doubt that enhanced GSM services (2.000 to service. so when DoCoMo Net launched its new mobile 28. Looking West to the US. However. [www. within 12 months it had 4 million registered users and now has 8 million subscribers. . The US consumer market appears to be quite different however with a Forester Research survey showing that 75% of households did not value services such as receiving news. this being the final upgrade path to 3G for GSM carriers. dial-up internet access was billed by the minute). where there has been a marked growth in the remote and mobile elements of the workforce. it is forecast that there will be nearly 1 billion mobile devices in use throughout the world.com] If we look East to the Japanese experience then some indication of the potential becomes apparent. sports and weather on their mobile phones. making it the fastest growing internet service provider in the world. So what are the services that have enticed £24. multimedia content and instant messaging. However.5bn being spent on the 'big five' licenses in the UK? "By 2003. concerns have been expressed within the industry on the true real time speeds that will be achievable. interactive gaming. more people will access the Internet via mobile devices than through a PC within four to five years…The stakes are high – enduser spending on mobile commerce is expected to reach $200 billion by 2005 and the demand for infrastructure to support and manage new wireless applications is forecast to reach $25 billion within 5 years". perhaps the most interesting statistic is that 90% of the I-mode service subscribers are first time internet users. However. there is uncertainty in the market and service providers in Europe in particular are already considering skipping EDGE to move directly to another standard called W-CDMA. As well as web browsing the mobile service portfolio includes e-mail. thus the I-mode interface being the only one with which they are familiar.8kbps wireless service 'Imode' in February 1999. even here some commentators are predicting that 3G may never actually be implemented in its current envisaged form due to the time to market and the inevitable changes likely to take place. As a result of this penetration . In Japan in early 1999 there was a lack of cheap high speed internet access (i. with each user costing an average of $10. Infometrics Research in the US has predicted an increase of this component of the workforce by 30% between now and 2003. Non-shadow GSM areas that currently do not have access to ADSL or Cable will benefit and a new host of services will be possible.commonwealthassociates.

lead to a more streamlined route to the mobile broadband goal envisaged. In this context the major investment by UK providers in 3G frequency spectrum becomes somewhat more justifiable. In addition. it is the under 25 market that will most likely lead the mobile internet revolution. but rather more conservative 10-15 second video clips and this has obvious repercussions for anticipated revenue streams and its eventual worth as a broadband alternative for rural areas. which have the obvious advantage of not requiring investment in operating licenses and can therefore be piloted quite easily and in a short time frame. Indeed a recent survey in the UK has shown that young people are increasingly giving up cigarettes to run instead the ultimate fashion and communications accessory – the mobile phone. there is without doubt a massive potential subscriber base. It appear the technology’s performance will not now be able to handle true broadband services such as video on demand. the upgrade requirements will. 4." As a BWA technology it has begun to be exploited for the delivery of commercial broadband services in the US and other parts of the rural Americas and beyond. whatever 3G form this will eventually take. LMDS as a separate technology is where most spectrum licensing activity is in the UK at present in the BWA sector.. In this sense it has become a maturing technology with much apparent potential. by offering cheap high speed internet access. although not without risk.6 Summary & Analysis MMDS is as yet an area of untapped potential in the UK. although again appears to be an under-exploited robust technology. Indeed.. Broadband 3G and the interim technologies have been delayed however. described on the RA's website as: "an analogue service similar to MVDS operating in lower frequency bands around 2GHz chiefly for the distribution of broadcast material.8GHz products and solutions. . although having to operate within specific levels to avoid interference within and with other spectrum. one could foresee a 'Japanesque' revolution in this sector in the UK by the young adults of tomorrow who already have a grounding in mobile communication devices. as yet probably untapped. inter-active gaming. and may still be some years away (2003 at the earliest) for rural areas such as the Highlands & Islands. there may also be restrictions on third party services or the provision of public access services. due to its reach capabilities it is of limited potential to non-built up areas such as the Western Isles and Highlands & Islands in general. This market will be without doubt be a key area for the industry to convert. With regard to mobile wireless access via ultimately UMTS services or their equivalent. it has been stated. However.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In the US as in the UK. Of complementary and/or alternative interest to MMDS spectrum is the unlicensed band 2. although the question of accessing appropriate regional spectrum still remains.4GHz and 5.etc Hence. With regard to the potential of wireless terrestrial and mobile to provide a broadband solution in line with the Western Isles' needs there are several areas which need to be progressed and researched further. Investors in the UK 3G licenses have however expressed some concern in recent months regarding the technology’s ability to live up its hype in view of recent experiences by I-mode in Japan. with an expensive overhaul of GSM equipment ultimately required to provide full mobile 3G services.

economic development or education services/purposes may provide opportunities for innovative 'piggy-back' community broadband wireless networks. there may still be opportunities for community organisation based access to homes. targeting key communities such as Ness. Even if the Unlicensed spectrum is not to be made available for ‘public’ access. An obvious private sector partner would be Cisco systems given their presence already on the Islands. Balivanich and Barra. educational establishments and health boards in other parts of the country. Given the state of flux in the mobile wireless broadband marketplace there may also be mileage in entering into a research and development partnership at the Highlands & Islands level with one or more of the current 3G license holders to pilot cutting edge mobile broadband and ascertain its true performance abilities. these are technology solutions that have been used by other large businesses and local authorities. Likewise. Tarbert. for intervention in the market to assist rural telecoms infrastructure provision. to provide a broadband solution for key communities. a model of establishing public-private partnerships to lever advanced broadband infrastructure into rural communities has already been tried and test in the rural United States. with regard to mobile wireless broadband which will it appears be at least a contributory component in our broadband future it will be important that the infrastructure in the area is at least enabled to provide blanket GSM mobile coverage even in the most remote communities. Significant investment has been made in the spectrum and we need to ensure that the service operators are committed to 100% coverage rather than just the 80% of the population to which they are obliged under their current 3G licenses. In summary. must surely be a key economic and social development goal. The development of a wireless Western Isles OnLine broadband community. in the Americas for example. Lochs. but with spare capacity. in a short space of time. There is not shortage of evidence worldwide to support this opinion. health sector. Chapter 4 References: . with the key base station infrastructure being funded for initially core public sector functions. in the Broadband Wireless Access sector. The provision of BWA links for local authority. to ensure that the Islands are part of the mobile (upgrade) broadband revolution which is without doubt on its way when considering the advancements in countries such as Finland and Japan. Again. where a range of multi-functions are provided already by the public sector. BWA is a specific area in which an innovative local approach to telecoms development can be envisaged. Government funding to avoid any digital divide developing in the next generation would not seem unreasonable given policies for social inclusion and the acceptance elsewhere. In the short-term such initiative could bring real broadband opportunities for local communities in the Western Isles now. with mobile solutions addressing and indeed targeting any 'shadow' communities at a latter stage.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Firstly.

LMDS Lessons for Europe.com Radiocommunications Agency. Anon.edu/~rosner/LastMile.totaltele. 1999) http://www.com/ Phone.Ensemble Communications Inc. @ Commonwealth Associates.(Sept. Consultation on 3.(July 1997) . The Wireless Internet and Mobile E-Commerce (October 2000) http://www.com/ Kreig.Times Microwave Systems The Wireless Internet Connection .ericsson.com Hadar Rami .com Kelly. . Craighton D.com/main_frame.http://www. LMDS. White Paper:Enabling the Wireless Internet.(April 2000) http://www.com/solutions/license-exempt. An Introduction to Transmitter and Receiver Architectures (1999) Archive Library http://www. Andrew. Inc Use of License Exempt Bands to Enhance Broadband Services in an MMDS Network (2000) http://www.gov. & Ellingsworth.radio.commonwealthassociates.wirelessdesignmag.shtml Greiper.html Perelman. Inc.htm Radiocommunications Agency. Sanjay & Roman. Jorge Peréz (English Translation).cableaml.4 GHz Fixed Wireless Access Spectrum (November 1999) http://www. http://www.uk/rahome.avren.Wireless. Inc. Len Wireless. A.4 GHz frequency band (June 1999) http://www.wirelessdesignmag.html Moghe. Robert .. & Woods.commonwealthassociates. Wireless in the Information Age Delivering Interactive Multimedia to Workplace and Home (July 1999) http://www.uk/rahome. 2000). (February 2000) http://www. Cable Modems. Jorge E.com/solutions/license-exempt.html New York University. (August 2000) http://www. Michelle.radio. (Apr 2000) http://www.nyu.ADC Telecommunications Transitioning to Two-Way Data (Feb. Broadband Wireless Access .itp.gov. [Reprinted from Wireless Pay-TV International] The 50 Kilometer Myth: Realising Practical System Coverage . Vincent . Broadband Wireless: It's Already "Fixed" (May 2000) http://www. ( June 1999). David & Gee. UMTS and 3G .tsoa.phone.se/wireless/products/mobsys/gsm/subpages/umts_and_3g/umts_and_3g. Manu @ Commonwealth Associates Wireless Infrastructure: In the Eye of the Storm (1999) http://www.htm Restrepo.radio.org/conventions/nab2000/daily/wca1.com. Frank .wire-less-inc.com/ Kalia.html Bateman.ADC Telecommunications Sumi.wire-less-inc.wirelessdesignmag. 115 May-June 1999] The Madrid Multi-Access LMDS (28-31 GHz) Trial System .htm Donegan. Use of License Exempt Bands to Enhance Broadband Services in an MMDS Network (2000) http://www. Scott L.nab.gov.com/ Ericsson.htm Radiocommunications Agency. [Reprinted from BIT No.asp Martínez.com/madridtrialsystem.uk/rahome. and xDSL: A Comparative Study (November 1997) http://fargo.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ ADC Telecommunications & Wireless. Norman F. Compatibility between radiocommunication & ISM systems in the 2.

vt.iec.htm US Department of Commerce.edu/ WebPro Forum Tutorial. Asad. WWW Pages LMDS at Virginia Tech. http://www. Michael J. John LMDS: Broadband Wireless Access (Oct. 1999) Scientific American: http://www.lmds.spectrumauctions.gov/lmds.org/tutorials/lmds/index. What is LMDS? (1999) http://nwest. Welcome to the Wireless Internet (January 2000).wcai.html Utell.html Chapter 5 Fibre To The Home (FTTH) / Fibre To The Curb (FTTC) .networkcomputing. Wireless Bridges Span the Divide.html#6 Skoro.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Scourias. & Irshad. Local Multipoint Distribution System (LMDS) Tutorial (August 2000) http://www. (May 2000) http://www. John Overview of the Global System for Mobile Communications (October 1997) http://ccnga.com UK Government (2000) http://www.uk/3gindex.uwaterloo.com/1999/1099issue/1099skoro.html Smith.nist.com Virginia Tech.ca/~jscouria/GSM/gsmreport. (November 1999) http://www. Brad.gov.sciam.

1 An Outline of the Competing Fibre Technologies Even although the Passive Optical Networking systems appear to be getting much support . Fibre optic technology is clearly superior in performance and is now competitive in price with the high-end twisted-pair cable required for today’s high-speed networks. the main high bandwidth level of service to which foreseeable broadband networks will aspire and compare themselves to. The cost of optical fibre technology has also reduced significantly: "Fibre on the backbone. The long term argument for fibre via passive optical networking (PON) technology or via Gigabyte Ethernet technology is unequivocal. Refer to Boxes 29 and 30. one needs to carefully consider this 'ultimate solution' in the context of the broadband discussion to date. that’s been the book on premises wiring management. The continued price reductions for fibre cabling and components have brought the overall cost of fibre installation close to that of Category 5 unshielded twisted pair (UTP) copper wiring…No longer should fibre optics be considered an alternative to copper used only for applications with special requirements. Any 5-10 year rollout of such technologies may not prove cost effective due to their limited operational life as cutting edge telecoms technology. Just 10 years ago major investment in bringing ISDN capabilities to rural areas in our region was seen as a major infrastructure provision of lasting effect. For years. that a direct investment path to Fibre provides the best value for money option in the long term. and as we shall discuss in the next section there are also other examples of early rollout in the US which pertain to even more rural areas. that communities such as the Western Isles of Scotland where investment in broadband interim solutions has been largely non-existent. Unlike other broadband solutions such as Cable and ADSL which often tend to exclude rural and even suburban locations. are being discussed. FTTH is the surest way to future proof any broadband telecoms network today in the year 2000. Given this background then. However. It truly appears to be the 'holy grail' particularly for currently under-developed rural regions.networkcomputing. For example Bell South in state of Georgia installed its first FTTH network to 400 homes in the Atlanta suburbs. Bandwidth will not be determined by the constraints of the technology. currently promising/offering between 1-10Mbps. when one regards the near unlimited speed achievable and the bandwidth attainable. particularly if innovative rollout solutions can be identified. but rather the consumer's needs. 5. new methods to provide FTTH avoiding the main costs associated with digging up the road and pavement.com] In addition. can address. copper to the desktop. If our past experience and continuing knowledge of demand for bandwidth tells us anything. in the US some of the best early examples of FTTH have been in just such areas on an initial small scale. It may be." [www. One example is the provision of fibre to homes via the existing sewage duct infrastructure. such technology has now been overtaken before even significant market penetration has been realised and we are assessing where our next key investment should be focused. That book has now been rewritten due to the dramatic cut in cost of installing fibre to the desktop.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 5 An Overview of the Potential FTTH and FTTC are the 'holy grail' of broadband communications and. it is that future demands will continue to increase at a pace faster than the rollout of the interim broadband technologies. particularly the former.

given recent experiences in the US." In summary. and ease of management simply aren't warranted in the Etherneteverywhere scenario. • Light weight. hence the designation as being 'passive'). as can be seen in Box 29. there are concerns that the PON FTTH networks currently being rolled-out 'en-masse' in the US may not be as future proof as the newer Gigabit Ethernet infrastructures. make it a very viable community networking technology. ONUs may be located on street locations or in the users premises and NIDs. Fibre optics would not even be considered if it did not offer distinct advantages over traditional copper media. and without going into the technology in any depth. acceptance and support. typically being 10Mbps and are also more complex to roll-out. • Smaller size. in terms of service provision they are limited in the true bandwidth available to customer. • Electromagnetic immunity. speed of response and basic simplicity. scalability. PON systems on the other hand. will be located on user premises. widespread availability. in seconds rather than perhaps days or weeks. Ethernet is a proven technology with a much simplified interface which saves on cost. On the other hand. In this respect they also tended to be significantly more costly with regard to the network equipment required. • Safety. Concerns about cost. • Security. interoperability. In addition. • Low loss. The termination point of the overall system will also determine whether we have a FTTC or FTTH system. scalability. expensive and of little relevance to all but the most large scale . are less straightforward and contain several key elements.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ AC power. These advantages translate into the following: • Information-carrying capacity. difficult to work with. In response to such positive attributes fibre has traditionally considered to be fragile. scalability. ONUs Optical Network Units NID Network Interface Device The OLT or 'headend' may be located in the service provider's nearest office or at the head node of the overall system. although from the limited information available it is difficult to make an informed decision. " Ethernet's performance. arguably higher. they do contain constraints which make them less ideal than the new Gigabit Ethernet based fibre systems. enables higher throughput (in comparison to PON) and allows greater flexibility of service. The latter have the apparent advantage of low cost installation and maintenance. in so far as an Ethernet based infrastructure can enable multi-service provision down the 'pipe' consumer choice is expanded and the overall quality of service which can be achieved. when necessary. together with advances in hardware. ♦ ♦ ♦ ♦ OLT Optical Line Terminal A passive splitter that direct wavelengths at the network interface point.

Indeed in 1984 British Telecom achieved an important first by laying the first submarine fibre optic cable to meet the telecoms needs of the Isle of Wight. in the long term business cycle. the first submarine fibre cables became operational across the Atlantic and then a year later across the Pacific between North America and Asia. Further steps make faster signals and send them through fibres. Clearly. FTTH trials over the last several decades have generally not proved a success due to a lack of any 'killer' service applications able to utilise the technology. and electronics processed or amplified the signals.55-megabit signals to make a 45-megabit signal. Two years later in 1988. Typically.2 An Overview of the Technology & Developing Market A single optical fibre cable can provide a quoted 100Mbps link to individual service subscribers. but the fundamental architecture remained the same. in a series of steps.55 million bits per second. the 'interim' technology outlined to date (for all its potential) is equivalent to no more than the 2400bps connection of 1992 in comparison to the 2Mbps DSL connection of today.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ businesses. its cost is now on a par (maybe even less) with that of 'category 5' copper and its high capacity and bandwidth make it the essential future-proofing technology. the next step interleaves 28 of these 1. As outlined in Section 1. with the convergence of the internet and other consumer devices. so given future bandwidth requirements. At the fibre output.techreview. called multiplexing. breaking it into component parts for redirection. on-line revolution. with no let up predicted. a fibre enabled region becomes a significant potential inward investment site.com] It is interesting to note however that fibre optical cable in the communications network is still a relatively new provision. advances in the technology has made installation significantly more straightforward. in terms of quality of service. For standard telephone service." [www. This situation is quite different today in broadband world in which we are beginning to enter. They typically demultiplex it. On the other end. A laser transmitter pumped pulses down fibres made of exquisitely pure glass. a receiver converted the light signals back into electrical form. one could easily anticipate the revenue benefits associated with the plethora of new broadband services to outweigh costs significantly. 5. "Transmission speeds in commercial fibre systems had increased by more than a factor of 50 by the early 1990s. In the 90s for example there has been a commonly quoted 20 times growth in bandwidth demand. only being introduced nationally to the backbone when deregulation opened up competition in the long-distance phone network in the 1980s. Electronics do the combining. being increasingly integrated via 'bluetooth' wireless standards. Fibres ran from one electronic box to another. In actual fact optical fibre has a greater tensile value than copper or steel fibres of the same diameter. Sometimes they amplify and regenerate the signal. Then later in 1986 the first fibre optic cable across the English Channel came into service. and a potential major growth centre for existing businesses migrating to the e-commerce. other electronics process each signal. and often combine these parts with pieces of other signals and send them through another fibre. new ways of working are already beginning to shape our economic future and . Only an average 15-25% increase in costs in laying fibre as opposed to copper is often quoted within the telecoms industry. they digitise voice signals from 24 phone lines and merge them into one signal at 1. On the business front. allowing it to pass essentially unchanged through another length of fibre.

En-Touch Systems Inc. of major interest is that one of the key initial customers for optical fibre suppliers in the US (e.e. rather than in regions where fibre has been supplied as a direct replacement for existing copper networks.) has been small local telecoms suppliers using fibre to supply broadband services to rural homes outwith the reach of ADSL and Cable e.g. Full Service Access Network (FSAN) is currently a fibre standard approved by the ITU and subscribed to by many of the major telecoms suppliers worldwide such as British Telecom. terminal equipment) installation and supply to businesses and homes alike. (Houston) is targeting the emerging market of the residential consumer. one might argue. Verizon Communications (October 2000) have identified that the key components to enable FTTH i. Marconi) price the installation of FTTH on a par with DSL.. similar to the branched rollout among homes as seen in the US in a number of high profile instances. Optical Solutions Inc. Telecom suppliers can already make a cost effective case for supplying fibre to areas with just 100s or even just 10s of homes. FTTC and FTTB (Fibre To The Building) are in many instances in the US being rolled-out to residential customers in the first instance. even included rural customers. with FTTC being the norm in upgrade situations to date. supplying a branch rollout between buildings. Rye Telephone of Colorado City is installing fibre "to 500 homes in a sprawling 80-square-kilometer community called Hatchet Ranch. The implementation of standards across the board will also help. It is worth noting however..Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ continues to 'lag behind' for the foreseeable future.etc. the price of fibre itself and one-fibre 'PON architecture'." The general trend has been that fibre is coming closer and closer to the customer and in the US this has. it is just now that the US telecom industry is beginning to focus on FTTH in new build situations. 'self-supporting fibre cable and fibre drops'. Coming back to reality. In addition. …delivering bundled services to customers being overlooked by most of today's business-oriented providers. "While most optical access bandwidth providers pedal the benefits of fibre-optic technology to business centre customers. Bell South. 'aerial fusion splicing'.g. France Telecom. as we have seen. This initiative has been . Such standardisation of fibre access technology to homes and businesses will surely only serve to drive down prices further of (e. FTTH. that the focus of fibre rollout in the US has predominantly been in regions experiencing economic and population growth. but full FTTH has remained expensive until recently due to the terminal equipment required. have all combined to make the price of installing fibre on a par with that of copper. Nippon Telegraph & Telephone.g." British Telecom's current focus on fibre rollout in the UK is focused on supplying fibre to the main commercial centres in the UK. However. In some instances a quoted price of $1200 (£850) per home. where new build opportunities have presented themselves.g. or instead turns itself around and becomes one of the most significant growth centres in rural Europe. However recent announcements relating to new equipment coming to market (e.

Subscribers to DSL. they fail to take into account residual values. Yet there can be little doubt of the interim nature of such investment. In considering FTTH one can confidently make the case that its value will actually appreciate over time. and ever changing bandwidth demands of residential subscribers. as more broadband services emerge to utilise the potential bandwidth available. It is the only infrastructure that has the bandwidth and flexibility to address the large. "For those with a vision of offering all of the services subscribers want today and the services they will want tomorrow. in addition to on-going line rental and equipment and line testing costs with only a limited number of customers available due to the high pricing required of in excess of £40 per month for the basic 512Kbps service. wireless. as when new bandwidth demands become apparent. satellite…etc in this future will likely need to change supplier and technology to meet their needs. puts it: "…those who still believe FTTH is too expensive on a per-subscriber basis are either ill-informed or operating from dated information. held back by BT's resistance to giving open access to its full local exchange infrastructure. £150K per site. In realisation of the potential lead being taken by competitors. growing. yet on the other hand continue to roll out ADSL. Recent research for the Gartner Group suggests consumers are not willing to pay more than £25 per month for such a service. Even then the exchange infrastructure is proving costly for competitors at approx. an FTTH infrastructure is really a business necessity. Its rollout in the UK remains constrained. and as new higher value services come on line (with their associated revenues) the opportunity cost foregone is likely to be even higher. cable. venture capitalists have literally been falling over themselves to invest in this next generation broadband technology. One would expect a high level of customer loyalty in the long term.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ the existing copper infrastructure of such telecoms suppliers is not easily written-off. to the incumbents. 5. this may present an opportunity to jump a generation in the development of broadband infrastructure in areas such as the Western Isles. to utilise existing copper infrastructure. though as indicated earlier. as an ever emerging array of broadband services continues to bring ever increasing bandwidth-demand requirements onto such networks." [Optical Solutions ." Certainly for the 60-70% of households that can get ADSL in 'enabled' areas it is a major advance on a 56Kbps modem connection. As Joe Dooley of Optical Solutions Inc.3 The Case for Fibre Infrastructure Incumbent suppliers such as BT in the UK appear to cling to the idea that fibre remains a costly alternative. in supplying fully fibre solutions to customers. the fibre customer's pipe can simply be opened a bit further to enable any new bandwidth-hungry services. One of the main criticisms that might be directed at such interim technology is that although it appears to provide value for money for suppliers in conventional terms. This loss of potential revenue for alternative suppliers in year X is not likely to be shown in conventional accounting assessments. However there is not even a commitment to supplying this interim technology in rural areas such as the Western Isles.

instead of maintaining an ageing copper infrastructure (in rural areas such as the Western Isles). providing some innovative solutions to address initial rollout costs can be identified. However. Replacement fibre is already as cheap as replacement copper. The Danish government’s ‘Info Society 2000’ programme has already stated its intention to lay down in the first instance a country-wide optical fibre network to all the nation’s municipalities. there must even be a case for incumbents like BT.4 Summary. The technology is improving rapidly however to address such remaining issues/concerns and some estimates predict FTTH being available universally throughout the United States within 10 years. Posing the question of whether to reinvest in their ageing copper infrastructure. instead of inevitably at some later stage 'down the line'. "For carriers and their customers.. with costs of fibre solutions set to fall even further. The Rye Telephone Co in Colorado provides an example how forward–thinking telecoms carriers are already addressing fibre issues. to. interim technology will have to be upgrade at further cost to ? – FTTH! Hence. There are without doubt issues relating to robustness which have to be considered and related maintenance (management) issues. much of which was requiring constant upgrades. upgrade direct to fibre at an earlier rather than later stage in the business cycle. Analysis & Comment Many still view FTTH as overkill since immediate needs are being increasingly catered for by DSL. as has been the case in the US.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In short.etc It should be noted however that initial ducting cables lain by the main telecom suppliers in the US in the last 10 years contained 'dark' fibres. but which is committed to bring broadband to the whole country. In Ireland a similar broadband initiative is now underway utilising fibre optics in the first instance between key sites in the country’s network not presently ‘future-proofed’ with fibre. Wireless. after more costs have been incurred to maintain a decreasingly reliable infrastructure and satisfy some interim broadband needs in the short term to stave off criticism from OFTEL and others. This will become an increasingly imminent decision faced by (a) carrier(s) in the UK and there would appear to be one clear answer – now rather than later! 5. With such a long-term perspective there can be little doubt that fibre is the first choice investment for today." [Optical Solutions Inc] If one subscribes to this view. for an area such as the Western Isles. To counter this potential loss. Due to the additional revenue which can be attained by upgrading now. it’s a no-brainer: Those that get FTTH first win. spare capacity for future demand. then a clear development path for the advancement of broadband in the Western Isles becomes clear. repair and extensions. which are not always immediately able to be addressed and in some instances may even be weather dependent. Alternatively.. In Denmark such concerns have not hindered investment. on the basis of present trends. the onset of internet based demand was not foreseen on such a wide scale and a study in 1999 showed that some carriers such as Sprint in the . a clear economic justification for the replacement of the old copper with new fibre was apparent. rather than a depreciating alternative. there may be opportunities for new entrants into the local loop interested in building-out a long-term appreciating infrastructure. what investment decisions in other technology over FTTH will miss is the opportunity cost of lost customers and the loss of revenue from as yet unrealised future broadband services. Cable.

future investment may be brought forward to achieve economies. on the future economy of the Islands. one could argue its impact will be significantly more than any bridge. Community based broadband projects. as would the ability to provide add values social (development) .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ US for example have already lit up to 85% of its reserve and AT&T 50%. then one could easily foresee FTTH being able to provide a range of added value services for carriers of over £100 per month (Forrester Research–Beyond Broadband). consumers. In terms of opportunity for rural residents such services would really be the much talked about 'distance shrinking' technology. Inward Investment and new business opportunities would be significant.about. an undersea fibre link to the mainland would be the ultimate solution. Ideally. The spending of tens of millions of pounds to provide key infrastructure for remote communities in the Western Isles is not a radically new concept. The 'dead' may kick themselves for not embracing FTTH when they had a chance. telecommunications companies can be categorised into 2 groups . should another proposal targeted at laying an undersea link be tabled. but the extension of current microwave backbone links could without doubt be achieved cost effectively to support an FTTH rollout in the Western Isles. although perhaps more costly. Capturing an opportunity such as that presented by fibre to the home requires a determination of will and vision to invest heavily today in infrastructure which will appreciate and pay dividends for communities at some time in the future. similar to those by tenants associations in Sweden. would be unlikely to be surpassed by any other single development commitment and investment. In this respect it may be worth investigating if any of the Utilities possess any spare undersea ducting from the mainland to the Islands. " [www.com] Certainly in business terms there are huge revenue rewards to be achieved for those businesses or indeed areas arriving first in a market with an existing and a futuristic range of products and services able to be developed. with internet traffic said to be doubling every six months. as suggested in sections 6 for Wireless or in partnerships with private sector telecoms/content providers.the quick and the dead. in broadband rollout. road or causeway has ever managed to achieve to date. hence the extension of fibre networks worldwide is inevitable and the surest way to build in future-proofing to any technology investment. one must consider the economic development potential of entering such an advance broadband market so early. "These days. but it is rather the nature of the development that is different this time around. This aside. And. An ever growing customer base and an appreciating infrastructure are two clear economic reasons for FTTH. Given that ADSL costs £40 per month for a very limited broadband service on top of existing voice calls. It is potentially a 'win-win' situation if recognised. one of the leaders (in Europe). Either way. The jumping of a generation from narrowband to the 'holy grail' of broadband can actually be considered to make economic sense for carriers. The demand for bandwidth is unrelenting. service providers and businesses alike. in development terms the impact of FTTH or FTTB for that matter. might be a way to secure new infrastructure or perhaps on the back of public sector upgrades. Certainly Scottish Hydro Electric possess undersea cables for the national grid infrastructure. and although no new undersea cabling is anticipated within the next 10 year timeframe.

Chris. The Trouble with Fibre-To-The-Home (September.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ internet/e-mail videoconferencing. HDTV. 2000) http://lw. education & health services. Jeff.asp Gall. New Push for Fibre To The Home (June 1998) http://www.upside.com/home/home. teleworking. video-on-demand would be easily incorporated down the same 'pipe' as well as a host of as yet unknown services. 2000) http://lw. Joe.com/home/home.com/ Communications Industry Researchers: http://www.com/fibreopticsonline/default. Fibre-To-The-Home Approaches: Cost Parity with Copper (October 2000) http://www. banking.com/Ebiz/ McDonald. Fibre Optics to the Home (May 2000) http://www. Although.htm Hecht. FTTH networks installed now will continue to be appreciating in value. In such a fast moving industry of increasing importance it would be folly to invest heavily in a rural area in anything other than the most future-proof technology on the market. or Holographic TV/Video. Marketing & Comm.cfm Fibre Optics On-Line Web Resources: http://www.pennwellnet. Jeff.pennwellnet.kmicorp. hence. because of the almost unlimited capacity available. World Wide Packets. Devon. Sky's the Limit with Ethernet over Fibre (November 2000) http://lw. give the time lag in rural areas will still be only in the middle of their lifespan in areas such as the Western Isles.com/articles/ma00/hecht.s Manager. we have the main case and justification for investment in fibre optic infrastructure. FTTH Architectures face Interconnect Issues inside the Final Mile (October 2000) http://lw. How much is it worth? (September.techreview.pennwellnet.com/ O'Mara.com/home/home.cfm .cfm Hecht. Chapter 5 References: Bates. Chris.eoenabled. Scott Sumitomo Electric Lightwave. perhaps Virtual Reality.htm Dooley.pennwellnet. In 5-10 years as the lifespan of other broadband technologies comes to an end after being superseded by bandwidth demands. Octavio & Setty. rather than coming to the end of their lifecycle.com/home/home.wired. Don & Shapiro. George & McCreary. New Pipelines Promise Unprecedented Speed (August 2000) http://www. VP of Access Network Marketing. Marconi Communications (Irving. Scott.com/home/home. KMI Corporation. Mitch. FTTH: How much does it cost? vs. As one Californian community working with their local council on a pilot FTTH project stated – the new infrastructure will provide an invaluable asset for our children and our community and provide a lasting legacy.pennwellnet.cfm Morales. online gaming. Mark. 2000) http://lw. TX) Creating an Ideal Infrastructure for 'Futuristic' Services and Applications (September.cir-inc.cfm Oakes.com/reports/default.

both social and economic. There's more to local Access than DSL (September.com/ Pease. 2000) http://www. Continued economic stagnation and population decline are issues which the author discusses everyday with people from all differing backgrounds throughout the Highlands & Islands.co.cfm Wolinsky. arguably. although this may not be immediately obvious to many. Children from an earlier age are becoming part of the digital information society. Children from an earlier age are becoming part of the digital information society. is the immense development potential looming just over the horizon in both economic and social/community terms.com/Ebiz/ ZDNet. What will retain children in years to come in remote Islands like ours? – not just the quality of life. the current development paradigm of conservatism and consolidation and the conventional wisdom of diversification. what is clear from the research. both social and economic.pennwellnet.uk/news/specials/2000/04/broadband/ Chapter 6 Broadband Telecoms: Conclusions To many at this time. http://www. However.zdnet.com/home/home.upside. In doing so the writer is aware of. awareness and It requires a strong vision and a belief in the future to bring about change. Development is about long-term quality of life gains and sustainability. which has cumulated in the formulation of this report. Rural Areas Present Better Business Case for Fibre-To-The-Home (June 2000) http://lw. Robert. Broadband Access Guide (April 2000) http://www. often before their parents.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Optical Solutions Inc.com/index1. Development is about long term quality of life gains and sustainability rather than short term materialistic gain and it is the former that a realisable broadband future for the Western Isles could without doubt bring. It requires a strong vision and a belief in the future to bring about change. lead to re-population and attract significant publicity. the importance of establishing this vision might not be clear. often before their parents. Our children will need the opportunity to earn income in line with their aspirations and attain services from this future broadband society in their .opticalsolutions. Optical Boom Spurs Visions of Grandeur (August 2000) http://www.htm Ovum Research.ovum. Howard. but also the opportunity to earn income in line with their aspirations and attain services from this future broadband society in their home area. A key policy decision now could reverse youthful out-migration within 5 years.

” No doubt the ‘change’ will take even longer in remote island communities off the North Coast of Scotland if we do not grasp the current opportunity now. ferry and air services were in the last century. It is rural customers in the . A synthesis of the information gathered to date. The increasing pace of development is unrelenting in the technology and communications field. investment. just like many of the WAP-3G telecoms suppliers are already doing. If we can break free from this harness. which will never prove economic or reach mass-market status. because of the next generation arriving so quickly.g. Broadband will be the new enabling communications infrastructure for economic development in rural areas. before being abandoned .e. A synthesis of the information technology. Upon this realisation. Such a cycle of catch-up may even prove to be depressingly unrelenting in the years to come and do nothing to address economic stagnation. as new adopter sites increasingly take a higher share of the spoils.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ also been shown to raise average incomes significantly. just as attract publicity. In market terms the Western Isles are always going to be at a competitive disadvantage in our current development paradigm. then we could conceivably become a high technology rural development zone. we could become a high technology and communications field. of laying new fibre will be It is paramount for the Western Isles to future-proof any the greatest” investment undertaken. points directly at fibre optic cable as being the key enabling technology for a number of reasons. The Ovum ‘Broadband Network Infrastructure’ report states: “In the long-term (10yrs+) fibre to the building will The conclusions from such analysis are surprisingly clear and become the main access were certainly not anticipated. bridges. points directly at fibre optic cable as being the will take longest in rural areas where the distances key enabling technology. it is rural customers (because of the We need to jump a ageing infrastructure faced by telcos and its need to be generation. Contrary to popular belief. just as roads. development zone. As the soon to be published Ovum ‘Broadband Network Infrastructure in the Highlands & Islands’ report states: “In the long-term (10 years+) fibre to the building will become the main access technology. as new A decision now could opportunities are realised reverse out-migration. ferry and air services were in the last The increasing pace of development is unrelenting in the century…. the significance of our route to our inevitable broadband future becomes realised. awareness and inward roads. cutting out the cost of interim solutions. We need to jump a generation. This change will take longest in rural areas where the distances and hence cost of laying new fibre will be the greatest. Investment in leading edge technology now will give us an economic advantage for the first time in decades. ISDN. This change gathered to date. meaning that any interim technology rural investments made will never become available mass market. upgraded) in the US that have been named as being the driving force behind many fibre deployments by telecom suppliers. Broadband will be the new enabling communications lead to re-population and infrastructure for economic development in rural areas. bridges. and combine the potential new opportunities realisable from broadband with the unique quality of Island life on offer.

It would be very easy to conclude. will incorporate the laying of ducting cable as a matter of procedure. regional and national and perhaps even international interests from both the private and public sectors. most suitable and most likely for the Islands. Broadband Telecoms Recommendations • There needs to be a subscription to the principle of the vision outlined above by the development agencies at the local level.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Evidence from case studies suggests that one could make the case that fibre is the most cost effective solution in the long term. CnES making a policy decision to link its offices throughout the Islands by broadband fibre. In such a scenario.g. The recommendation is that any further works related to digging up roads. regional and national and even international interests from both the private and public sectors. new builds… etc in communities around the Western Isles. . including local. Accepting the analysis provided then. One could make the case that fibre is the most cost effective solution in the long term. • There needs to be a multi-agency development partnership set up at the highest level. but because of the added social and economic value which could be realised. new builds…etc in communities around the Western Isles. There needs to be a multiagency development partnership set up at the highest level . are unambiguous. via the sewage pipe infrastructure) and potential for cost effective rollout would also need to be examined. • A full cost/benefit analysis would need to be commissioned to provide the basis on which to build the vision for a ‘connected community’ strategy. The conclusions and vision outlined above however. one could envisage the need for numerous public sector incentives for various suppliers and operators of varying descriptions. any of the other solutions would need to account from the opportunity cost of not providing cutting-edge fibre services. pavements. this in effect. A commitment from the public sector to upgrade its links throughout the Islands may be the necessary catalyst for the private sector to build-out broadband into adjoining communities e. A 'diversified' range of the interim broadband solutions will not be ideal for the Islands. the chance of realising a radical and lasting shift in the islands fortunes will be gone. begs the question how do we get where we want to be going? as being the driving force behind many fibre deployments by telecom suppliers. To achieve this in a reasonable timeframe. In such a scenario. that a 'diversified' range of the interim broadband solutions will be the best.g.local. pavements. Assessments of existing opportunities (e. being the catalyst for the ensuing development process. right up to the national level. will incorporate the laying of ducting cable as a matter of procedure. or This will mean that any further works related to digging up roads. Not only because it has come down in price to the cost of copper installations. A full cost/benefit analysis would need to be commissioned to build the vision and identify clearly the goals achievable. the chance of realising a radical and lasting shift in the Islands fortunes will be gone. Conversely. This level of commitment from the development agencies will be an early way in which any future vision can be worked towards.

The current internet revolution and associated convergence technology and the resulting effect on society is surely of a magnitude never again to be experienced by our current generation. but also that of the next generation. • A wide ranging financial assessment would need to be undertaken to assess the level of incentive required. If one accepts that the ICT revolution currently happening is on a par with the agricultural and industrial ones of our past then we must. • Broadband wireless could without doubt be rolled-out on a much shorter timescale and is the most 'suitable' interim Broadband wireless could technology and appears to be an additional area worthy of without doubt be rolledout on a much shorter additional consideration.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ undersea fibre link also requires consideration.20-30 years from now. It is surely time that a long imagined visualisation of a ‘connected community' in the Western Isles was established. having long lasting significant economic and social impacts. timescale and is the most 'suitable' interim technology. and having long lasting significant economic and social impacts. with this single key opportunity. It is time that a long imagined visualisation of a 'connected community' in the Western Isles was established benefiting the whole community. In development terms there is surely no competing opportunity awaiting to be exploited. benefiting the whole community. The current internet revolution and associated convergence technology and the resulting effect on society is surely of a magnitude never again to be experienced by our current generation. and consequently assess the timeframe under which development could take place. A Final Overview There now appears to be a genuine willingness at regional and national levels to stimulate long-term sustainable economic development in the Western Isles. As one Californian community put it. Sustainability requires that we consider not just this generation. • The opportunities of an undersea fibre link requires consideration. ‘broadband fibre will provide a lasting legacy for our children’. . invest in the correct network infrastructure which will not only look after our present needs. thus achieving and indeed going beyond the present government's aim of rural social and economic inclusion in the digital broadband information age. and assess the timeframe under which development could take place. Wide ranging financial assessment would need to be undertaken to assess the level of incentive required. Time and community concepts also become a factor and if we are to build out a broadband infrastructure now it must also serve the needs of the future . Fibre-based infrastructure is thus the clear choice. but also the next.

A fibre-based solution enables service providers to deliver in-demand. fibre-to-the-home (FTTH). The attraction for service providers to growing customer base is offer a mix of video.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ providers to offer a mix of "Arriving first to market with an assortment of current and video. fibre-to-the-home. or fibre-to-the-office. . voice. this long-awaited technology is clearly built for the needs of the 21st century. this long-awaited technology is clearly built for the needs of the 21st century. and data services to an ever-growing that they can double or customer base is that they can double or triple their revenues within a triple their revenues very short period of time…To be poised for the future and sustain within a very short period success." Whether it's fibre-to-thecurb. bandwidth-intensive communications services and add these services to a growing list of offerings at breakneck speed. voice. the reality is that service providers may need to upgrade of time… the reality is that their networks sooner rather than later. a rich selection of next-generation services and applications. highly service providers may scalable technology platform capable of supporting unlimited amounts need to upgrade their of bandwidth will give those willing to make the investment to meet networks sooner rather demand. and data futuristic multitechnology services is a business strategy that offers services to an everwhopping revenue potential. or fibre-to-the-office. states: Whether it's fibre-to-the-curb (FTTC). than later. Deploying a powerful.

if value for money from such major investment is to be achieved. the UK has recently begun to relax its immigration laws for non-EU residents with ICT skills to plug the anticipated gap. IDC and Goldman Sachs point to a shortfall of 1. a recent EU summit on Technology.341 and rising . with current supply only contributing 11. a specific ICT skills development initiative in the Western Isles has the potential to ‘pay dividends’ in terms of employment creation and GDP gains given the current market outlook.5%. unless there is an associated concentration on the ‘soft’ infrastructure. Figures gleaned from studies undertaken by Datamonitor. In this context an under-utilised workforce in the Western Isles is less than an acceptable position to be in. An overview of several key and relevant aspects of the developing Information Society will be considered to help target and focus resources in the most value-added areas/sectors. The targeted development of the capacity and competencies of the local resident and business population. to enable access to the new ‘development cycle’ associated with the formation of the Information Society.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ PART 2 Chapter 7 7 The Information Society/Age: Trends & Opportunities The Development of the Information Society: An Introduction The identified need for broadband communications. identifying areas of opportunity for out-sourced work from the Islands. Case studies and overviews from other experiences in Europe and beyond will also be considered.7M workers in the ICT sector across Europe between now and 2003. Although if addressed. In this instance we are talking about the ‘people’ factor. IDC estimate that employment demand from the ICT sector by 2003 will be above 13m. will be as important a focus as the provision of the ‘hard’ infrastructure. as well areas of potential where new business start-ups could conceivably be progressed (to target developing opportunities). It is interesting to note the complementary nature of such a given initiative in view of the developing skills shortages in this sector across Europe. as identified in Part 1 of this report was based clearly on the notion that our society is going through a rapid and lasting change which will present new opportunities for rural areas such as the Western Isles of Scotland. given an appropriately skilled workforce. it has been estimated that productivity gains from this sector alone could increase GDP by 1. Innovation and Skills Training (March 2000) concluded that with average wages in the ICT sector averaging £29.3m trained persons. Such a viewpoint provides the rationale for this part of the document which will show that such a complementary initiative on skills development will be essential from the rural development perspective. will not necessarily maximise opportunity. Being clearly in line with developing EU policy. Indeed. The first part of this report concentrated on the ‘hard’ infrastructure required to enable future-proof access to the Information Society for residents and businesses in the Western Isles. Such access being considered of immediate need. one can argue. Consideration will be given to both the current and developing jobs market in the ICT sector. The associated loss to the EU economy as a result will be in the region of £37bn if such shortages remain. Furthermore. However it is not difficult to argue that such infrastructure alone.

along with various tax incentives. what is to be considered in this part of the report was proposed at this summit as being the possible solution to such developing problems – i. the development of public/private training partnerships and a reform of the education system in member states. in conjunction with the appropriate telecoms infrastructure. Ridgeway based in Reading.com and http://www. they will be very much interested in retaining an on-going relationship. 27% of which are experiencing delays lasting a year or more. but now it seems that if more centrally located businesses find an outsourced solution that meets their quality standards and targets.robertwalters.com) an increasing number of companies in Europe are focusing on external assistance via out-sourcing to address the skills gap. New websites have been targeted directly at this sector – http://www. If this supply-side friction can be negated then (b2b – business to business) e-commerce alone has the potential to increase EU GDP by 5% over two decades. given experience to date in developing and managing such out-sourced contracts.g.http://www. According to Forrester Research (http://www. England . until one realises that numerous companies in the EU already have been offering £1000 bonuses to staff who recommend a potential employee who is then taken on by the company. examining case studies and relating them to the Western Isles’ development context. due to growing skills shortages. there is clearly a major rural development opportunity awaiting to be potentially exploited. In the Western Isles context this market situation must present a huge opportunity. In the Western Isles context this makes a strategy aimed at concentrating on ICT skills development all the more attractive.com) found that even junior web designers are able to earn between £20-£35 per hour rising to £50-£70 per hour for senior Java programmers.” As a result of ad-hoc out-sourcing contracts much productivity is being lost and Forrester predicts and recommends a much more retention orientated out-sourcing environment developing. This section of the report will now go on to look in more detail at the developing market opportunities. and even then significant numbers of vacancies remain unfilled. Therefore one can argue that if the Islands can develop a value-added ICT workforce.ridgeway-sys. in view of such context.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ such staff their proportional effects on increasing GDP were significant. Again. EU Development Programmes such as the Highlands & Islands Special Programme must therefore be highly focused on such targets. “Two-thirds of the companies Forrester interviewed experience project delays or problems as a result of staffing struggles. In summary. given the current market conditions and development of the appropriate ‘hard’ and ‘soft’ infrastructure within the Islands.elance.co. .uk being just two recent examples.e. The internet itself is also providing direct opportunities for freelance and distance contracting work spanning the globe. A recent survey by the international recruitment consultants Robert Walters (http://www. Such projections may at first appear grandiose.forrester.freelanceinformer.com/) have offered a ‘£1000 bounty’ for any member of the public who recommends a potential employee who is later employed. the development potential would appear to be only constrained by the number of people available for work within the Islands. In other instances internet technology companies (e. Precious time and money are spent recruiting. Existing out-sourcing concerns have always related to the reliability of the work.

. broadband communications) opens up new opportunities for work in 3 main ways according to Botterman & Johnston.g. New ways of working can be made possible from any combination of the above effects. E-commerce. The question: How can we use the new broadband technology and skills to improve the way we work and create new opportunity? is already being asked and considered within this document and by several other initiatives within the wider Highlands & Islands context.g. arguably. which previously had to be performed in a particular place. A changing market where demand for labour has outstripped supply in the ICT sector has now made the asking of such questions a necessity rather than being questions for the large corporate. 2. Technology enables new activities to be undertaken. T&O is typical of the new work perspective of those EU citizens included in the new Information Society. as the customer or client in the Information Society requires reducing levels of direct face-to-face contact e.etc are all concepts with which such persons are familiar with. New questions related to: Do particular aspects of work necessarily need to be done in-house?. bank tellers. In this case where the potential opportunities for the key infrastructure recommended are already identifiable. more consistently and at a lower cost this means we can achieve more for the same expenditure in time. bookshop staff. Technological developments (e..etc For a further insight into the development of teleworking refer to Appendix 6. 1999: 1. only being acted upon to achieve some profile raising PR. knowledge management.. virtual learning and skills development. the opportunity cost in economic terms of not proceeding are calculable and likely to be high. was given as to how we might use it. providing the key infrastructure is present.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 7. effort and cost.1 Teleworking & Outsourcing: An Overview of New Ways of Working Teleworking and Outsourcing (T&O) are now seen as one of the leading examples of innovative new ways of working. whilst just several years ago the very concept of out-sourcing work was one to instil universal nervousness at the management level in particular. where minimal thought. if not active within. as they take on an increasing role themselves. enabled by flexible technologies. The potential for such activity has also increased. Technology enables existing activities to be done more quickly. Whole new approaches to improving and indeed re-engineering the way work is done are being pursued. expanding business opportunities due to perhaps: increasing the viability of additional . or can they be out-sourced to specialists? are being asked. or we can achieve the same result for lower effort and cost. Technology enables activities to be undertaken at a distance. This is a far removed scenario when ISDN-enabled exchange infrastructure was rolled-out across the Highlands & Islands.etc. which previously were impractical because of either cost or the effort required. travel agents. smart organisations. 3. The changing roles of the worker in the Information Age are already becoming well understood: doing work/managing work/selling work/buying work…. In this context the potential for location-independent out-sourcing development and teleworking increases further. globalisation of trade and markets.. organisational teams.

BT. in so far as the term is used in several differing contexts.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ transaction efficiency / business response time to customers and by providing access to specialist skills on a flexible basis. 7. 4. The remotely based teleworker who will normally be self-employed and possess specific skills which are utilised by distant businesses on a contract basis. One such example in Forres in the Highlands of Scotland employs several hundred people largely for the processing of parking fines in the London Metropolitan area of South East England. In short. This is perhaps the most commonly perceived idea of how to define a teleworker. 1. characteristic of the original term. who perhaps previously needed to commute and are largely involved in work for urban businesses. The former can be utilised by applying the latter to enable enterprise and opportunity to generate the activity required to stimulate the changes. There can be little doubt that as teleworking expands across Europe in response to skills shortages. This is without doubt the challenge for the Western Isles in the next phase of the Information Society development cycle.2 Teleworking & Outsourcing in Europe’s New Economy It is important to distinguish in the first instance one’s definition of teleworking. such work will only find its way to ‘location independent’ rural areas if the right infrastructure is complemented by the appropriate skills base. combined with the availability of the principal skills and knowledge required. So what are the opportunities in the ‘new economy’ for teleworking & outsourcing? 2. Sales. 3. This form of teleworking received much publicity in the UK during the rail strikes of the early 1990s when commuters had repeated problems travelling to London from the large rural commuter belt of South East England and began to turn to their locally based telecottages which previously had been largely non-commercial community based entities. usually on a contract basis. increasingly via Call Centres in the UK. Customer Support and Data Processing are characteristic of services provided from a distance. but who may work from home several days per week. . Teleworking in the context of this report will be taken to mean a new way of working for people in rural areas which is line with the first definition given below. The term used to describe the relocation of work (both 'front' and 'back' office functions) and employees to cheaper locations . rural) telecentre or telecottage. one can make a direct correlation to the arrival of the Information Society and the availability of the appropriate technology. The telecommuter who remains employed by a centrally located employer.e. Accounting. It is this concept which generates most enthusiasm among urban-based decision-makers wishing to reduce urban congestion and environmental (air) pollution. This is the type of new opportunity for remotely based rural populations which has been secured in the Western Isles of Scotland in recent years and which will be discussed further in the focus on the Western Isles experience during the last three years. The term encompassing people who work from of a non-central (i. the major telecoms provider in the UK has also sited a UK national helpdesk facility employing similar numbers in the remote town of Thurso in the Highlands of Scotland. with maybe some commonalties with definitions 3 and 4.

By 1999. One can consider some of the key elements and projects originating from each country which is or has aided the development of this sector. Such high specification core infrastructure allows a potential level of internet literacy much higher than many of Belgium’s rivals and will generate new broadband-based services in advance of other EU . Since the project started a core of 10 teleworkers gained employment on an e-commerce initiative being progressed by a large Austrian record dealer. The next generation will truly be the ‘net’ generation. Making available on-line. be they ‘virtual’ teleworkers or otherwise. An examination of the progress being made in Belgium also points us to some interesting examples of projects with applicability to the Western Isles situation. The success of this project led to it being available throughout Austria by 1999 and a further 250 people throughout the country were undertaking the course in that year. Other notable contributions from the Austrian experience include the development of ‘model contracts’ for teleworking/outsourcing. Cobol. Java.e. Such a model appears clearly focused on addressing and exploiting the current opportunities opening up in the EU ICT market. confidentiality. quality. SQL. WAP…etc and does business with distant clients. operating in a future island context where broadband is available. The project was a success in that it took the skills training to the rural dweller via investment in telecentres and included a wide range of basic application training. By 1999 95% of the population had access to 2Mbps+ broadband internet connections.evosoft. deadlines…etc Such traditional concerns still remain in the UK and it may be that there is a promotional effort required here in the Western Isles instance given the unique experience to date.be/) is an example of a ‘virtual’ company which pulls together groups of skilled teleworkers in particular areas of expertise i. The Ötztal Telecentre. Like Austria. Belgium has been doing much to lay the foundations for the next generation of the ICT literate and aware population.Austria). examples of past successful contract agreements/specifications or alternatively entering into the consultancy market in this area. C++. which may address traditional industry’s concerns in teleworking. DHTML. Of additional note in the development of the future skills resource required by a successful economy in the Information Age. in Umhausen (Tyrol . where shortages of skills are leading to outsourcing to by core urban businesses to external companies.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ There are numerous case studies of teleworking development across Europe which we can examine and analyse in the context of the Western Isles. is a good example of a rural ICT initiative originated in 1996 which was aimed at up-skilling the rural population (mostly the farming sector originally – ‘IT for farmers’) to encourage new teleworking opportunities by providing a core of broadly skilled ICT residents. Assembler. HTML. are but two opportunities of relevance from the Austrian experience. EVO-Soft (http://www. Visual Basic. 100 farmers had completed the courses developed. predominantly via Cable. Such a model is of enormous relevance to the Western Isles and provides the potential business development model for highly skilled groups of teleworkers. Austria was one of the first countries to offer free internet access for all schools in the country. a factor which in some instances has helped to ease the traditional concerns of business/industry relating to security. Delphi.

com is undertaking a similar role in the Western Isles of Scotland.fi/telework/english/). The Danes were also one of the first countries to adopt ECDL.exceldata. Denmark as a whole is often described as being one of the best placed EU countries to exploit the developing information society.4% of the population compared to just 31. Indeed the use of ICT has been quoted as being the driving force behind the transformation in traditional work practices in Finland. training and education. in the form of the development of UMTS networks.g. Not surprisingly Finland has been one of the key countries in the EU which is keen to address flexible and teleworking via the use of ICT. The Finnish ‘Telework Theme Group’ (http://www. leisure time.cnn. It is such pilot initiatives by high profile ICT sector businesses in the UK that the Western Isles must be in a position to exploit. For example .4% of the population in the UK (http://www. having developed several earlier version on a similar theme. very high rates of mobile telecom connections – 70. its Ministry of IT & Research recently produced the document ‘Realigning to a Network Society’ which states: “Denmark has commenced its conversion to the society which is going to take over from the industrial society: the network society.” As such the Danish government has identified a priority list of 37 key areas of potential for the year (2000) and interestingly its number 1 priorities is the development of a countrywide broadband Fixed Wireless Access network to enable competition with the existing incumbent. for example. Most recently the Danish Ministry of Education have developed the ‘Educational Computer Driving License’ an initiative of much relevance to the UK context. A recent survey by the EU has found that Finland is the leading Teleworking country in Europe with 16. while still preserving the best values of our welfare society. As such. The second priority also relates to broadband. Such initiative is very much in line with the innovative presence the business wishes to portray to its customers.dk/) an information systems and e-commerce consultancy has recently been involved in a successful satellite office initiative.8% of its workforce being involved. As ‘new ways of working’ projects (e.europe/).uta. a multi-agency initiative aimed at progressing a national ‘telework development programme’ is also targeted at aiding the establishment of ‘practical action’.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In Denmark there have also been notable contributions to the development of locationindependent working. . In all aspects of life . In short. Such synergy in development focus is encouraging from the Western Isles perspective. teleworking) are increasingly ‘fashionable’ image building events for innovative ICT companies and consultancies.work-global.8% of the population in the US and 46. with Sweden.com/SPECIALS/2000/e.work. culture and trade and commerce . Finland itself is considered to be several years ahead of the rest of Europe in the ICT sector with. the challenge is to make Denmark a leading IT nation.Excel Data (http://www. The Netherlands and Denmark being not far behind. At the regional level in the UK www. The promotion of broadband provider-based competition on a nation wide basis including Denmark’s many rural areas and island communities to include all its citizens is an area in which the UK would do well to emulate.this will offer a large number of new technologies and possibilities…The challenge will be to exploit the future possibilities by realignment in all areas of our economy and society.

fi/].” [http://www. Ireland has already demonstrated that the Call Centre industry can be a valuable contributor to employment geared around out-sourced activities. Previous issues of poor working conditions and 'burnout' among staff have improved as skills shortages have led to an improvements in conditions with starting salaries now being in the region of £IR10-14K. A national free phone helpdesk for teleworking enquiries (an opportunity for the Western Isles?) has also been recently been complemented by the organising of business breakfasts for corporates related to the opportunities in teleworking in Ireland. with great demand for persons able to speak a second European language.de/English/english. His pay and conditions of work are acceptable and teleworking has not been forced upon him. Furthermore. The Call Centre industry has played an important part in its growth. What is particularly interesting in the Finnish example is that: “…the typical teleworker in Finland is male.html). provide examples of best practice and give access to examples of previous contract agreements which have been undertaken successfully. on the infrastructure side the rollout of broadband nationally has become an increasing focus. In addition. Right across Europe much progress is being made in the teleworking field. A second language appears to be an increasingly in-demand skill which will complement the core ICT skills of persons in this sector and expand the European level portfolio of opportunities for ICT employment based initiatives. Such initiative could be considered desirable in the Western Isles regional context via both centrally located facilities and mobile facilities for rural areas. In France for example.de/tahtml/we_english/indexengl. Ireland has a population of 3. the French Telework Association has been in extended talks with France Telecom regarding future opportunities. is well paid and is working in a professional or a managerial capacity. an indicator of momentum relates to the number of major German ICT consultancy firms increasingly list teleworking as one of their ‘specialisms’ e. TA Telearbeit (http://www. Such integration of public services with ICT services could be considered as part of the preparation for an island context in which teleworking based on out-sourced employment contracts across broadband networks to/from the islands has been realised. It is interesting to note the demand for language skills in this industry as such centres expand to the European level. In Germany the Ministry for Education and Science has teamed up with three of the country's trade unions to develop an ‘employee orientated telework consultancy’ service (http://www.ta-telearbeit.onforte. .8 million and over the last several years has been referred to as the ‘Celtic Tiger’ because of its booming economy.g. Skills shortages have already become apparent in this sector. Finns have had free access to the Internet via their public libraries for some time now. Such initiatives have relevance to the UK. Amongst other things the site and associated service give advice and legal guidance for teleworkers.sak. This is of special note within this study context as the Call Centre industry is the fastest growing sector in the Highlands & Islands of Scotland employing over 2500 at the end of 2000. with the recent addition of £18M of EU structural funds to aid such universal connectivity. Teleworking as a specific opportunity has also been promoted at several levels in Ireland.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ With regard to preparing for the Information Society.htm).

With estimates of approximately 80. morale.” . A recent feasibility study for a 4 year pilot project costing 200M and funded over 50% from government sources. In the Netherlands in recent years one of the most impressive examples of new ways of working is related to the idea surrounding the functional office.000-25. Oracle accrued significant annual savings and measurable increases in staff productivity. holiday pay. It is also in line with steadily increasing educational levels. brightly coloured ‘jazzy’ work spaces in a network of 700 small-scale decentralised data centres.000 to replace a member of staff in an ever increasingly competitive ICT market. all achieved in a period of seven months. as a paradigm shift in big businesses’ obsession with scale towards a more humanistic workplace of smaller scale (with a sense of community.2% % of the working population involved in teleworking) are also worth mentioning. independence and personal responsibility. This state and private sector sponsored move towards flexible working at a reduced scale. designing office space to be more compatible with the home environment. loyalty. In this instance one must hope that this socio-economic experiment by the Dutch proves as worthy as several others piloted by the Dutch years before being introduced in the rest of Europe.000 persons living in the Hague-Amsterdam-Utrecht triangle during its lifespan. in attempting to boost company productivity. sick leave. hence potentially providing increased opportunity in areas such as the Western Isles According to the Netherlands Telewerk Forum: “Teleworking has become part of the culture in certain companies. and advertisements with teleworking as a secondary term of employment are also appearing.5% of the working population involved in teleworking) and Sweden (15... Ireland has also taken a major step forward for such members of the workforce by signing up and ratifying (only second country to do so) the International Labour Organisation's (ILO) Convention on Homeworking. As the ICT based jobs market becomes increasingly competitive from the employer perspective. is aimed at encouraging teleworking among between 10. Indeed the Dutch are being increasingly proactive in the teleworking / telecommuting field. but also to attract new personnel if certain expertise is becoming scarce in the immediate vicinity is becoming stronger. models of working based on employee retention and productivity must surely gain ground. This gives such workers the same rights as other workers – maternity leave.etc has been one of the leading lights providing cafes. in so far as they have spawned several projects worth noting in the context of this study. For the companies themselves. if proved successful could have longer lasting implications for rural areas. company loyalty…etc) units /centres will have obvious benefits for outsourcing initiatives to rural areas such as the Western Isles. the argument that teleworking needs to be introduced not only in order to keep good people.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Finally. minimum notice…etc Of the other EU countries that have been particularly innovative in the teleworking /outsourcing / ‘new ways of working’ sector. Oracle. This particular project won the Dutch Telework award in 1998. the Netherlands (14.

Dept.g. In Sweden the link between the need for broadband and the future demand for teleworking in the internet economy has been made. This situation places us far behind the more technology progressive European countries whose early adoption of new ways of working may very well give them a competitive edge. particularly in recent times form government sources. The government sponsored report which initiated this drive.asp) has articulated the importance of broadband to enabling increased teleworking in Sweden and has also set out to wire every household in Sweden with at least a 10Mbps Ethernet fibre broadband link. For example Bredbandsbolaget (http://www. the main telecoms player in Sweden is also keen to extol the virtues of broadband and the opportunities in provides for teleworking and videoconferencing. In short. of Employment Moving into the Information Age – an International benchmarking study . 10% of the UK’s total workforce will be involved in teleworking. So what about the UK then? It has been estimated by the EITO that by 2004. Telia. Nevertheless. it appears that Sweden as a nation is already undertaking many of the proposed preparatory works required to ensure that it will be a major 21st century economic power and the quality of life of all of its citizens in the Information Society will be secured. In the Western Isles context this report is in effect making a similar case on the micro scale in the absence of any similar national scheme in the UK. The concept of living in an Information Society without having access is not only an economic issue. the Western Isles) unless early adoption of the appropriate development strategies are implemented in advance. as witnessed by this selection of reports recently published: Teleworking and Local Government: Assessing the costs and benefits – Ursula Huws Working Anywhere .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ An anticipated replication of such a scenario and thought processes across Europe also shows promise for key areas which can provide key skills from a distance. but a major issue which will face policy makers in many uneconomic areas (e. The Western Isles in effect must find the commitment that the Swedes have shown on a national scale.bredbandsbolaget. there is a growing commitment in the UK to the concept of teleworking. whilst increasing global competitiveness significantly and therefore resultant employment growth.com/eng/node85.DTI Managers Guide to Teleworking . Sweden as a whole has committed itself to high-speed broadband internet access for everyone in the country and this has been backed up by government legislation and a resulting public-private partnership to implement ‘the world’s best information technology infrastructure’. It is clear that broadband and new opportunities related to new ways of working in the new economy are inter-related and some areas will grow and flourish and others will continue to lag behind at perhaps an ever increasing rate. to reposition their economy in advance of future changes in society. further stated that such infrastructure would lead to significant growth everywhere in the country.DTI The British and Technology – Motorola Report Teleworking Britain – MITEL Report Pay and Conditions in Call Centres – Incomes Data Services . By doing this they will be perfectly placed to exploit new opportunities in the new global digital economy of the 21st century.

mobile phone…etc penetration. lead to an increase in new ways of working and doing business over the next decade. This sector is still in its infancy. Indeed. particularly with broadband video conference communications just around the corner. 12 months is a long time in the Information Age! Nevertheless. providing we focus our future efforts on the areas of most opportunity. some of the jobs still advertise potential candidates to be based in certain areas of the country. Outsourcing and ‘new ways of working’ are being given increasing status by both government and business alike.g. Such developments were going to be predicted by this report and their related opportunities highlighted. at least in part by necessity to address increasing skills shortages throughout Europe. an increased commitment to the Information Age at national and regional levels in even a generic sense will. In some instances even the size of the average house in a particular country has been shown to be correlated with teleworking penetration at the national and regional levels. but it is not difficult to predict a much more geographically flexible scenario. providing infrastructure develops in such areas at an equivalent pace. . be they located in Lewis & Harris or London. In this sense the development of a highly skilled workforce in the Western Isles will not necessarily lead to out-migration.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ In short. albeit at a slower pace than many of our European counterparts where more progressive workplace legislation and government policies are making an impact . However. broadband. Teleworking. there is a cultural change taking place in the UK. skilled teleworkers in the ICT industry. Specifically. the development of such specific sites looking to contract out work to highly qualified. At present some watershed developments have happened in the UK over the last 12 months in particular. and may well grow significantly to be the way that the European ICT skills gap is addressed over the next decade. the type of projects required for out-sourced teleworking to become a reality in a location independent industry. PC. Areas and organisations with past experience and a work history in the sector must surely be increasingly strongly placed. highly paid. It should be remembered that the rate of adoption of new technologies e. It is such specifics we will address in the next section on e-commerce and the digital economy. has often been in the past correlated with the rate of the development of teleworking. In summary. one could confidently speculate. does surely a major opportunity. The development of new e-lance and free-lance sites on the internet have developed. as has been the case in the past.

in most instances have no geographical preconceptions and .com and http://www.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Indeed. other sites such as www.com/which are predominantly US based.elance.robertwalters.

500 people reliant on this industry. In this sense teleworking/outsourcing can be thought of as not only a technological innovation but also a sociological evolution of the linkages between managers and employees resulting in new organisational structures and new and innovative business processes both between businesses (b2b) and between businesses and the end consumer of their goods and services. Such employment opportunity information and active recruitment drives will help any strategist focus on areas of skills need. On the wider level we must also consider market competition. telework is dependent on post-industrialism. for example. In so far as these Call Centres can be location-independent they are also of interest within the context of this study. Added value opportunities will bring their own demands in the Call Centre industry. as stated earlier. makes telework more desirable for businesses now than in the past. integration of geographically dispersed companies and labour flexibility. such outsourcing has not been a common phenomena to teleworking initiatives. . As Marya Zamindar. there are now over 2. appropriate processes (for monitoring and control). cost savings (reduced staff turnover). many more related to inter-personal and communications (written & oral) in both English and another EU language rather than just technical. Indeed in the Highlands & Islands of Scotland.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Such sites have complemented the already booming recruitment sites spring up all over Europe and North America. one of the fastest growing in recent memory. set-up costs. To date. giving such individuals the industry experience required to return and develop new business ventures be they virtual or ‘bricks and mortar’ targeted at the new information society. instability and societal change." So what are we saying with relevance to this study? The post-industrial society in the UK (late 1980's onwards) and the associated structural changes in the labour force during the 1990's to increase the flexibility of employment (to reduce supply-side friction) and increasingly focus on project orientated (time-limited) tasks often involving team-based approaches would appear to have created a labour market situation which should be ready to embrace out-sourced teleworking on a significant scale. Given the demand. Telework in turn. issues related to distance and its potential impairment to teamwork are all of consequence when considering new ways of working. A greater need today for geographically-dispersed specialists. it is not inconceivable that any particular rural area could build up a self-reinforcing track record in the provision of skilled employees in the first instance. A clear opportunity is thus apparent for an area such as the Western isles which already possess a track record in teleworking. Finnish Ministry of Labour stated: "In one sense. forwards the evolution of postindustrialism by facilitating decentralised production. In this sense it is also worth mentioning outsourcing to Call Centres – now one of the fastest growing employment sectors in the Scottish economy. available technology (broadband). Productivity gains (40-60%). although as indicated above this is beginning to change.

Opportunity for The availability of real examples which can be quoted and from which testimonies can be secured is also of key importance. with a web presence and a track record appears to be a clear opportunity for The parallel development of on-line course and module development. The local public sector could be utilised to help establish credible and relevant track records for such teams. drawing on the European experience to date we can immediately identify several areas of opportunity of relevance to the Western Isles: • The development of virtual teams of skilled teleworkers. Opportunity for a parallel service to provide national free phone advisory service for teleworking enquiries for both business and teleworkers and website. • • • Promotional campaign to highlight the ‘cool’ of rural satellite offices within new economy sector. outsourcing and new ways of working developing in Europe and the UK of relevance to the Western Isles? It is essential that we understand the areas of developing opportunity within the EU economy (in the first instance) which can be exploited using ICT. The provision of a commercial consultancy service to aid structural change in urban areas. Promotional campaign to highlight the ‘cool’ of rural satellite offices within new economy sector – A statement of progress – ‘we have the technology know-how to even run an integrated office from the Outer Hebrides of Scotland’ .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 7.e. has been shown to be of significant benefit to other rural areas. Europe’s New Economy & the Western Isles Given the preceding discussion and overview. with set targets for the securing of outsourced contracts to rural areas (i. Also initiative based on business breakfast for key businesses has already been piloted successfully elsewhere. eg European Computer Driving License (ECDL) The development of virtual teams of skilled teleworkers. to convince and satisfy middle-management that such out-sourcing contracts have been shown to work successfully in the past. • • The provision and availability of past contracts specifications/agreements for scrutiny by potential business providers needs to be progressed. in order to be able to identify the types of skills that are going to be in high demand several years from now.3 Teleworking & Outsourcing. The availability of real examples which can be quoted and from which testimonies can be secured is also of key importance. what are the key opportunities related to teleworking. with a web presence and a track record appears to be a clear opportunity for development. In summary. the Western Isles) would also appear to have some potential to assist teleworking development. delivery (via UHI) in the core skills demanded. .

• • • • As already stated. given the above case studies and their relevance to development in the Western Isles teleworking context that a real opportunity exists in this sector. in addition to key ICT skills. to broadband in rural areas as in urban centres.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ unique team building events in rural context from beach barbecues to orienteering events. The specific skills demanded are already becoming apparent as one browses the emergent number of freelance and e-lance websites being rapidly developed. inter-personal and foreign language skills. it may take a proactive decision by the public sector in the Western Isles in the first instance to give new teleworking initiatives a track record and therefore a competitive foothold in a burgeoning growth sector. Opportunities for skills development to mature in-line with growth in outsourced customer service centres (call centres) to provide new level of communication.will generate significant new activities in nontraditional non-urban locations for business It is no surprise that the most heavily subscribed FE and HE and commerce. In the view of the author. with the following funding breakdown: 50% of funding for equipment and infrastructure 30% to business process re-engineering and 20% to education. A real opportunity exists in outsourcing. An idea of possible funding priorities in this sector was provided in 1998 when the EU allocated funding to ‘Telework Conversion Projects’ throughout Europe. In the new economy. in addition to key ICT skills. Opportunities for skills to mature in line with growth in outsourced customer service centres to provide new level of communication. as demanded by the public. outsourcing . to bring new skills into the area along locating teleworkers. .be it to call centres or individual teleworkers or indeed teleworker teams . to bring new skills into the with new contacts and possibly employment. . courses in the Western Isles are in the computing field. area along with new Highlight Swedish & Danish examples to The Scottish contacts and possibly Parliament . now. projection of positive image to customers…etc promote Islands as a Parallel campaign to promote Islands as a perfect location for perfect location for rere-locating teleworkers. interpersonal and language skills.be it to call centres or individual teleworkers or indeed teleworker teams will generate significant new activities in non-traditional nonurban locations for business and commerce. given the appropriate skills base and key infrastructure discussed in Section 1. Teleworking initiatives in areas such as the Western Isles require to capitalise on both public sector and market momentum to lever in both investment and jobs. It is going to take a proactive public/private partnership to be the catalyst for the types of development discussed to date. In conclusion. The rural Western Isles may have an opportunity to secure such business. The change is taking place in education. it is going to take a proactive public/private partnership to be the catalyst for the types of development discussed to date.of forward thinking in action which is as committed employment. New ways of working pilot Parallel campaign to projects. it is very much the view of the writer. but there is a worrying lack of realisation of how we will begin to meet the economic development needs of future.

as mentioned previously this is a key growth sector with specific opportunities for development to enable an increasingly competitive future for rural locations. As the personal computer has penetrated widely into both homes (over 50% in several of the Scandinavian countries) and offices during the last decade it has increasingly changed the way business is done and transactions completed (e. Indeed. “There has been a particular increase in demand for multilingual staff. During the late 1990s this philosophy changed to concentrating in-house on the business's core competencies and out-sourcing non-core functions. this is no surprise. as they increasingly embrace business opportunities. the Scottish Law Times multimedia processing contract.g. one could foresee a situation where the SME sector in the UK is going to increasingly require cost effective multi-lingual customer services. The knock-on effects have been that business. Such graduates one might argue would be very much sought after commodities in the new economy. Most of this demand was said to have been fulfilled by immigrant workers. As Europe increasingly integrates then the advantage will increasingly go to areas that can provide either bi-lingual or multi-lingual staff able to service the wider European market where similar customer demands are present. As we identified in the Irish example. If one subscribes to the idea of an ever closer integration of the UK and Europe. then an increasing amount of opportunities will present themselves. .or multi-lingual staff with the appropriate experience and skills is not an easy task for the UK SME sector. as the industry grew so did the demand for bi-lingual staff to service European-wide demands. (particularly ICT companies) has also had to modify how it operates. a new hybrid sector has become established – Call Centres or CSCs as they are now increasingly being called. The fastest growing industry in living memory? – What exactly is the relevance of the CSC to this study? Well. such as customer support.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 7.4 Outsourcing: A Consideration of Customer Service Centres (CSCs) In the 1980s and early 1990s the corporate philosophy was related to doing everything 'inhouse'.” [Robert Walters Salary Survey. In context. online purchasing).g. Why? – because they are utilising an increasing range of on-line services and have increasingly high expectations of e-commerce demanding instant service and solutions. August 2000] Currently the University of Paisley has identified these very future needs and has developed a specific qualification integrating both ICT and EU language skills. For example home PC users (and more recently internet TV users) are increasingly requiring both telephone and e-mail feedback and assistance 24/7. Multilingual candidates are hard to attract and as a result they can command premium salaries. to specialist companies under contract. Now in the year 2000. It is thus clear that in the Scottish/UK context there is a clear opportunity to plug such a gap and gain a competitive locational advantage in advance. Early successes in teleworking in the Western Isles in the late 1990s benefited from this ethos e. e-commerce-led or otherwise with their European neighbours. This would appear to be an area UHI could also legitimately develop and integrate perhaps right through its new degrees. Recruiting bi. In terms of skills development this would appear to an area of significant future potential.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Already in the ICT sector. The Cap Gemini Call Centre is referred to by the company as a business process management facility. The Western Isles could thus be expected to compete strongly in this sector for these reasons and a host of others already well documented – available workforce. emergency and complaint calls. Scottish Hydro-Electric outsourced call centre services to cover enquiries. IT. committed and enthusiastic people people with a combination of customer care. increased productivity. low costs of development (assisted area status)…etc. order processing. according to Locate in Scotland: "Throughout Europe. A similar type model to the above. for specific SME ‘niche’ products/services being sold increasingly on the web to our EU neighbours. keyboard and telephone skills a flexible workforce availability of skills training to sustain growth excellent communication links with clients throughout the UK . The proviso being the appropriate skills base being present.000 council tax and housing benefit applications. with an excellent choice of affordable housing and a safe environment for young families. but concentrating on UK business functions with the potential to be outsourced is that of Cap Gemini. Its Business Process Management has been developed to address the needs of businesses considering the outsourcing of some of their non-core current functions. recruitment. customers expect a technical help line to be answered quickly by an IT expert. As such this appears to be a development model with some potential on a smaller more focused scale." Other location factors mentioned by LiS in Call Centre location relate to the presence of a vibrant community. Cap Gemini has concentrated on generic 'back-office' functions such as payroll. customer care…etc Early clients included GRC outsourcing the processing of 20. It is not entirely inconceivable that the potential to provide everything from pre-sales enquiries to aftersales support across Europe. as mentioned in the introduction to this document. accounting procedures. Cap Gemini is the largest European provider of consulting and information technology services. An area such the Western Isles with a bi-lingual culture already would appear ideal for such an initiative. could be provided from a valueadded centre in a rural area such as the Western Isles. The development of broadband and appropriate skills development would surely lead to a highly competitive situation for inward investment. low staff turnover. In terms of future opportunity in the new economy such added-value CSC functions are real and early entrants will be able to establish a track-record in advance of the limited competition. Interestingly the company initially sought the following attributes in its location decision: • • • • • a pool of educated. who can resolve their problem in their native tongue.000 parking tickets. Three London burghs also outsourced the annual processing and payment collection of 300. computer.

and in advance of addressing the real focus of this section of the report. the above example along with Iomart’s outsourced Net Centre in Stornoway. With telecommunications going digital and even wireless. for better or worse. to be the measure of success of any area within the EU within at least the first half of this new century. one must consider the true buzz-words and their meaning and relevance to development in the Western Isles. It utilises the opportunities developing in the new economy and has the potential to establish a wide range of positions pertaining to a range of jobs of differing skills and pay levels. Such facilities can also provide invaluable ‘first’ job experience for school leavers and thus help retain an increasing number of our youth.. for many of the same reasons as those quoted above demonstrate the growth potential of this sector in the rural Highlands & Islands context. Exploiting them effectively is arguably. which located to a specific advance ‘office’ location in a technology-designated business park. Sponsored employee programmes could also be on offer for top performers.5 E-Commerce & the Digital Economy: Opportunities & Threats Finally. Only 5 years ago the . Appropriate focus on skills development and the associated infrastructure required in the Western Isles can lead one to confidently predict future success in this sector. It is the type of 24/7 service orientated industry demanded by 21st century consumers and purchasers of key services.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ • a relaxed environment with a high quality of life Cap Gemini specifically located to Forres for the following reasons: • • • • • • • positive findings from skills audit by GRC Scottish education system – quality of qualified staff in North of Scotland Quality of life aspirations for company executives and staff met BT's availability of ISDN Close proximity to Inverness airport Property costs. In short the CSC sector is an area of outsourcing which can potentially provide new opportunities in an otherwise stagnant Islands economy. anytime is becoming persistent – the very nature of the market place is therefore changing.etc are low Flexibility and quality of staff available In summary. an expectation of high speed broadband internet access being universally available anywhere. In many respects they are fundamental to future economic and indeed social development. For example such facilities could provide an invaluable opportunity for school leavers to earn some money prior to entering higher education. Moreover the market is estimated to be growing at 40% per annum 7. whilst also giving them key transferable skills. if targeted. They are the driving force behind all the recommendations and analysis provided in this report.. In this sense they are more than just buzzwords. but annual expansion of such spend continues growing at a phenomenal rate. to enable the retention of links with the company and islands. On-line commerce still accounts for only a fraction of our annual outgoings.

It is imperative that the Western Isles becomes a central player in the move towards the new economy. on the type of price-listing websites referred to above ‘value-added’ sections in the product categories are already developing in response to the near perfect competition on price increasingly being experienced. The Western Isles cannot afford to become a peripheral player. e-commerce and the development of an inclusive information society has the potential to increasingly shift the current global economic system to that of one approaching perfect competition. for if it is not. Although one might consider the growth of the ICT industry to be one of the main driving forces behind globalisation of the market place it is increasingly becoming the enabler for many industries as they recognise that both their competition and customer base is becoming increasingly global. Now in the UK it is available in close to 50% of all households. as well as much potential new activity being foregone.cheapflights. stock market flotations…etc National boundaries and associated laws are becoming increasingly blurred as technological convergence occurs and barriers to trade are reduced. In this sense the unique distinctiveness of the ‘Hebridean’ product will provide many potential opportunities in the global market. Although it needs to be recognised that we need to be part of it to benefit from it.pricerunner.co. quality and added-value will all be available at the touch of a button. the threat of further marginalisation within the Scottish/UK economy. appears to be a real prospect. The globalisation of markets. However it is worth noting the other side of the argument with regard to advance provision enabling participation in the digital economy. Already web sites such as www. There can be little doubt that our better connected urban counterparts will compete directly for ‘scraps’ in the digital economy.uk are providing such a service for the booking of air tickets. In other instances generic price comparison sites have developed http://uk. and therefore need to act appropriately and expand/diversify their operations to compete. The sheer volume of international trade occurring has increasingly made the collection of import taxes and duties more difficult for nation states within this global system. ICT is hence certainly central to such development. Deregulation of telecoms markets has resulted in the increasing globalisation and horizontal and vertical integration within the industry. There is a particular school of thought that will argue that unless demand-side activity can justify investment in broadband and skills . In such a global market place there must still be a premium for local products and services which possess particular value-added attributes. Indeed.com/ which enable consumers to get the best prices in the UK or indeed abroad on a wide range of ‘white’ goods in particular. nevermind the global economy. as location independent work becomes available. as further losses to the economy will ensue. A standard economic cost-benefit analysis will demonstrate the need for investment in this sector now. This is actually one of the threats that one can foresee to rural areas in particular which do not enter the global market at an early enough stage.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ internet was a cult communications technology used by ‘geeks’ or ‘nerds’. Full access to product and service information will become increasingly the norm and comparisons on cost.

Whilst one can argue that the availability of optical fibre and maybe even wireless broadband telecoms is likely to be a prerequisite for attracting inward investment. which we will discuss further in the next chapter. The problem seems clear within the current policy context. " [Owen Evans. It can be argued though that in this instance there is a clear justification for putting the horse before the cart. because of a lack of demand for the added-value services which could be provided by such technology. The high price of initial rollout broadband products in combination with their limited bandwidth (e. the absence of the appropriate ICT broadband/mobile infrastructure and associated convergent economic activity & skills development. it should be remembered that such strategies by development agencies will only lead to limited local multiplier effects in themselves. without early recognition of these opportunities exclusion will be an inevitable consequence. such areas in the new location-independent information society potentially have the greatest attraction to the new breed of ICT business with their high quality of life perception. but unlike Sweden and Denmark and several other EU countries. We are talking about requiring the key infrastructure to enable participation in a major economic and social opportunity. as innovation effectively develops where the conditions are right. The key to the regional development of the information society must concentrate on the developing of indigenous SMEs and related entrepreneurial activity. there is no apparent commitment for all its citizens to be central players in the new e-commerce revolution. Cable) and initial apparent reliability problems does not augur well for future rural rollout timescales. on the other hand. Increasingly innovative methods will be employed requiring an ever changing set of optimum skills. Policy . However. whilst enabling social inclusion. access to venture capital has been a key driving force in the development of the ICT SME sector in technology hot-spots around the world – one method of stimulating the demandside in rural areas which we do not have to. Yet. The UK government and its telecoms watchdog OFTEL have articulated their aim for the UK to become a centre for e-commerce. In addition. where the supply-side investment was by many considered to be a failure. In this context there can be little doubt that in areas of current 'market failure' such the sparsely populated (low demand) areas of the Scottish Highlands & Islands. A widening gap with regard to digital infrastructure provision is a real concern as demand for information society addedvalues goods and services remains low. current data usage will become increasingly critical as patterns of demand determine the roll out of future technologies. In response. where nobody really knows what the end use of such broadband technology will be. "Given that the market for broadband is in its infancy.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ ISDN provision supplied to the Highlands & Islands economy is an obvious example. ADSL.g. awaiting demand to lead to the supply of infrastructure will in this instance be self-defeating approach. is likely to prove a future inhibitor of investment and economic growth. one could point to the pricing of the product and its related services. a lack of promotion by BT and a lack of development impetus on the side of the agencies to encourage and foster new business opportunities utilising the technology. Hence.

Access to the Digital Economy and ECommerce opportunities is not guaranteed at an early enough stage for rural areas such as the Western Isles. New investment will inevitably slip until at some point in the distant future urban revenue streams pick up as demand increases and prices drop through increased competition.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ A resulting lack of revenue streams from the urban environment (a by no means unexpected phenomena) will lead to further reduced revenue estimates from rural areas. An immediate need for rural areas to embrace the information age and bypass this current situation would seem to be an overbearing priority. So what exactly are these opportunities? .

The ‘bandwagon jumpers’ without any solid business acumen have been found out and cast aside ruthlessly by the market. The economics are simple. Dublin.01 Internet 0. E-commerce or e-business and more recently m-business come in two distinct flavours business to consumer (b2c) and business to business (b2b).07 1 Internet PC Banking ATM Telephone Branch 0. over the last 9 months with the shake-out within the dot.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ 7.4 0. For example in the banking sector costs can be reduced significantly: BOX 31 THE COSTS OF BANKING 1.2 Cost Per Transaction ($) 1. Department of Enterprise. Ireland .015 PC Banking ATM Telephone Branch (Source: Booz-Allen & Hamilton) The introduction of the Euro. Nevertheless.52 0.8 0. Goods and services across national boundaries will be able to be directly compared for both the consumers and potential e-businesses alike. in business circles there was little surprise at the failure rate which is often as high as 90% in the ‘old economy’.1999 ] Arguably. One wonders about the potential financial sector developments still to be realised in relation to . Furthermore. for the banking sector the potential of attracting a pan-European customer based will become a reality. will herald a new transparency in pricing among European countries and may very well prove to be a stimulus for the growth of EU e-commerce.27 0. hence the well publicised demise of the dot. Trade and Employment.com industry.6 0.2 0 0. To paraphrase the wisdom of the experts 'in five years time there won’t be any Internet companies because they will all be Internet companies or the won’t be companies at all’" [John P Kelly.coms.6 E-Commerce & the Digital Economy: A Definition of the Opportunity "Companies and countries which fail to adapt to the new exigencies of the digital economy will be marginalised from it. this quotation increasingly rings true.

This will inevitably lead to intense competition and ultimately a significantly better deal potentially for SMEs. The successful internet entrepreneurs of the last several years and without doubt the next several years will be those individuals who can recognise the on-line commercial opportunities in advance of the masses. cultural (mistrust of technology). Nevertheless. to embrace the Euro may give future competitive advantages to continental banks in the new networked Europe. to date. such as market places or trade fairs. The result should be lower business/production costs as cheaper and more reliable suppliers are found. However. the information search costs are similarly likely to . Specialised infrastructures for the organisation of commercial transactions are obviously needed as they have existed since the Middle Ages. Location independence is once again a feature. The emergence of virtual malls is likely to replace the physical infrastructure. On both accounts. information highways are likely to significantly reduce costs. The increasing focus on b2b from b2c by recent high profile examples such as Urban Fetch and LetsBuyIt are characteristic of such a movement. With regard to rural locations this will mean an enlargement of market opportunities combined with more competitive input costs.. CDs. legal (regulations). for particular goods and services and have access to the appropriate skills and technology to exploit them. and quality (of products & services available)…etc Many such issues are being actively addressed by government and industry. holidays and an increasing range of ‘white’ goods and consumer electronics. TV. books. This range is continuing to experience a dramatic increase in quantity.Another essential cost feature associated with commercial transactions is of course the information search cost preceding a possible transaction. economic (short-term capital costs). PC games.g. and more recently malls of various sorts in suburbs of cities…. choice and diversity. 2000] The barriers to growth of e-commerce to date and which in some cases remain for the present include technical (encryption/security). In transaction theory these are called the ex ante transaction costs….Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ It may be that the UK's reluctance. getting back to the economics. there is a core of goods and services that are already commonly traded between consumers and suppliers on-line e. mobile phone). particular trade sub-areas in towns (one may think of Shinjuku in Tokyo with respect to electronics). user-friendliness (ease of access through PC. “Support for the euro among leading UK executives was confirmed today with the release of a B2B ebusiness survey showing more than 50% back entry to the single currency to aid UK participation in pan-European electronic trading exchanges. At the most fundamental level: "For the commercial exchange of goods to take place there are a number of prerequisites well-known in economic theory.” [Microsoft UK Press Centre – Nov. for the first several years of 21st century business to business commerce is predicted to be the driving before behind the development of ecommerce.

" [Luc Soete.com/ are redefining the art of sales and marketing by providing no-nonsense bottom-line information to consumers on price alone.ebay.is4profit. this highlights the economic fundamentals which will drive the digital economy. which is as potentially relevant to the Western Isles as it is to London. it is a global economic revolution. In the UK for example PC/Internet banking has been a new. A whole host of new financial services related to on-line share dealing.pricerunner. However. Such services are now even becoming increasingly available through consumer television sets.napster.B2B e-business is a priority issue for these UK organisations with almost two-thirds having an e-business director.com are also already widely established.asp and www. A significant element of this commerce seems likely to be derived not from the simple substitution of physical/traditional commerce with e-commerce or indeed m-commerce. low-cost electricity contracts.toobo. despite vast commercial interests in the traditional model. investment opportunity sites…etc are all challenging the traditional way that businesses interact with their customers and each other.qxl. Other new and innovative forms of exchange related to on-line auction sites (www.com or www.1jump. Business information portals for UK SMEs http://www.com ) and even on-line swapping sites demonstrating at the basic level the new ways people are finding to trade on-line.b2byellowpages." [California State Governor] " Others such as Napster ( www.uk/ and http://uk. In other instances price comparison sites such as http://www. from a vast range of competing sources.com/business_directory. In response the state announced it was going to hold an Internet auction to secure long-term.co. insurance comparison and arrangement sites. the process is more complex than it appears on the surface. mortgage applications. New forms of ‘adding value’ to more expensive products are thus being pursued by suppliers in an increasingly dynamic and growing marketplace. 74% having B2B e-business on the board agenda and 42% having a company-wide . Again. A recent high profile example of this method relates to the recent energy crisis which led to blackouts in California. So lets be very clear in recognising this current move towards the digital economy. a new way of doing business. Maastricht Economic Research Institute 1999]. Other b2b innovations include specific company and business research tools downloadable to the desktop such as that available from http://www. but instead centred around new forms and methods of trade and exchange. It is not a passing fad. “I expect these bids on long-term energy contracts should stabilise the market and drive the price of electricity down…This is a key step in our efforts keep the lights on in California at a reasonable price.com) are fundamentally changing traditional business models related to the distribution of music.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ become significantly reduced due to the ease of electronic access and the available databases on products and suppliers. “Microsoft questioned key executives from 400 major UK organisations on the progress and future impact of B2B e-business initiatives in the UK…. increasingly widespread and innovative development in the banking sector which has even spawned new businesses (and competition) in a sector where traditional barriers to entry have been high. betting.com/ .

rising to a predicted 90% by 2002.etc are all possible via on-line b2b. The following diagram highlights this situation in the US context: B BOX 32 The digital economy is thus a well acknowledged business trend. B2B is not limited by the number of consumers with PCs and the number of them that are on-line.. by the time they get geared-up for the new economy.3 trillion by 2003. “The extent to which B2B E-commerce represents the largest productivity tool for the economy over the coming 5-10 years cannot be underestimated. Theoretically. there is no aspect of a business’s activities that fall outwith the e-commerce b2b sector. a level approximately ten times that of b2c. staff development. travel bookings. From the purchasing of raw materials for the production process. to office supplies & electronic banking services. Indeed. Such figures need no explanation. B2B’s growth in comparison to b2c growth is thus going to be significantly higher. The business case for the .” [Sands Brothers & Co Ltd. it was estimated that during the year 2000 more than 50% of US businesses begun selling goods and services on-line. it thus seems clear that the areas that are both most appropriately geared-up and switched-on to the new digital economy will be the ones that reap the benefits in the long run. a revolution is happening. Referring back to the very first quotation in the opening lines of this section.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Forrester research estimated in December 1999 that b2b e-commerce was set to grow in the US from $108 billion in 1999 to $1. there is a danger that traditional economy businesses which have been slow to invest may see their market share disappear. so much so that it would be accurate to describe it as a structural change in business and commerce. With a sometimes quoted 1-2 year lead-in time for e-commerce enabled businesses. the bandwidth of their connection and then the number of them that feel confident enough to purchase over the internet. Investment Bankers ] Again. from the US a research study on purchasing staff in US companies found that 25% purchased on-line during 1999. the number that are on-line with unmetered access.

Many of the traditional barriers to entry into the wider market (i. has just announced funding of 98M from government and EU sources. costs of entry. Interestingly. Ireland. the gaining of market knowledge. particularly when combined with a common European currency. One does not have to look far for an example of such forward thinking. A strong emphasis has been placed on public-private partnerships. activities that are not part of the core manufacturing or service production of the firm can now be carried out more efficiently outside of the firm. e-commerce and ebusiness are: “…the most significant changes since the Industrial revolution.. distribution costs/export licenses. and also the deployment of innovative broadband solutions such as WLL and DSL in many rural areas with an inherently poor communications infrastructure. " . information on competitors…etc) will be negated and the opportunities for the periphery-based SME will be significantly increased.e. everywhere. The phenomenon of outsourcing is typical of such reorganisation.. For example: "Electronic exchange is likely to lead to a substantial reorganisation of markets with the value chain shifting across business. in specialised companies. where their future opportunities reside.5Gbits/sec fibre which is apparently already being rolled out on the ESB’s electricity infrastructure between Dublin and Limerick. president of the European Commission. as has been recommended within this study and initially 13 such projects were approved. squarely centred on the structural and cultural change necessary to attain success for the present and more importantly for the future generation. numerous e-commerce projects and initiatives. The expanding EU internal market would appear to be an ideal breeding ground for inclusive e-commerce development. A radical and focused approach to future development initiatives is therefore recommended. As witnessed in the rapid growth of business services.e. There would appear to be a unique opportunity for Europe's periphery to become more economically and indeed socially integrated into the new EU internal market and beyond. Maastricht Economic Research Institute 1999 The Western Isles’ economy must be able to up-skill and up-grade its communications network to be in the right position at the right time to exploit such opportunities. They are not just about technology.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Western Isles to invest heavily now to become part of this evolution to business revolution is hence self explanatory. matched by 220M from private sources to promote increased internet penetration for both social and commercial use and also to overcome particular region’s ‘communication deficit’. The ‘Celtic Tiger’ i. They will affect everyone. Managing this transformation represents one of the central economic and social challenges facing Europe today. Scotland. the ESB’s choice for its new network is 2. are farreaching and global." [Luc Soete. According to Romano Prodi. the Highlands & Islands and the Western Isles need to make equally bold moves if we are to compete and succeed in the Information Age. The project includes funding for a nationwide broadband telecoms network proposed by the Electricity Supply Board (ESB). There is little doubt in Europe’s fastest growing economy.

school. business and administration on-line ∫ Creating a digitally literate and entrepreneurial Europe .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The eEurope Initiative (to be discussed further in chapter 8) currently being promoted by the European Commission’s Information Society Directorate is thus aimed at: ∫ Bringing every citizen. home.

Again referring back to the opening paragraph of this section. Some good examples of the growth of e-business can be reviewed via the following portals which focus on growing SMEs online: http://www. Scotland.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ ∫ Ensuring a socially inclusive Information Society As a microcosm of Europe the Western Isles could do a lot worse than subscribing fully to such themes which will bring about not only a population integrated into the Information Age.uk/ http://www. Sweden and Ireland are two examples in which such themes and targets are being embraced. SMEs are going to need assistance to restructure their operations and realign themselves within the new economy.eubusiness.ecommercetimes. New ways of working will have to be adopted.bizmove.co.quicken.better-business.gov.uk/ http://www.be/Home/ecommerce_awareness.e-centre. the Highlands & Islands and the Western Isles all appear to be unclear in their future direction.com/ http://www.interforum. yet the clear indicator are there for all to see. it is within the SME sector that UK efforts in the e-business/e-commerce are currently focused.isi. .cch.org.com/ http://www.coms as being anything other than a blip are the ones who will lose their competitive advantage as we move incessantly towards the digital economy.com/ As we shall ascertain in the next chapter.uk/ http://www.com/ http://www. it is clear that the sceptics who question the demise of the dot.org/ http://www.htm http://www.cenorm.isss-awareness.com/small_business/ http://www. as key Information Age skills are not necessarily going to be present and therefore they must be able to adapt to survive. but also one which will be well placed to exploit new business and social opportunities.toolkit.

The adoption of new ways of working by both the SME and large business sector in not just the UK. It was identified that SMEs in the UK in particular should be a key target sector – "These companies need to be the focus of government. the Internet. to open up new market opportunities and enable even the smallest of companies to compete on a globally. . E-commerce: “…cuts across geographic boundaries and time zones to save time and costs. The incentives related to gaining a competitive advantage by reducing operational costs. now that we have established the magnitude of demand and opportunities related to the digital economy we now need to more clearly focus on such issues to help aid the anticipated development process. trade association and large company efforts to stimulate UK development towards the Information Society…As SMEs are so pivotal to the UK economy. Electronic commerce spans established processes such as bar code scanning and electronic data interchange (EDI) as well as newer arrivals. it may be that the route to achieving the Information Society will be through winning the hearts and minds of SME management. as indicated at the start of this section. In summary then.ecentre. streamlining business processes and improving communications with customers has led to the current e-commerce revolution.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The Spectrum Business and Consumer Surveys (1997) in support of the ISI ‘Moving into the Information Society’ publication showed that there was a large gap between the usage of ICT between large and small companies. but Europe also. the World Wide Web and mobile electronic commerce. Availability of the appropriate broadband technology has already been discussed as being one of the key pre-requisites.uk/] In short. in many instances." As a result of this analysis the ISI has been squarely focused on the SME sector in the UK and this is an area we will also consider in the following and final chapter of this report. This is what the final chapter of this report will focus upon. An appropriate skills base along with the supporting policy environment are also of key importance. e-commerce is not being progressed for any other reason than economics.org. will provide a range of potential key opportunities for the Western Isles economy. So. the outlined e-commerce revolution and move towards a digital economy has the potential to offer key opportunities which will be location independent. from a Western Isles location as from a London location.” [http://www. Given the anticipated and indeed required move towards new ways of working in the new economy. new business practices adopted by both SMEs and large business will both present outsourcing opportunities and enable new business models and entrepreneurial start-ups to operate as effectively. like e-mail.

ISBN 92-894-0042-0 EVANS. for DG Information Society. Summary Proceedings. IST Conference Helsinki 1999. ESRC Centre for Economic Learning and Social Evolution (ELSE) University College London. Amoreiras Torre 1. Building the Welsh Economy on Global Digital Infrastructures . Cardiff.Who are the Winners? IST Conference Helsinki 1999. eNetwork Infrastructure: Enabler of the Networked Economy. MEP. IST . Wales. Dave. Skills for the Information Age. 15º.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Chapter 7 References: ANDERSON CONSULTING. DG Information Society. New Rules of the Digital Economy . Portugal. CEN/ISSS.. Office for Official Publications of the European Communities. Christos. GATTI. BIRCH. Communications and Electronics Skills Strategy Group EURO – MED NET 98 Conference. Les.hyperion. (March 1998). Status Report on European Telework – New Methods of Work 1999. Luxembourg. How to Reap the Benefits of ECommerce . Office for Official Publications of the European Communities. (2000). IST Conference Helsinki 1999. Think Activity. Equity Research. Not Place . 36. DEPARTMENT FOR EDUCATION & EMPLOYMENT. Arthur Andersen SA. Rue de Stassart 1050 Brussels. IST Conference Helsinki 1999. Luxembourg. Managing Director. W. Value and Value Creation in the Digital Economy. (January 2000).. Role of Internet and the World Wide Web in Developing the Euro-Mediterranean Information Society. & Co (2000). EU Publication. European eCommerce. Policy Officer. IST 2000. Barbara. Belgium. HEIKKILÄ .uk. Business Services. BINMORE. © Hyperion Systems Limited http://www. BT Parkgate. Digita Oy.Flexible Working in Practice. CLARKE.IST Conference Helsinki 1999. Owen. MAARTEN & JOHNSTON.co. UK Information Technology. Ken.Pauli. ISBN 92-828-7960-7 CALTA. BOTTERMAN. (August 1999). The Internet Revolution: Telemedicine and Co-operative Environments. HAMBRECHT. FOLIAS. IST Conference Helsinki 1999. Trade and Technology as Global Drivers of Local Economies. The Generation Game: 3rd Generation Mobile is Coming: Time to Think About the 4th. Carol A. BT UK. Peter.R.IST Conference Helsinki 1999. 1070-101 Lisboa. Director.

Living and Learning in the Digital Archipelago. MERIT Maastricht Economic Research Institute on Innovation and Technology. Technology:Internet Commerce Report SHAPIRO. Towards a Mobile Information Society. 1 Arden Court. WALTERS. and ROADKNIGHT. Arden Road. Hanne. Sands Brothers Investment Research. (1997). The Vertical B2B Sector. DTI. (Sept. IST Conference Helsinki 1999.com (Aug. LOCATE IN SCOTLAND. England Ethical Issues in Healthcare Telematics. Change of Mindsets towards flexibility and entrepreneurship in the Information Society. Nokia Research Center. (1998). GOLDMAN. 00045 NOKIA GROUP. Ministry of Labour. (July 2000). Marya. UK OnLine for Business. 2000). Economics and Statistics Administration.robertwalters.nl/soete Towards the Digital Economy: Scenarios for Business IST Conference Helsinki 1999. Investment Bankers. Department of Enterprise. Hannele. Centre for Competence and IT.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ HIE. Governor . Martlesham Heath Ipswich IP5 3RE. P. ZALE. Online Finance Europe: Invasion of the Customer Snatchers. Call Centres in Scotland – Where the Accent is on Success. Moving into the Information Society. OF COMMERCE. Gavin (January 2000). INFORMATION SOCIETY INITIATIVE. (August 2000). Sand Brothers & Co Ltd. 8000 Aarhus C. (1995). IST Conference Helsinki 1999. (June 2000). Working Anywhere: Exploring Telework for Individuals and Organisations. Global versus local. IST Conference Helsinki 1999. MORGAN. WAGGONER. Alcester. 2000). The Business-To-Consumer E-Commerce Sector. HMSO. Chris. 2nd Edition. Danish Technological Institute. On-Line Network Economic Information. Dublin. Box 407. Clive CHKS Ltd. 29 Kongsvang Allé. Luc. James. (May 2000). Scottish Enterprise Publication. On-Line Report: YLÄ-JÄÄSKI. Ian W. Finland. Telework in Finland – Factors Behind Telework Use as Seen From an Employer Perspective. IST Conference Helsinki 1999. TRISTRAM. ROBERT www. SACHS. 2000) Falling Through the Net: Towards Digital Inclusion. Ireland . US DEPT. Adastral Park. IST Conference Helsinki 1999. Juha. Presentation of the Irish Initiative. John P. IST Conference Helsinki 1999. B2B – Just How Big is the Opportunity?. A New Approach to Active Network Management. Call Centres in the HIE Area. University of Maastricht Website: http://meritbbs.. (Oct. ISSN 0787-9393 . Denmark. Trade and Employment.O.. SOETE. David & Waggoner. KELLY. Equity Research POKKA. The Floating Islands Revisited . JP. James & Mlinar.unimaas. Salary Survey: UK and Ireland. B49 6HN. BT Labs. ZAMINDAR. MARSHALL. DTI Publication.

researcha.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ INTERNET SITES ACCESSED FOR RESEARCH PURPOSES: http://www.isi.com/ www.asp http://www.org.gov.asp http://www.sak.uk/ http://www.freelancers.eu.uk/index.org.tkk.e-skillsnto.ta-telearbeit.uk/ http://www.eto.com/business_directory.ispo.com/SPECIALS/2000/e.uta.be/ecommerce/Welcome.e-centre.html http://www.isi.com/small_business/ http://www.com/ http://www.e-centre.fsk.int/comm/dg13/index.com/ http://www.ilrt.dk/fsk/div/hearing/draft.uk/ http://www.htm http://www.ridgeway-sys.fi/telework/kirjall.cec.html http://www.com/eng/node85.onforte.toolkit.uk/mirrors/scout/ http://virtualsociety.work-global.com http://www.uk/ http://www.html http://europa.elance.htm http://www.fi/ http://www.com/ http://www.sitra.ecommercetimes.com http://www.europe/ http://www.interforum.teleport-brussels.de/tahtml/we_english/indexengl.cnn.uk/ .org.better-business.org.com/ www.cenorm.ac.uk/isi/ http://www.com/ http://www.uk/ http://www.org/ http://www.be/index.evosoft.de/English/english.uk/ http://www.bizmove.isss-awareness.fi/tietoyhteiskunta/english/st5/eng01.is4profit.1jump.net http://www.robertwalters.be/en/index.html http://www.forrester.be/en/frames.bris.utu.htm http://www.sbs.ac.com/ http://www.html http://www. http://www.cch.be/Home/ecommerce_awareness.com/ http://www.fi/telework/english/ http://www.co.com http://www.htm).com/ http://www.htm http://www.bredbandsbolaget.co.av-edge.eubusiness.ox.html http://www.quicken.bta.gov.freelanceinformer.b2byellowpages.html http://www.com http://www.

it needs to be reiterated that unless such skills and human resource development is undertaken across the board. In this context one can begin to identify the types of opportunity and the specific skills required by such an area as the Western Isles.gs. Areas such as the Western Isles must be ready with the appropriate ‘hard’ and ‘soft’ infrastructure required to meet such future needs. Again. If one gives the population first class communication links in the information age. What is clear is that there is going to be a deficit of 1. It is therefore the aim of this section to focus-in on the types of key skills that are being demanded. co-operation at all levels in the local area will be required to ensure access on the ‘learning ladder’ at the various points suited to our population." [Hanne Shapiro. In theory. if we are to ensure that universal social and economic inclusion is achieved. This deficit is already apparent. the new technology aspects of the Information Age will often be as relevant to the pre-school child as to the OAP. Again. The presumption made in this chapter will be that an all-encompassing vision of the Island’s future place in the Information Society will be shared throughout the community and that there is at some time in the not too distant future a clear commitment made to realigning our economy and associated resources e.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ http://www.html http://firstmonday. It may be the move towards .org/ Chapter 8 8 Skills Development / HRD in the Information Age Skills Development: An Introduction "Creativity combined with understanding the possibilities of ICTs and the ability to dream the unimaginable in new forms of partnerships. then in development terms the area could ask for little more. As such this deficit presents a key opportunity for rural areas in so far that it is this deficit that will force key businesses throughout the UK and Europe to investigate and adopt ‘new ways of working’ to address such problems. seem to be the sacred blessing when we look at qualifications and types of employees in demand.g. One is also then able to begin to identify how we might achieve the desired outcomes thought to be fundamental to survival and integration into the new economy. As the importance of this parallel initiative is recognised then key targets and milestones will need to be set across all sectors of the community. as mentioned earlier in this report. Danish Technological Institute .1999] The above quotation summarises the extent of the problem when one tries to identify with any authority the key skills and human resource requirements of the digital economy. the rollout of broadband will neither make sense nor be justified. unless such supporting development is secured and widely available to be accessed by the Western Isle’s population. people.com/hightech/research. coupled with the skills to utilise it to generate new activity and wealth. which if not addressed will seriously undermine the EU economy.7 million of employees across Europe by 2003.

Although many efforts are being made in a number of areas to address such issues. and continue to. Unlike many other UK industries a significant number of businesses in this sector have been. even if they are located at the other side of the Atlantic from their paymasters. 8. this has had little to do with performance and more to do with an initial over-valuation of stocks and subsequent adjustment.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ already developing opportunities for persons with the right skills in the new economy. Recruitment demand is still high as intimated above and forecast to significantly outstrip supply. experience double figure growth rates on an annual basis: BOX 33 GDP AND SOFTWARE & SERVICES COMPARED % Growth 18 16 14 12 10 8 6 4 2 0 -2 Software & Services GDP 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 Source: Office for National Statistics (1998 Est. "…although the flow of people from the education system with IT qualifications is rising. even through last year’s downturn in confidence in the ICT sector as a whole. for S&S sector) 1998 Year .1 Sector Specific ICT Up-Skilling Opportunities: A Discussion There are several key sectors that have continued to experience solid growth. a local response to the opportunities identified is essential if the area is to develop along the appropriate development path. Skills for the Information Age] The ICT & Electronics sector represents one of the most dynamic components of the UK economy and hence is a good place to start. Although some share prices may have fallen." [DfEE (January 2000). this will not in itself be enough to ensure that employers are able to recruit people with the combination of skills and aptitudes which they seek…Some skills mismatch is inevitable given the rapidity of technical change particularly in IT.

the overall trend in demand remains upwards. People are the key to the current and future prosperity of this sector. tying them in to return to the Island or company for a certain amount of time after graduation. excluding the software and systems development (and management) functions. In the IT Services sector _ of employees are likely to be managerial. the future of the Island’s development capability depends on achieving success in retaining potential youthful out-migrators and their associated ICT skills. Future entrepreneurial activity and ICT business start-ups are essential in the new economy. it would appear that the ideal employee in the high growth software & services sector in the 21st century will need quite a different range of skills that what one might first have imagined. The Information Technology. interpersonal skills on the basis that technical skills will be developed in employment. The associated development of a new business start-up venture capital fund by the public authorities may also help drive such development. During the 1990s in the UK. A collaborative approach by the public/private sector to employ this target market whilst sponsoring them to gain official qualifications could be a win-win situation. then offer an alternative day-release route through UHI or other provider and/or sponsor the most able after a two year period. then a more proactive approach to enticing school leavers through time into the local ICT sector would be desirable. prior to employment. as outlined above. However." This is a similar experience to what has been found in practice as the Western Isles ICT Advisory Service has sought out new teleworking jobs. In theory. at the Iomart Internet Service Centre in Stornoway it has been found that employees need not have a wideranging IT&Telecoms knowledge. Communications and Electronics Skills Strategy Group (ITCESSG) findings show that . Likewise. But a solid range of 'other life' skills has also proved important (i.e. Ultimately. professional and technician-level employees. Although this supply issue has now evened out. With regard to the latter. In the telecoms and electronic manufacturing sectors a significantly smaller number of employees fit into the above categories. the school leaver market would appear to be a largely untapped market in that particular instance. One of the key points highlighted by the DfEE’s ‘Skills for the Information Age’ report was that: "…many roles in IT services are suitable for people without deep technical skills at the point of recruitment. technological development and innovation. There would appear to be an opportunity to develop an IT Services+ qualification to address such issues. increasing global competition. the supply of such skilled personnel failed to keep pace with strong jobs growth in this sector and the result was high turnover. inter-personal skills) as has attitude and enthusiasm. It is the former sector that is likely to be of most relevance to development in the Western Isle's context. with many employers often most interested in transferable.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ This sector has been characterised by market expansion. one could ‘snag’ school leavers by the enticement of earning money to go towards the ever increasing cost of studying on the mainland. in many instances. being replaced by electrical and electronic engineers and production operator and assembly staff. many being accepted from other occupational groups. If the area is to progress. vacancies and a resultant pressure on salaries.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ recruitment problems in the ICT sector in the UK with associated salary inflation. Again this confirms previously quoted statistics and as a result there would appear to be a clear opportunity here for outsourcing to a highly skilled Western Isles labour force. Similar exercises by the Institute of Employment Research (IER .000) between 19982006. Recent estimates by the Labour Force Survey (LFS) still conclude that: "…insufficient numbers of students with the skills and knowledge required to work in the ITCE industries are emerging. On the other hand although the electronic sector is much more discerning on the technical content of the degree. IT businesses gravitate towards graduates. the possible entry of the UK into the Single European Currency and growth in the wider economy) that future employment growth rates in outsourcing and internet-related activity by/to IT technical specialists is likely to increase by over 40% (348.000) shortfall in supply of IT specialists and further calculated that if current (1998) levels of training investment remained static then this shortfall in supply Europe-wide would rise to 12% of total demand by 2002. communication and management abilities of its graduates. Such an assertion is illustrated by the low numbers of each entering the industry. as recent research by IBM Global Services has estimated (taking into account Y2K demand. The ITCESSG's findings also state that there is a specific demand for: "…people who combine up-to-date technical knowledge and problem solving ability with good communication skills and the capacity to 'understand other people's businesses'. particularly given that the supply of appropriately qualified staff is going to be in increasingly short supply in urban areas in particular. As a consequence . team-working. Again it would appear that there is an opportunity to develop an ICT+ qualification to address such issues. Capacity building in the technical field is still an opportunity nevertheless. This would appear to be a ripe market for teleworked outsourcing. even with non-technical specific degrees. it has been concerned about the problem-solving." There appears to be a perception that ICT industry jobs are too technical. " Such a finding is entirely consistent with the more widespread convergence of numerous business sectors in the Information Society. insular and impersonal and this does not appeal to either many young people or women.Warwick University) and Cambridge Econometrics predict similar demand. In summary then. on the supply-side the ITCESSG state that they "…do not expect the numbers of people with technical skills coming through the higher and further education routes to increase sufficiently over the next few years to meet the growth in demand. due to their perceived analytical and conceptual skills.5% (320. A further report by the International Data Corporation (IDC) in 1998 on a Europe-wide basis calculated that there was a 3. unless more able young people – and particularly women – can be encouraged to take up ITCE courses." Other findings from the ITCESSG study are also of note.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ if up-skilling is to be achieved within these two key groups then a parallel campaign of awareness-raising and education about the sector needs to take place. education and training institutions and Governments. Perhaps initially targeted at those persons available on the skills register. this initiative in addition to the above report. Siemens AG. the ladder for career progression and the qualifications and training required this forming the basis of their second recommendation. The main competencies mentioned in this instance are as follows: 1. 5. Philips Semiconductors. Thomson CSF.. Sponsors apart from the European Commission include IBM Europe. although this being clearly a national initiative. 2.” As such. 2. The report also recognises the need for a to National Information Systems Skills Framework – which describes the skills and key competencies required for different IT jobs. 3. 3. The on-line presence itself is aimed at a: “…project is to put in place a clear framework for students. 4. provides important pointers as to where investment in skills develop should be focused at the Western Isles level to specifically address the looming skills crisis. that describes the skills and competencies required by the ICT industry in Europe. In compiling the report six main skills were mentioned by the ICT sector as being critical: 1. Oral Communication Problem Solving Team-Working Improving your own Learning Business Awareness Creativity & Innovation There would appear to be a clear opportunity to link UHI degrees into such key competencies and a range of new tailor-made courses designed specifically for the ICT sector. 6.” A range of generic job profiles have been developed to both attract potential students and to: “. A recently developed website http://www. A parallel and on-going effort to attract more people into the industry via skills development may be necessary to add-value to a parallel development of broadband over a minimum of 5 years. The DfEE’s ‘Skills for the Information Age’ also recommended the on-going importance related to the gathering and forecasting of demand and supply within the ICT industry. and British Telecommunications Plc. People who are Creative and artistic People who are excited by technology People who have a liking for science and mathematics People who good communications skills People who like dealing with people . 5. 4.career-space.com/ demonstrates how seriously the industry is addressing the projected skills shortage. A complementary campaign to encourage business outsourcing to the Islands skills base of teleworkers could then be a logical next step.provide higher education ICT curriculum designers with clear up-to-date and easily accessible information on the skills needed by the industry. Nokia Telecommunications. and assist Governments in developing policies to foster the growth of ICT skills in Europe. Microsoft Europe.

There does not appear to be an overall visionary strategy that each ‘segment’ of the market has enthusiastically signed up to. The project was completed in March 2000 and is of direct relevance to this study. Much of the project was based on looking at employability skills now and in the future and involving employers. industry and the educational institutions to address the skills shortage and to establish: A New Partnership to Close Europe's Information and Communications Technology Skills Gap.000 persons within the UK alone and targeted its initiative at not only attracting more students and young people into the industry. Both students and employers identified skills awareness and work experience as being two of the most valuable activities that could be undertaken. The six key skills required by any graduate were identified by the three main interest groups involved in producing the report: . These recommendations are included in Appendix 7. aimed squarely at filling the skills gap. the report identified a skills gap of 40. rather then just IT skills. effective and concerted action by the European Commission. at the local Western Isles level. oral communications and business awareness as being the keys skills they were looking for in graduates.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ To date there have been 13 generic job profiles in various sub-sectors with a full range of supporting information provided. as they did not necessarily require ICT skills at the point of entry. The project itself and resulting advisory booklet: “Have you got what IT takes?” won the top prize in the category ‘Best Higher Education Careers Literature’ and as such is also a credible piece of work. the e-business NTO undertook an initiative called Project Gemini that brought Higher Education and industry together to consider and promote career opportunities in the ‘IT Services’ industry. the significant majority of respondents from the SME and large business sector stated that they are quite happy to recruit non-IT graduates. The 'ICT Consortium' calls A recent amalgamation of the ‘e-business’ National Training Organisation (NTO) with the ‘Information Technology’ NTO to make the ‘e-skills’ NTO demonstrates the increased convergence related to doing business and being integrated into the ICT sector. educators and students to help the changing of perceptions on all sides with regard to what each other was/is doing. Project Gemini had the following aims: • • • Improve the availability of graduates to the IT Services and related industries To bridge the gap between the skills needs of industry and undergraduate skills development Improve linkages between employers and educationalists At the time of writing. This lack of communications/understanding is arguably.” “…requires quick cost-effective responses. Indeed. A comprehensive set of recommendations has been formulated which require careful consideration if key opportunities are to be exploited. the study found that businesses in the ICT sector identified problem-solving. apparent in the Highlands & Islands context and again arguably. the Member States. Prior to amalgamation. NTOs are accredited by government as being the ‘voice’ of the industries for which they represent. recognising many of the transferable skills available. This new strategy therefore for immediate. Interestingly. but also targeting graduates with non-IT specific skills into the sector.

Such degrees need to be ‘21st century’ enabled and address key developing market requirements. if we are clear about looking to and addressing the future skills requirements of industry in the Highlands & Islands and beyond. Other key areas identified in this research relate to the importance of work experience and a second EU language. Ultimately. Where previously the IT Services sector was considered to be a career path closed to such students for a range of reasons which were largely misconceptions. there are core skills that must be developed to support the development of e-commerce and ICT related industries. the awareness-raising effect among groups of students from the ‘arts & humanities’ faculties broadens their employability significantly. One would have to look to UHI in such a context to increasingly work and consult with the IT sector within and beyond the Highlands & Islands to build and integrate such core competencies into its new degree programmes. than standard degrees from traditional Universities. once recognised. As can be quite clearly explicated from the three separate skills development initiatives discussed above. UHI degrees need to offer something more to employers in the Highland’s and UK’s fastest growing industry (which is suffering from an increasing skills shortage).Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ • • • • • Teamworking Problem Solving Improved Learning Business Awareness Creativity and innovation BOX 34 As Box 34 demonstrates. UHI arguably. therefore needs to work closely with the IT sector along the lines of the Gemini project in South East England and market itself and build its reputation upon producing such graduates. It is after all marketing itself as being a technically innovative educational delivery establishment and has an opportunity to produce graduates that will be sought after by an industry that has been involved in agreeing and approving the key competency strands . A common misconception among students and educators is that such industries are looking to employ ‘techies’ but this is not necessarily the case as there other more important skills of the nature mentioned in the above discussions. it is a legitimate aspiration from a whole range of disciplines.

AS Manager. 2000] . 2000]. team working.2 ICT Skills Development Opportunities In addition to addressing core generic competencies there are also key technical skills areas that are relatively straightforward to identify by considering industry trends and more specifically developing industry demand. Could there be an opportunity to complement the Highlands & Islands Learning Grid proposal with broadband telecoms being delivered to rural ‘outreach’ centres to that of one providing key advanced rural ICT workspace infrastructure to address future potential demand? Obviously such an initiative would include a certain amount of risk. 2000] Again. Returning to the key areas of developing demand for technical skills there are several areas of obvious demand. by 2003 there is going to be an anticipated 1 million e-business related positions shortfall [Internet Magazine.4.3 and 6. Sourcethatjob. On the other hand such key infrastructure may open up a multitude of opportunities to plug at least a small part of Europe’s developing skills gap. MD of internet recruitment site CareerPlus has identified one of the key opportunities in his experience: “The demand for web skills has never been higher and there’s simply not enough trained technical staff to go around…the message is clear – get a smattering of Internet knowledge under your belt. although not marketed) core internet skills of the nature demand by industry. and you’ll become a very valuable commodity over the next few years. to an increased level of outsourcing – refer to sections 6.” [Dec. 8. Dec. so evidence of work placements is highly regarded. In rural development theory ‘best practice’ relates to the integration of skills development with that of developing industry opportunities in rural areas. particularly in the technical skills context. “For web developers…for the commercial side. given the location independence of much of this work.com. Richard Bowery. Existing structures in the Western Isles such as the Lasair teleworking model may directly benefit or such workflows may also target the call centre model at varying scales.” [Richard Jones. One could anticipate that this unsatisfied demand will lend itself. within UHI and its degree delivery there is an additional opportunity here to ensure that even students on non-ICT degrees have (and this is already happening to some extent. There is a clear parallel opportunity here to build up key technical skills within the community of the Western Isles for example which will provide opportunities for new business start-ups to address developing market skills shortages in the UK and Europe. but needs to be developed further via on-going consultations with industry. As outlined in the introduction to section 6. Such advance e-business centres integrated with UHI outreach centres may be totally complementary and potentially an innovative added-value development model.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ problem solving. as all advance infrastructure does. Dec. The UHI initiative at introducing PPCs linked to degree programmes is very much compatible with such thinking. work experience…etc. On actual ICT degrees evidence of work experience in the web development field is considered essential by many within the industry. It may also be the catalyst to ‘kickstart’ the proposed H&I’s Learning Grid. experience matters more than qualifications.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Overall, and somewhat surprisingly, skilled ‘web developers’ are said to be one of the rarest commodities in the market, presently commanding major salaries and bonuses across UK industry. An outsourcing business opportunity must surely reside here and therefore a potential drive towards plugging such a skills gap via new skills training has the potential to create new employment in an area such as the Western Isles.

However, even such a clearly technically focused area of skills development (web-based) requires an added value element too. According to Adam Gunnell, founder of recruitment site Boldly-go.com: “The single most valuable skill a techie could learn to augment their value in the market place would be customer-facing skills and commercial acumen. These are the skills that will outlive any development tool of the day. A lack of these interpersonal skills is the most common reason for companies not proceeding to offer.” As with the generic skills mentioned in section 7.1, there is even a need for similar skills on the technical skills development course. This is an important point and one that if acted upon appropriately could give ICT-sector graduates from the UHI a competitive advantage in the IT-services supply market. This sector is also an increasing focus of the UK government as well as the European Commission, as mentioned earlier. Employment Minister Tessa Jowell has recently stated that the UK government will be increasingly focusing on improving IT skills, The UK government’s Skills Task Force estimates that at least half a million further IT workers will be needed over the next ten years. In this sense it will be imperative to raise the profile of outsourcing to rural areas as a key policy not only in practical terms but also in regional development terms. Given the focus, a clearly targeted strategy should be able to attract substantial development funding, in light of the wide range of indicators which identify the clear needs with the developing e-business sector. So where might an IT skills development focus concentrate? When we are talking about web development / programming skills we are talking about Java and C++ the object orientated programming languages, these two in particular being considered to be ‘the most sought after’ according to the Robert Walters Salary Survey report in August 2000. In addition, the need for ‘good’ database skills was also stated as being an increasing requirement within the industry. Additional key skills requirements, according to the same survey, for web development include Flash, Dreamweaver, Javascript, Cold Fusion and Active Server Pages in particular. The outlook for such skills is considered to be strong as competition in the e-business market across the UK and Europe intensifies. On the networking side the recent CISCO academy based at the LCC UHI campus should be a key opportunity to increase the level of Information Age networking skills in the area. Demand within the e-business sector for individuals with ‘security’ skills is anticipated to be increasingly strong as is that for individuals able to support ‘routers, gateways and hubs. Other key skills in demand from a survey of the ‘e-lance’ and other recruitment sites include Photoshop, SQL Server Programming skills, Perl Programmers, HTML and Oracle. According to the most recent labour force survey by NTC Research: “.. Java,

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ designers are still in short supply. Permanent skills most advertised for included Java and C++ programmers, software design engineers and telecoms engineers.”

In summary, there is a clearly identifiable range of skills demanded in UK industry and commerce in particular aspects of IT and Communications. Perhaps the most significant challenge is in identifying the key areas of future demand. There is always the concern that by the time any strategy up-skills potential employees in the industry, that the industry will have moved-on to the next generation of products, requiring new specific skills. However, in this particular area, one can be relatively confident that such a skills base built up will lead to the type of employees who in their particular industry will have to continually update their skills in any case, as skills in programming languages make the transition to other a relatively painless experience. Some UK firms for example have been employing C++ programmers instead of Java programmers, on the basis that for such persons, learning Java should only take several weeks, given that Java programmers are so difficult to employ at present. There is clearly a bottleneck within the supply of the UK and European IT & Telecoms workforce which is predicted to continue and thus presents, as mentioned in section 6.4 and 7, a real opportunity for rural economies to integrate into the Information Society by providing out-sourcing services to the fastest growing sector in the UK economy. “The IT skills shortage is at its highest ever level and shows no sign of abating despite the recent staff cuts at tech firms, according to research out today. The news comes from UK bank LloydsTSB, who has been conducting a survey into staffing levels for the last eight years. The findings show 56 per cent of firms have difficulty recruiting skilled business and IT services staff. This compares to just one in five companies reporting recruitment difficulties in the early nineties.” [http://www.computerpeople.co.uk/]

BOX 35

Source: UK Employers Skills Survey / Skills Taskforce Publication, DfEE 2000

As Box 35 clearly shows, previous research has demonstrated the negative consequences for the economy should skills constraints remain. Decreasing output and resulting

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ addressed, with periods of boom and bust as continual readjustments are made in response to supply-side friction – i.e. skills related issues.

8.3

Western Isles Skills Development in the Information Age: Summary
What has been discussed in both chapters 6 and 7 of this report has been the move towards what is termed the Information Age, the opportunities this presents and areas of demand for specific teaching and learning strategies. As indicated in the introduction to chapter 7 the achievement of broadband will require a complementary and indeed advance up-skilling of the Western Isles skills base. If achieved and the clear opportunities for employment and income targeted, then the development and integration of the area’s economy into the Information Age will be secured. To achieve this it seems clear that there is a need for at least two separate up-skilling initiatives, one focused on generic ‘graduate’ skills of relevance to the IT industry and the other focused on the appropriate mix of IT skills for industry. It will need to be accepted that this later initiative will require to be on-going and adaptive to the needs of the sector. There is clearly a yet largely unrealised remit for the University of the Highlands & Islands in particular. At the same time there needs to be an increasing involvement by industry and commerce in the up-skilling process, both advisory and financial. The latter in recognition of the new key role in the development process that the teaching & learning sector can address in the future – i.e. the supply of appropriately skilled staff. If not realised, then industry will ultimately be the one that suffer the consequences as chronic skills shortages occur. According to ‘Skills in the Information Age’ – DfEE, there are too few examples of Higher Education and industry colluding within the UK, although there are numerous examples in the US where such practice has developed and shown to be very much mutually beneficial. The University of East London and its collaboration with a local company, Logica, was highlighted as an example of best practice in the UK where response times to the needs of the company are short via the delivery of innovative ‘just in time’ course run on demand. In addition, the University of Sheffield and its usage of students to address real ‘businessneed’ projects have benefited both students and local industry alike. There are elements of both of the above that could be transferable to the rural Scotland situation. "Some businesses pointed out that the willingness of education institutions to work with them varied enormously. It was reported that the newer universities and colleges were likely to be more receptive." [Skills in the Information Age’ – DfEE, 2000] Such collaborations are of significant importance for both industry and education sectors – the students get the insight and the employers get students that are 'work-ready' – The

The private sector by its very nature is not able to invest heavily in taking staff on without the key skills and training them. Higher Education Reach Out to Business and Communities Fund. The evidence for the magnitude of change in society and the economy brought about by the ICT revolution is comparable to anything experienced since the beginning of the 20th century. As in the Broadband section. but rather consolidatory funding to maintain what it has. there is no escaping the need to pull the area’s resources by forming an inclusive partnership with local. If not achieved a key opportunity will be lost. there needs to be a clear recognition of the role in our economy’s structural change of the teaching.e. if the Western Isles area is to take its chance and be an early entrant into the new digital economy. new ways of thinking. education/training sector. new concepts of the workplace and organisational structures are all potentially achievements requiring to happen in a very short space of time. on-board. similar to industry and commerce. Increased collaboration between IT suppliers and HE institutions sought to enable access to equipment and practices. for fear of losing them to competitors after investing much. if a responsive and continually developing skills sector is to be achieved in the Western Isles. regional and even national interests represented. the development need required to progress the skills initiatives outlined can be achieved. but will take a ‘leap of faith’ by some and perhaps never sit comfortably with others. as this current opportunity presents itself. a paradigm shift. it requires bold steps and new sense of purpose to turn around the fortunes of the Islands. The dual goals of both hard (broadband) and soft (skills development) infrastructure development in the Western Isles context are achievable. In effect. learning and training efforts by both UHI and other existing or potential private sector market entrants. Business involvement in Course Content. For the ‘development’ agencies. Failure . if such a partnership can be formed with all the stakeholders i. the business sector and the public agencies. So. Innovation. The education sector does not receive development funding per say. whilst public sector agencies with a development remit have only limited funds to make a difference. then clearly some new innovative partnership initiative is going to be required to aid the area’s transition into the Information Age. As such.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Dearing report "Higher Education in the Learning Society" strongly supports such developments in its recommendations: • • • • Integrated Internet/Video on Demand – Education Opportunities. A teaching & learning sector in the Western Isles that is adaptive to the dynamism of the ICT sector and able to supply the skills demands of industry will need on-going development assistance both advisory and financial.

“The combination of digital information with communications technology will be as powerful a force of transformation in our society as the invention of the wheel or the industrial revolution in their time…At this time. whilst also elaborating on the potential opportunities and consequentially recommended. the optimisation of skills and telecommunications at the local level.. specific EU policy measures for ICT and the Information Society. Managing this transformation represents one of the central economic and social challenges facing Europe today. as a remote area on the periphery of Europe develop a sense of purpose with key development goals. They will affect everyone. Under the IS DG’s eEurope initiative the focus of the move towards the Information Society is clear: “These changes. One must be clear though that what is being suggested is not the imposition of a ‘top-down’ approach. In this respect there is a multi-level strategic framework being developed working towards the development goal of integrating Scotland and the Highlands & Islands (and the Western Isles) fully into the Information Society. everywhere. It is also a stated aim of Sweden in its Presidency role in the first half of 2001 to drive the policies aimed at IS convergence throughout the Community.. for the first time. in effect its findings. This report identified the challenges presented by the impending ‘European ICT revolution’ [Smith. the most significant since the Industrial revolution. hence the rationale for this particular study.4. the Council of Ministers. validating. 8. in Lisbon in March 2000 formulated a more focused policy direction. It was the ‘Bangemann’ report of 1994 that really provided the catalyst for the modern day European policy context. there is a clear feeling that we. particularly through the recently formed Information Society Directorate General (DG). 1997]. then. Rather than sitting back and seeing what happens. ” [Extract from minister’s speech on Digital Scotland. They are not just about technology. comprised of the heads of state from the member countries.” [Romano Prodi. As we will see in the following section contemporary development policy is totally attuned to the finding and recommendations expressed in this report. but rather that of an enabling approach so as to allow and encourage innovation and enterprise to flourish by priming the key infrastructural conditions necessary for bottom-up private sector development to become established – i. Scottish Parliament] 8.1 EU Policy for the Information Society Firstly. there is a need for Scotland to embrace with enthusiasm the opportunities and possibilities that arise from the digital communications technologies. In the current European context the European Commission has been driving the policies of the new Europe. it is worth considering EU policy on development issues related to the information age. are far-reaching and global. How such policies will eventually manifest themselves in the Western Isles context is not yet clear. More recently at the highest level. regional and local strategies.e. President of the European Commission] .4 ICT Skills Development: A Policy Overview The policy context for the type of developments identified throughout this report has a solid foundation in existing UK national.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ with lasting implications for economic and social inclusion in the new information society of the 21st century for both the current and future generation.

Community Programmes and even collaborate closely with the European Investment Bank where necessary. eLearning then. adding to that being formulated throughout the member states.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The initiative itself is said to be of major importance to aid the decision-makers and policy makers of the early 21st century rise to the challenges they must face and seize the opportunities presented. A view very much shared by the writer in considering the Western Isles context. business and administration on-line Creating a digitally literate and entrepreneurial Europe Ensuring a socially inclusive Information Society Clearly the adoption of such objectives has far reaching consequences for remote rural areas such as the Western Isles. This generic level strategy has also been converted into clear actions via the Council of Europe at the Lisbon Summit.” The message here is as clear for the Western Isles as it is for elsewhere. In the digital age. It presents a major opportunity for the Western Isles to access the resources required by it. home. A new. The term eLearning specifically came into being and referred directly to actions aimed at intensifying and mobilising the education and industry sectors in Europe. languages and technical skills . it is about: • • • • Substantially increasing investment per capita in human resources Providing each and every member of society with the skills necessary to work and live in the Information Society Training teachers and educators in the use of the internet society and its associated tools Decentralising training in key areas of knowledge. in many ways being compatible with the recent University for Industry’s ‘learndirect’ initiative in the UK context. to thrive and prosper in the Information Society. it is key to ensure life-long learning for new generations of creators. circumstance or location. researchers and entrepreneurs. vocational training organisations. Going further. All citizens must be able to play an active role in the Information Society. It needs to include potential entry at all ‘rungs’ on the ladder. The actions themselves specified that all schools in Europe must have an internet connection by the end of 2001 and by the end of 2002 to have gone a stage further and provided ‘fast’ internet connections and multi-media enabled classrooms at pre-specified user to PC ratios. on-going and inclusive IS skills development is required for all members of society whatever their age. learning centres. is the term used for the Council of Ministers’ strategic directions and associated actions. school. It must be remembered that our baseline is that much lower than many other communities in Scotland and indeed Europe and therefore a disproportionate level of investment is likely to be required. Within the eEurope initiative there are stated to be three guiding objectives: • • • Bringing every citizen. if the opportunity is to be seized there can be no shying away from the high profile initiative required. Yet. Within the context of teaching and learning. such actions also incorporate higher education and research. the focus of this particular section of the report the above strategy prioritises education and skills development: “Education is vital for the economic and social progress and for guaranteeing equal opportunities in our society. In summary. public libraries…etc. To achieve such veritable goals and actions Member states have been directly encouraged to utilise EU Structural Funds.

At the micro-scale (i. includes an objective aiming to promote “…the availability of widespread access to higher bandwidth services and bring together public and private sector stakeholders to develop a practical broadband strategy” thus being of direct relevance to the earlier chapters in this report…the policy framework and .career-space. As a nation.eu.2 UK National Policy for the Information Society So what particular initiatives can we point to at the UK level to justify a Western Isles initiative aimed at both broadband and e-skills? Similar to the European level context the UK national policy context is both supportive from the highest levels of government and quite specific with its message. encouragingly.int/en/) from Helsinki and Nice have been invaluable reading in convincing oneself of the major efforts being undertaken at the European level to guide and mobilise our society’s transition by addressing such key issues as broadband and e-skills or eLearning. technological development and demonstration (RTD) activities for the period 1998-2002 to aid the transition into the Information Society. A particular focus has been given to the promotion of e-commerce and assistance to the SME sector.cec. We have already looked at examples of best practice from the Member States and case studies such as that recently invested in by the European Commission and European industry at www. to its ‘A New Future for Communications’. Moreover.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ • Providing school leavers ‘broad digital literacy’ by the end of 2003 The adoption of such guiding principles and objectives requires the level of infrastructural changes discussed throughout this report. the Western Isles) similar arguments apply and require to be voiced equally loud.4. there can be no doubting the level of commitment within EU policy and funding to support initiatives of the types mentioned briefly within this report. businesses and education sector to become part of the ‘on-line’ Information Society. legitimacy and all-encompassing nature of the policy and action context outlined above. the EU’s Fifth Framework Programme (FP5) has identified complementary priorities for the European Union's research. In summary. to the DTI’s ‘Competitiveness in the Knowledge Driven Economy’ to its ‘Approaching Convergence in the Information Age’ policy paper on the changing regulatory framework. ensure that citizens and consumers are safeguarded. the UK must move quickly to enable its citizens. …this latter paper even. 8. One cannot help be concerned about the lack of strategic direction at the Islands’ level given the strength. ensure universal access to a choice of diverse services of the highest quality.com. in recognition of both the opportunities available and the costs associated with being a ‘follower’ rather than a ‘leader’. to its ‘Communications White Paper’ which outlines its intention to: • • • make the UK home to the most dynamic and competitive communications and media market in the world. The Information Society Technologies (IST) Programme is part of this research and development programme and the recent reports ( available from: http://istevent.e. From the Government’s ‘Our Information Age’ policy statement on its vision for future development.

Internet Learning Access Points Developing People’s Skills to Exploit new Technologies (£700M for infrastructure + £230M for improving ICT Skills Levels – CLCs. it considers how to expand and develop industry and education liaisons regarding current and future skills issues and it also finally attempts to strengthen the sectoral skills/training bodies such as the NTOs in the up-skilling process. Ufi’s Learndirect.‘UK On-Line for Business’ initiative. Life Long Learning and Individual Learning Accounts) Reducing Barriers to Use – Consumer/Security Issues. Already referred to in several instances throughout the report is the Department for Education and Employment’s ‘Skills for Information Age’ report by the ITCE Skills Strategy Group which quite provides a framework upon which to base ‘new economy’ skills strategy. on-line ‘eCommerce Resource Centre’ and a ‘Showcasing Programme’. in browsing the above content. join and converge or wait and become peripheral. it considers how to attract more people into the industry (including electronics) and retain the more able in face of EU-wide skills shortages. All in all. Free Publications on-line for SMEs. This particular element of policy is itself consistent with the EU proposals mentioned earlier on eLearning strategies. ‘Technology Means Business’ scheme. The NGfL is also targeted at providers from community organisations and libraries. ‘Supply Chain’ promotional initiative. one gets the clear message originating from the highest levels of government – i. Libraries. NGfL.e. . right through the spectrum of providers to the private sector.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Other equally important policy and strategy related initiatives relate to the ‘UK On-Line’ initiative funded and driven by government in recognition of the vast changes taking place in the way that work. further education. partnership initiatives between education. It is aimed at schools. communicate and lead our lives.g. although recognising the pace of changing requirements within the sector. right through society in the UK. The report recognising the immediacy of skills needs is about how to “…translate words into action and quickly. other agency and private sector aimed at both ‘generic’ skills demanded within industry and specific ICT areas of demand. Yet another element of specific policy interest is the NGfL. Community ICT Learning Centres. higher education and targets the access of ‘life long learning’ and ‘career development’ via on-line content. In 1998 the UK government committed itself to providing a National Grid for Learning (NGfL).” The report itself addresses how to meet current and future ICT skills needs. The related e-Envoy website specifically addresses the need for skills development in its ‘Confident People’ policy context outlining 5 key priorities and principles for adoption in the UK: • • • • • Access for Everyone (£35M) – 6000 UK On-Line Centres. the consistent themes running through this report have been recognised and are clearly in line with the strategies and policies outlined in this report with regard to the Western Isles context e. The strategy is based around the provision of a national learning resource available universally on the internet. now incorporated within its ‘UK On-Line’ initiative. Safety/Standards Issues Driving Up the Quality of Social Content – Local Content Successful Business . This level and range of actions demonstrates a clear commitment at the national level to see through expensive transitional strategies for the Information Age. Again.

have been the result and as we have already seen much of its policy findings/proposals are of relevance to the future policies of ICT skills development in the Western Isles. The winners and losers in e-business will be determined by access to skills… IT literacy is rapidly becoming as fundamental to employability as reading and writing.ngfl. pervasive. software and networks. Constraint in the growth of the UK’s IT industry is almost entirely due to professional skills shortages. social inclusion and sustainability and the need to control costs for contributors to the ‘Grid’. in the national policy context with regard to skills development in the Information Age one can look at the policy of the National Training Organisations. Finally.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Approved centres are to be set-up and connected via ‘high-speed’ internet access to this national grid and substantial funding is available to meet the requirements of accessing the grid from infrastructure to teaching and learning development projects and initiatives. are an example of such ‘opportunistic’ and integrated strategy formulation. but that it also may provide an opportunity for the added-value skills provision outlined as being of immediate strategic need for the Western Isles in this report.gov. For the UK to remain a world power in the information age.uk/about/detail. One can therefore conclude that not only is the NGfL an important national initiative for the rural as well as urban context. The three main area’s of the eskills NTO remit are as follows: • • • to represent the IT industry sector to address cross-sectoral IT professionals skills needs to improve the general IT user skills of the entire workforce. whilst also being a contributor to the funding of targeted ‘broadband’ infrastructure for both schools and communities in rural areas such as the Western Isles. demonstrating the firm belief that future skills training for business in ICT will be firmly routed in e-commerce and related activities.as the voice of employers with regards to education. Of recent and notable interest was the recent amalgamation of the e-business-NTO with the IT-NTO. The national e-skills NTO. This strategy and its rationale is entirely consistent with the skills development projects and strategies outlined for the Western Isles in this report: “The UK’s prosperity depends as never before on IT skills.. “ [http://www. training. referred to earlier in the text. The NTO is recognised by government “.html#ngfl] The ‘Grid’ itself will integrate the public library network and the UfI’s ‘learndirect’ needs and requirements. as well as for training in the use of information and communications technology (ICT) in the educational context. to be discussed below. The recent Highlands & Islands Learning Grid proposals. In the planning of the provision of ‘Grid’ access to schools there is recognition of extended needs of community.” To conclude this section on National policies. as business processes and the internet become increasingly integrated and possibly indistinguishable. qualifications and competitiveness issues for IT users and professionals….” and is currently in the process of producing a national strategy for eskills development in the UK. access. one must also recognise the complementary . “The NGfL includes extra funding for hardware. structural change is essential in the supply of ITrelated skills.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ to respond to broadband demand by releasing broadband fixed wireless spectrum and auctioning 3G spectrum. inclusive. the implication being that there will not be a ‘fast-track’ for urban Scotland to the disadvantage of rural Scotland. with key themes being amongst others being collaboration and speed. there are several main initiatives of high profile that provide one with much of the information relevant to Scotland’s response to the Information Society.uk/) run by the Government’s ‘Cabinet Office’ and the Central Computer and Telecommunications Agency (CCTA) in the UK provides an on-line database of projects and initiatives related to how the UK is responding to the Information Society and as such aims to provide a quality information resource for knowledge. open and modern Scotland where full employment is achieved. This. but rather a single and all-encompassing ‘Digital-Age’ development effort. is the ‘Digital Scotland’ Task Force report and related policy recommendations. business sand consumer demands and aspirations. Again this strategy’s framework is consistent with the aims and objectives of the actions outlined in this paper. being in line with the view taken within this current report. The report displays very clearly the belief in the coming of the ‘Digital Age’ and Scotland’s immediate need to be included at all levels and in all locations. information and learning with regard to aiding the UK’s efforts in areas such as teaching and learning and the provision of broadband. Secondly it highlights the need for new strategies for teaching and learning and new modes of delivery to ensure that Scotland is not constrained by skills shortages in its transition and integration into being a key player in the ‘Digital Age’ within Europe.3 Scottish and Regional Policy for Information Society Firstly. Encouragingly. the report highlights the need for SMEs to the potential economic advantage of the opportunities presented by ICT. the report also highlights the need for such technology to enable social and economic inclusion. one has to be less than enthusiastic by the level of response from OFTEL in response to government. Specifically. Of most importance.org. irrespective of location or circumstance. On the other hand. Action at both the Scottish and local level is identified as being an essential pre-requisite for Scotland as a nation. The current ‘revolution’ in our society and economy is said to be comparable with the agricultural and industrial revolutions that have proceeded it. arguably. A Scotland which achieves economic growth rates ahead of the . With regard to the vision identified there is once more an unequivocal belief that ICT development needs to become a much more significant element of the traditional development process within Scotland: “Our vision is for a prosperous. Furthermore the National Inventory Project (http://www.information-society. as indicated at the start of this report.4. 8. at the Scottish level.

’ This surely translates into a combined regional broadband and ICT skills development initiative in the Western Isles. in examining the Highlands & Islands Special Programme across all three ‘Priorities’ and within the related ‘Measures’ and their objectives and scope. highly-skilled workforce…A vision also of a Scotland where many people choose to work in rural areas where they can combine an excellent physical environment with opportunities for knowledge work. via the Enterprise & Lifelong Learning Committee are also of consequence. any development strategy or initiative which will not just stem population decline but most likely reverse it must surely maximise the priority for the funding available. Secondly. it is recognised that there is an enormous potential opportunity for the use of ICT to open up new market and opportunities for existing businesses in the Highlands & Islands and this will require both ‘soft’ and ‘hard’ infrastructure. A Scotland where no-one is excluded from education and training opportunities or from access to public services because of where they live. Scotland are also complementary and of direct relevance and other discussions and debate (‘Skills for Scotland’) in the Scottish Parliament e. It is recognised though.g. If we examine development policy for the Highlands & Islands specifically one can also identify numerous policies that actively encourage and support the range of actions outlined within this report. there appears to be widespread synergy with the related actions and vision outlined within this report. Recent initiatives have seen the contracting of a major UK ICT consultancy firm to examine the demand for broadband in the Highlands & Islands. Broadband provision to the Information Society (a fundamental requirement) and related skills development are aimed at maximising rather than just improving regional competitiveness. HIE and it's LECs are committed to the development of e-commerce and now have a dedicated website http://www. . whilst also dealing directly with social & economic inclusion issues on Europe and Scotland’s periphery. providing it takes a long-term perspective on the development process to achieve sustainability. or their social or ethical backgrounds.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ which are at home in the e-economy. from the Highlands & Islands Enterprise (and WIE) perspective a focus on broadband telecoms and ICT skills development are already clearly articulated goals.com/ which is targeted at the development of SMEs throughout the region.hiecommerce. as no other such strategy in recent memory has achieved the outcomes achievable by the implementation of the policies and actions in this report. Essentially. Again the policy context at the Scottish level can be seen to be entirely consistent with the findings and actions outlined within this report and indeed supportive given already defined commitments on providing the ‘right skills’ and a ‘world-class telecommunications infrastructure’ with ‘pervasive and affordable access for all to the web and other digital technologies. As mentioned at the national policy level.” At the micro-level such policy and vision is of the nature of that already outlined within this report and indeed was behind the rationale of the commissioning of this report in December 1999. Firstly. and a well-educated. Fundamentally. This report should prove complementary to this report. Scottish regional versions of the University for Industry (SufI) and Learndirect. well-trained.

Clearly for teaching purposes in response to demand for bandwidth. with a further rollout/upgrade of outreach centres off the main learning grid being increasingly prioritised. Cisco Systems 2000] UHI describes itself as an organisation “founded by the community for the community” and as such is committed to expanding its reach. “The amount of bandwidth required for video conferencing will depend on the quality required as well as the number of streams. Finally. Unfortunately such centres have only 128kbps bandwidth. In addition.” This focus being aimed at targeting opportunities related to inward investment. indeed perhaps via 24/7 availability. next generation IP/VC systems which reduce costs and offer improved quality will require 2Mbps and upwards for the near TV quality systems required for VC teaching. indeed perhaps more convenient to deal with. e-commerce and networking and programming amongst others.5Mbps is required. given higher than expected demands. At the local level there are also initiatives such as Iomairt aig an Oir which may be an avenue for channelling . the UHI project has the aim of being the key facilitator of Higher education opportunities for communities right across the region of a nature and level appropriate to that demanded by the private. The workable minimum for around 128Kbps. encouraging new-starts and attracting inward investment are all central to the aims of the strategy and actions outlined in this report. moving up to the 384Kbps to 512Kbps range will deliver good quality video in window.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ in the region as alternative suppliers to those already within the region become as easy. such priorities are the potential outcomes of focusing on a broadband telecommunications upgrade. combined with a complementary skills development strategy. For example three people engaged in a good quality video conference with each able to see each other would require each user to be able to send at ~400Kbps and receive at ~800Kbps. Highlands & Islands Learning Grid proposals) for VC delivery. UHI development is likely to be totally supportive of broadband networking in remote areas such as the Western Isles and will via the LCC campus. and.” [NGfL – Broadband Networking. play a key role in ICT skills development within the area. while for near TV quality. Ultimately. public and voluntary sectors. full screen video suitable for large room based video systems bandwidth up to 1. creating the conditions for regional competitiveness and developing human resources. making then less than ideal for VC teaching. from the UHI perspective there is an on-going commitment to the area to provide and develop out-reaching distance learning centres via broadband telecoms (e. at the Western Isles level in examination of the Western Isles Transitional Strategy 2000-2006 stated policy areas relate to increasing business competitiveness. if the goal of broadband can be achieved.g. In short. whilst achieving rural development. the recently published HIE Skills Strategy states: “Special focus will be given to developing ICT and management and leadership skills thus enabling individuals and businesses of the Highlands and Islands to gain a competitive advantage. with demand particularly high from small outreach centres throughout the region. In short. It has already spent £22m on technology to overcome the distance barriers within the region. For example at the LCC campus the dual VC suites have increasingly been booked up for VC teaching from 9am-5pm every day of the week. Thirdly. The achievement of social & economic inclusion is again a clearly stated priority and key business strategies aimed at improving competitiveness (businesses and localities). creating employment and increasing incomes.

in consideration of the EU. the Western Isles council has articulated the ICT industries upon which it is to prioritise resources to achieve rural development. From the local authority perspective between 1999-2002. national and regional level policy and strategic level framework for the Information Age. whilst encouraging inward investment. At the Local Enterprise Company level there are the following clearly articulated policies for the ICT sector: • • • Encourage exploitation of latent skills Develop appropriate skills training and expertise Encourage inward investment Develop appropriate infrastructure • Such key objectives are without doubt totally integrated to the development impetus being suggested by this report. Such policies are tied-in with key actions outlined within this report. . The policy context is uniquely placed to enable the area to seize the types of opportunities brought to the fore in this report. Amongst other such priorities there is the on-going commitment to develop an enterprise culture and to create an even spread of opportunities throughout the Islands. In summary.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ additional resources to achieve ICCT-based rural development in some of the Island’s most outlying areas. one must conclude that the focus of this report is both timely and completely relevant to the required incorporation of the Western Isles into the Information Society at an early stage. to focus efforts to realise our place in the ‘new economy’ creating not only digitally connected but also a digitally aware proliferation of rural communities where enterprise and opportunity are primed and populations have stabilised as incomes rise in response to the exploitation of new ways of working.

On-Line Publication DIGITAL SCOTLAND TASK FORCE. eEurope Action Plan. On Line Publication NATIONAL SKILLS TASK FORCE. On-Line Publication SCOTTISH EXECUTIVE. (2000).Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Chapter 8 References: CISCO SYSTEMS. Western Isles Transitional . On-Line Publication HMSO. (Dec. IST 2000. ISBN 92-894-0042-0 HIE. Annual Report. 14-06-00 EU Publication. On-Line Publication DEPARTMENT FOR EDUCATION & EMPLOYMENT. DG Information Society. Office for Official Publications of the European Communities. Our Competitive Future: Building the Knowledge Driven Economy. (June 2000). 1999). NGfL – Broadband Networking. ISBN 0 7480 7289 6 UK ONLINE. Realising Potential: A Strategic Plan for Developing Sectoral Skills in the Highlands Islands. Luxembourg. (Sept. (Dec. On-Line Government Publication WESTERN ISLES TRANSITIONAL STRATEGY GROUP. On-Line Publication HMSO. Digital Scotland: The Scottish Executive’s Response. Digital Scotland Task Force Report. Skills for the Information Age. (1998). Skills for Scotland: A Skills Strategy for A Competitive Scotland. 1998). DTI. First Report SCOTTISH EXECUTIVE. Brussels. (Jan. Towards A National Skills Agenda. (September 2000). On-Line Publication. (1999). Competitive Advantage in the Digital Economy. EU Publication. (May 2000). (February 2000). On-Line Publication HMSO. (January 2000). Project Gemini DIGITAL DENMARK. 2000). (March 2000). Have You Got What It Takes?. (2000). 2000). Digital Denmark: Conversion to the Network Society. UK Information Technology. Communications and Electronics Skills Strategy Group DEPARTMENT FOR EDUCATION & EMPLOYMENT & E-BUSINESS NTO. (June 2000). A New Future for Communications.

w-isles.co.e-envoy.htm#knowledge http://www.cordis.org.uk/digitalscotland/ http://www.html http://europa.gov.skillsbase.career-space.uk/priorities/priorities.int/ISPO/promotion/i_promise.gov.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ INTERNET SITES ACCESSED FOR RESEARCH PURPOSES: http://www.html http://www.tft.uk/ http://www.wie.e-skillsnto.uk/ http://www.uk/Reference/Reference.asp?sect=5 http://www.co.uk/ http://europa.learndirectscotland.gov.scottish.uhi.ngfl.com/ http://www.uk/ http://www.uk .html http://www.eu.com/ http://www.uk/ http://www.lu/fp5/home.parliament.uk/ http://www.int/comm/dgs/information_society/index_en.isi.eu.dfee.gov.org.htm http://www.scotland.gov.ac.gov.uk/regional/scotland.information-society.uk/ http://www.

With the Customer Service Centre market growing at 40% per annum. this number is close to 20% in Finland. outsourcing is increasingly becoming a necessity for many firms and industries in the UK and beyond. cafes. Recruitment is becoming difficult and staff turnover and wages high with many posts remaining unfilled for many months. outsourcing is increasingly becoming a necessity for many firms and industries in the UK. Futuristic thinking which our European counterparts are already adopting. as witnessed by the recent development of e-lance websites with literally 1000s of jobs for teleworkers with the right mix of skills. It needs to be recognised that only 10% of UK workforce is involved in telework at present. As suggested by EU policy makers the development of public/private training partnerships to target resources at key areas of current and advance need would appear to be key requirement for ‘best practice’ initiatives. Initially the local public sector may assist giving newly trained workers the all-important track record.g. Recruitment is becoming difficult and staff turnover and wages high as firms compete for key members of staff. jazzy colour schemes. Public sector investment can be maximised and SME opportunities realised as ICT-related staffing constraints are negated and new distance learning opportunities become deliverable via broadband to rural Island communities. What is termed functional offices with a different feel from that of the conventional workplace need to be developed to cater for all e. The Western Isles already has a recognised track record in this area and needs to exploit it. There is much anticipated scope for development in this sector. casual dress codes…etc to attract (young) employees and increase productivity. there needs to be an increasing recruitment drive targeted at school leavers offering desirable working conditions and incentives to earn money and advance their education via sponsored employee schemes for example. It will not be acceptable to wait for demand-led initiatives to trigger investment … those most appropriately geared-up will attract most of the demand-side activity and investment at the expense of the areas that opt to ‘wait . including crèches. Experience in Ireland points to the need for multi-lingual employees as being a major selling point. with many posts remaining unfilled for many months.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Chapter 9 The Information Society & ICT Skill Requirements Summary. providing we can get this skill mix correct. More fibre-connected people-centred workspaces (customer service centres) need to be created as new ways of working are adopted to meet the needs of all flexible workers in the new economy for which our Islands need to be renowned. Experience in Ireland points to the need for multi-lingual employees as being a major selling point in itself and an area of increasing demand. It needs to be recognised that only 10% of UK workforce is involved in telework at present. whilst this number is close to 20% in Finland. it As the EU ICT skills gap develops. With regard to the Island’s move toward the new economy. More fibre-connected people-centred workspaces need to be created. Conclusions & Recommendations It is clear that as the EU ICT skills gap develops.

a number of sources have been quoted within the text the text which largely which largely agree on the generic content required: agree on the generic content required: • • • • • • • • Written & oral communications Team working Problem solving Business awareness Creativity & Innovation Inter-personal skills Attitude & Enthusiasm Technology skills The relatively low priority given to technology skills should be noted. In the view of the writer this is therefore not an option but rather an immediate necessity. As no one can confidently predict where this new revolution is going. to enable this transformation.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ trigger investment. One must be part of the revolution if one is to gain the advantage and opportunity associated with it. . an increasingly global marketplace (b2b and b2c – Business to Consumer) will be on their doorstep and new opportunities abundant. by an efficiency-seeking commercial market. Specific skills necessary – a number of sources With regard to the specific skills necessary in the Information have been quoted within Age. the postponement of investment until the market settles is not a legitimate development policy. As Business to Business (b2b) competition increases via ecommerce enabled transactions that will be distance independent and reduce supply cost significantly for ecommerce enabled SMEs in the Islands there are both threats and opportunities. which in many instances were viewed as being less important to the ICT sector. Low priority given to technology skills – viewed as being less important to the ICT sector than business and customer service skills. In all but the most technical of posts. There appears to be a pervasive view within the sector that if the key generic skills can be attained then the ICT skills can be developed in-house. Yet for those that take the leap of faith. Non-e-commerce SMEs in the region will find their products and services being replaced by those that are. where it has been recognised that those most appropriately geared-up will attract most of the demand-side activity and investment at the expense of the areas which opt to ‘wait and see’. The more progressive areas in Europe have already considered the folly of this in the new Information Age. such feedback appeared to be commonplace. Obviously ICT skills and appropriate telecoms will require to be developed throughout the Islands area.

Such initiative has already been shown to be profitable in the examples outlined within the main text. science & mathematics along with specific ICT skills were viewed as being important. . In almost all instances previous work experience was a stated preference and again there may be a role for the local public sector to aid this transition initially. Appreciation of such findings need to Islands-wide Information Age Skills incorporating an awareness-raising graduates and employees within the project Gemini in South-East England. industry and the public sector will identify clearly the needs. The commitment at the EU. This policy is integral to the advancement of the broadband telecommunications recommendations made earlier. Such specific ICT skills outlined within the report combined with the appropriate generic skills will potentially provide the catalyst to enable a transition in the Western Isles workforce to one compatible and in-demand within the new ‘Digital’ economy. initiative for non-ICT Findings need to be area. it is here that an ICT skills/training partnership between the education sector. opportunities and delivery options to integrate the Island’s population into the Information Age and respond dynamically to future trends. Again. An opportunity exists to focus on in-demand ICT skills to plug the developing skills gap and encourage specialist teleworking and outsourcing teams to become established.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Language. Science and mathematics along with specific ICT skills were viewed as being important. There is a clear policy framework in which to develop the Western Isles’ skills development response to the Information Age. Language. be incorporated into an Development strategy. There is an obvious synergy between the two key areas considered in this report. A dual development approach can therefore achieve cost savings by combining the financial allocations for both skills and broadband rollout by encouraging the facilitation of an all-encompassing partnership approach at the local level Focus on in-demand ICT skills to plug the developing skills gap and encourage specialist teleworking and outsourcing teams to become established. An opportunity to deliver core skills online via outreach centres combined with added-value SME integrated workspace would appear a real prospect with linkages to other national initiatives such as the NGfL and SufI’s ‘Learndirect’ initiative. although the range of the above generic skills was still sought after. A pilot project targeted at those individuals on the ICT skills register and school leavers could be progressed. similar to that of incorporated into an Islands-wide Information Age Skills Development strategy. national and regional policy levels which focus on ‘skills for the information age’ recognise some of the infrastructural requirements for delivery and have associated funding for such development.

call centre services. video telephony Internet/intranet access.048 Mbps full duplex (E1) (uses 1 wire pair) 10.000–4.5–8 Mbps downstream Up to 1.8 or 33.000 feet (additional equipment can extend the distance) 30 miles over coaxial (additional equipment can extend the distance to 200 miles) 18. LAN interconnect Local. video-ondemand. VPNs. LAN interconnect Multimedia Internet access. remote LAN access. IP telephony. Frame Relay traffic aggregator. Internet/intranet access Video conferencing.000 feet (12.000 feet (additional equipment can extend the distance) 12.000–15.544 Mbps full duplex (T1) 2. disaster recovery.5–2. not dedicated. Web browsing. bandwidth) Up to 1 Mbps downstream Up to 512 Kbps upstream 1.544 Mbps upstream Up to 144 Kbps full duplex E-mail. high-definition television program delivery HDSL 1. video telephony Local. collaborative computing.000 feet Applications 56 Kbps analog modems ISDN 56 Kbps downstream Up to 128 Kbps (uncompressed) Full duplex Cable modem 10–30 Mbps downstream 128 Kbps–10 Mbps upstream (shared. transaction processing. remote LAN access.000 feet IDSL Internet/intranet access.500 feet (depending on speed) .3 Mbps upstream (up to 34 Mbps if symmetric) 1. IP telephony.048 Mbps full duplex (E1) (uses 2–3 wire pairs) SDSL 1.000 feet VDSL 13–52 Mbps downstream 1. repeatered T1/E1 trunk replacement.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ APPENDIX 1: xDSL TECHNOLOGY Technology Speed Distance Limitation (24-gauge wire) None 28. repeatered T1/E1 trunk replacement. Web browsing. Internet/intranet access Internet access ADSL Lite ADSL/R-ADSL 18. leased line backup. PBX interconnection. VoIP Internet/intranet access.6 Kbps upstream 18.544 Mbps full duplex (T1) 2.000 feet for fastest speeds) 18.

ADSL can provide 1. it is possible to connect over different lines at varying speeds. Connection speed can be selected when the line synchs up. It allows more bandwidth downstream—from an NSP’s central office to the customer site—than upstream from the subscriber to the central office. while IDSL does not (DSL is an “always on” service). 3Com is an active participant in these standards bodies working on the development of ADSL Lite.000 to 12. the rate is between 640 Kbps and 1. it differs from ISDN in a number of ways. An ITU standard (G. Users of these applications typically download much more information than they send. This asymmetry. .5 and 8 Mbps. Additional standards work can be expected in ANSI TIE1. ISDN Digital Subscriber Line (IDSL) IDSL provides full duplex throughput at speeds up to 144 Kbps. combined with “always on” access (which eliminates call setup). video-on-demand. and the ADSL Forum to address issues such as compatibility with home wiring and network interfaces. ADSL Lite is also supposed to work over longer distances than full-rate ADSL. 1998. Unlike ISDN. Optimal speeds of 6 to 8 Mbps can be achieved at distances of 10. but adjusts dynamically to varying lengths and qualities of twisted-pair local access lines.4. so it does not cause switch congestion at the service provider’s CO.992.54 Mbps. or as the result of a signal from the central office. Elimination of the POTS splitter is intended to simplify DSL installation and reduce the costs of DSL for NSPs. Unlike ADSL. during a connection. upstream. an industry group that worked to develop a worldwide G.Lite standard within the International Telecommunications Union (ITU) Study Group 15.54 Mbps transmission rates at distances of up to 18.000 feet over one wire pair. While IDSL uses the same 2B1Q modulation code as ISDN to deliver service without special line conditioning. IDSL is a non-switched service.000 feet using standard 24-gauge wire. and remote local area network (LAN) access. making it more widely available to mass market consumers. Downstream. It will support both data and voice and provide an evolution path to full-rate ADSL. the ATM Forum. ADSL supports speeds between 1. With R-ADSL. IDSL is restricted to carrying data only.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Asymmetric Digital Subscriber Line (ADSL) ADSL technology is asymmetric. makes ADSL ideal for Internet/intranet surfing. Rate-Adaptive Digital Subscriber Line (R-ADSL) R-ADSL operates within the same transmission rates as ADSL. ADSL Lite ADSL Lite is a lower-speed version of ADSL that will eliminate the need for the telco to install and maintain a premises-based POTS splitter.2) was approved in October. The effort to introduce ADSL Lite has been spearheaded by the Universal ADSL Working Group. ISDN also requires call setup.

Downstream speeds typically range from 768 Kb/s to 9 Mb/s Upstream speeds typically range from 64Kb/s to 1.3com.html A More Recent Attempt at Definitions: ADSL Asymmetric Digital Subscriber Line (ADSL) is the most popular form of xDSL technology. VDSL’s additional bandwidth could potentially enable NSPs to deliver high-definition television (HDTV). but SDSL differs from HDSL in two important ways: it uses a single copper-pair wire.5 to 2.3 Mbps over a single copper-pair wire. Very High Bit-Rate Digital Subscriber Line (VDSL) VDSL technology is the fastest xDSL technology. Single-Line Digital Subscriber Line (SDSL) Like HDSL. the maximum operating distance for this asymmetric technology is only 1. sounds and video) with minimal upload capacity required (keystrokes and mouse clicks). HDSL is the most mature of the xDSL technologies.5Mb/s. HDSL’s reliance on two and three twisted-pair wires makes it ideal for connecting PBX systems. digital local loops.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ High Bit-Rate Digital Subscriber Line (HDSL) HDSL technology is symmetric. This is in part due to the limitation of the telephone cabling system and the desire to accommodate the typical Internet usage pattern where the majority of data is being sent to the user (programs. IEC points of presence (POPs). The key to ADSL is that the upstream and downstream bandwidth is asymmetric. have a data rate of 2. Internet servers.000 to 4. SDSL supports symmetrical TI/E1 transmissions. video-on-demand. used in North America. graphics. or uneven. providing the same amount of bandwidth upstream as downstream. Due to its speed—1. In practice.000 feet. VDSL is in the requirements and standards definition stage. Within its distance limitation. However.000 to 15. have a data rate of 1. but over a single pair. (T1 lines. E1 lines. supporting a downstream rate of 13 to 52 Mbps and an upstream rate of 1. and switched digital video. phone companies can install signal repeaters to cost-effectively extend its useful range.048 Mbps over three pairs—telcos commonly deploy HDSL as an alternative to repeatered T1/E1.) Although HDSL’s 12.500 feet away. used in Europe. and has already been implemented in telco feeder plants (lines that extend from central offices to remote nodes) and also in campus environments. as well as legacy LAN extension symmetrical services. SDSL is a precursor to HDSL II.048 Mbps. In addition to supporting the same applications as ADSL. this distance can be extended by running fibre optic cable from the CO to an optical network unit and copper from that point to the user location up to 4. VDSL can be viewed as a cost-effective alternative to fibre to the home. It will offer the same performance as HDSL. and campus-based networks. .544 Mbps over two copper pairs and 2. and it has a maximum operating range of 10. SDSL is capable of accommodating applications that require identical downstream and upstream speeds.544 Mbps. the bandwidth from the provider to the user (downstream) will be the higher speed path.com/technology/tech_net/white_papers/500624. Source: http://www.000-foot operating distance is shorter than ADSL’s. such as video conferencing or collaborative computing. HDSL II is pro-posed as the nextgeneration HDSL within ANSI and ETSI.500 feet from the central office.

This will allow the ability to avoid interference on a packet-by-packet basis by shifting frequencies as necessary. HDSL. IDSL ISDN based DSL developed originally by Ascend Communications.000 feet. HDSL2 uses overlapped phase Trellis-code interlocked spectrum (OPTIS). It uses pulse amplitude modulation (PAM) on a 4-wire loop. short for Ethernet Local Loop.413 by the UAWG (Universal ADSL Working Group) led by Microsoft.shdsl is a ITU standard which offers a rich set of features (e. E1.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ ADSL Lite (see G. G. HDSL High Bit-rate Digital Subscriber Line (HDSL) is generally used as a substitute for T1/E1. but eliminates the POTS splitter at the customer premises.992. EtherLoop uses the advanced signal modulation techniques of DSL and combines them with the half-duplex "burst" packet nature of Ethernet.g. E1. they will use only a low-frequency (ISDN-speed) management signal. it is capable of generating the same bandwidth rate in either the upstream or downstream direction. HDSL is becoming popular as a way to provide full-duplex symmetric data communication at rates up to 1. SDSL HDSL2. EtherLoop can measure the ambient noise between packets. ISDN and IP. and Compaq. As a result. G. CiDSL Globespan's proprietary.shdsl also allows for the negotiation of a number of framing protocols including ATM. EtherLoop modems will only generate hi-frequency signals when there is something to send. the splitting of the signal is done at the local CO. MDSL Usually this stands for multi-rate Digital Subscriber Line (MDSL).544 Mb/s over a single copper pair. IDSL uses 2B1Q line coding and typically supports data transfer rates of 128 Kb/s. HDSL has a longer range than T1/E1 without the use of repeaters to allow transmission over distances up to 12. but uses the full bandwidth of two 64 Kb/s bearer channels plus one 16 Kb/s delta channel. Many end users have had to suffice with IDSL service when full speed ADSL was not available in their area. but not simultaneously. this technology is not splitterless per se. rate adaptive) and offers greater reach than many current standards. splitterless Consumer-installable Digital Subscriber Line (CiDSL). HDSL2 High Bit-rate Digital Subscriber Line 2 was designed to transport T1 signalling at 1. This is known as G. It uses the same modulation scheme as ADSL (DMT). It depends on the context of the acronym as to its meaning. to boost the signal strength.2 in the ITU standards committee. EtherLoop EtherLoop is currently a proprietary technology from Nortel.shdsl is touted as being able to replace T1. the ADSL signal is carried over all of the house wiring which results in lower available bandwidth due to greater noise impairments. The rest of the time.544 Mb/s (2. Nortel is initially planning for speeds ranging between 1. Since EtherLoop will be half-duplex. Traditional T1 (E1 in Europe) requires repeaters every 6000 ft.lite A lower data rate version of Asymmetric Digital Subscriber Line (ADSL) was been proposed as an extension to ANSI standard T1. G. ISDN and IDSL technologies. This technology is similar to ISDN. Instead of requiring a splitter at customer premises. It is either a proprietary scheme for SDSL or . Intel. T1. Often a misnomer. G.shdsl G.048 Mb/s in Europe) over moderate distances via conventional telephone twisted-pair wires.lite) CDSL Consumer Digital Subscriber Line (CDSL) is a proprietary technology trademarked by Rockwell International.5Mb/s and 10Mb/s depending on line quality and distance limitations.

Source: http://homepage. which is a function of line conditions and signal to noise ratio (SNR). The name has become more generic over time to refer to symmetric service at a variety of rates over a single loop. VDSL Very High Bit-rate Digital Subscriber Line (VDSL) is proposed for shorter local loops. UDSL Universal DSL. There is also another proprietary scheme which stands for medium-bit-rate DSL. SDSL Symmetric Digital Subscriber Line (SDSL) is a 2-wire implementation of HDSL. Data rates exceed 10 Mb/s.txt .413 standard DMT modems are also technically RADSL.com/~jkristof/xdsl-faq.000 ft.lite. T1. See G. The uplink rate depends on the downlink rate. but may specifically refer to a proprietary modulation standard designed by Globespan Semiconductor. Supports T1/E1 on a single pair to a distance of 11. perhaps up to 3000 ft.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ see the acronym MSDSL. Confused yet? RADSL Rate Adaptive Digital Subscriber Line (RADSL) is any rate adaptive xDSL modem.interaccess. but generally not referred to as such. It uses carrierless amplitude and phase modulation (CAP).

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ APPENDIX 2: MVL: A BROADBAND SUBSCRIBER LINE TECHNOLOGY Features of MVL [http://www.413 spectral requirement Operates at under 100 kHz Superior loop reach in excess of 30. no end-user configuration required Operates over existing twisted or untwisted wire and plugs into existing telephone jacks Each IP MVL modem supports up to 250 IP devices connected to the ethernet port OpenLaneTM Network Management Solution delivers end-to-end NMS monitoring.com/]: ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ First DSL Modem to be FCC Part 68 approved and registered as "safe to deploy in the public switched telephone network" Complements the deployment of standards-based ADSL (DMT/G.601 Basic Rate ISDN T1. and enables Services on Demand: Simultaneous POTS and data Hotwire HomeLink feature enables peer-to-peer print and file sharing between IP MVL modems connected to the same WAN link Dynamic bandwidth allocation supports multiple applications simultaneously Plug and play installation.12 milliwatts per port allows greater port density and lower costs Industry-defining MVL technology with products designed and optimised for residential.paradyne. No service technician truck roll required at the customer premises 768 Kbps speed downstream and upstream High density 12-port line card delivers 216 IP MVL ports per Hotwire GranDSLAM chassis Flexible Ethernet or ATM output to the service provider's network Low power dissipation of 1. control and diagnostics PARADYNE CORPORATION ON-LINE MVL FEATURES PAGES: .lite) and SDSL services Integral part of Paradyne's "Never Say No DSL" Hotwire GranDSLAM advantage Offers superior spectral compatibility: Operates within globally accepted spectral requirement of T1. branch office and SOHO markets Supports from one to four Hotwire IP MVL modems on a single telephone wire Impervious to bridged taps Offers superior functionality for simultaneous data and voice services. greater than CSA/RRD specification Splitterless Design.000 feet in real-world deployments.

ATM SDSL and IDSL services. SOHO and branch office market space with unprecedented functionality. "Never Say No DSL" to your customer again -. IP RADSL. The data on these lines is quickly encapsulated and directed onto the powerful ATM backplane.Lite) and SDSL. small office/home office (SOHO). with this centralised power forming the core of Paradyne's "Never Say No DSL" deployment strategy. and branch office environments. Ethernet Networking Line Card The Hotwire 8312 IP MVL Line Card accepts 12 subscriber lines coming in from a Telco connector at the rear of the Hotwire GranDSLAM and efficiently aggregates them onto a single 10Base-T full-duplex Ethernet connection for backhaul onto the service provider's network. TDM SDSL. The Hotwire GranDSLAM allows service providers to deploy standards-compliant ADSL (DMT/G. The 12-port. Paradyne delivers the only DSLAM in the industry able to support this broad range of services from a single platform. The Hotwire IP MVL System extends the Hotwire product line into the residential. deploy IDSL for customers residing behind a digital loop carrier (DLC). the Hotwire IP MVL System fundamentally changes the way data and voice services are delivered to the mass market. Hotwire IP MVL is deployed from the very same Hotwire GranDSLAM that supports the provisioning of Paradyne's complete family of multiservices line cards. which communicates with a Hotwire IP MVL Endpoint Modem at the customer premises. performance and cost. the Hotwire IP MVL solution can further aggregate 10Base-T connections and offers internetworking to frame relay or ATM networks. IP SDSL. and IP MVL to provision DSL services over extended loop lengths. The data from each of the Hotwire 8314 IP MVL Line Cards installed in the Hotwire GranDSLAM is efficiently aggregated onto a single high-speed ATM connection for backhaul onto the service provider's network. Based on Paradyne's patented MVL technology. The Hotwire IP MVL solution is comprised of a Hotwire IP MVL Line Card installed in the Hotwire GranDSLAM chassis.the Paradyne advantage. consisting of today's commercial-grade ADSL (DMT/G.Lite). ATM Networking Line Card The Hotwire 8314 IP MVL Line Card accepts 12 subscriber lines coming in from a Telco connector at the rear of the Hotwire GranDSLAM. high-density Hotwire IP MVL Line Card is available in two flexible configurations supporting either an Ethernet or ATM networking model. Hotwire MVL System Overview Hotwire IP MVL Systems offer both flexibility and investment protection. The Hotwire IP MVL 6310 customer premises modem delivers up to 768 Kbps of . When coupled with the Hotwire IPC.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The award-winning Hotwire Multiple Virtual Lines (MVL®) System is an industrydefining family of solutions designed and optimised for the residential.

Hotwire IP MVL Systems are also spectrally compatible with the T1. have a power dissipation of less than 1. Hotwire MVL has the unique and powerful multi-drop feature. which enables: .000 feet in real-world deployment. High Density and Low Power Consumption The Hotwire IP MVL System delivers performance advantages allowing it to achieve high densities within the central office. which is globally deployed today.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ customer. The 864 ports that are supported in a seven-foot cabinet. Hotwire IP MVL Systems will be no more of a disturber to other services than ISDN.12 milliwatts per port. Services on Demand The ground-breaking innovation of MVL technology is its ability to transform a single copper wire loop into multiple virtual lines which support multiple services simultaneously. Hotwire IP MVL is unique in that it will maintain the highest possible speed and longest possible reach in the presence of common real-world disturbers. This multi-drop support is available through the Hotwire IP MVL Line Cards and IP MVL Endpoint Modems (6310-A2 or greater). The Hotwire IP MVL System is designed and built for industrystandard NEBS compliance. In addition. This self-imposed design rule ensures compatibility with existing services. Industry-Leading Performance The Hotwire IP MVL System has achieved distances in excess of 30.601). multi-tenant unit (MTU) and Hospitality environments. Hotwire IP MVL leverages this capability to deliver unique functionality. Hotwire IP MVL Modems are customer installable. and transparently operate over existing in-home wiring (twisted or untwisted) for total customer convenience and satisfaction. the Hotwire IP MVL System operates within the same globally accepted spectral limits of ANSI/ETSI Basic Rate ISDN (T1. which allows up to four Hotwire IP MVL modems to be connected to the same telephone line and share a common WAN access.413 standard and use less than 10 percent of the signal processing power required for other full-rate DSL implementations. This industry-leading performance is obtained mainly due to the Hotwire IP MVL System operating at frequencies below 100 kHz. plugging into any existing RJ-11 telephone jack. multi-dwelling unit (MDU). referred to as Services on Demand. when using the Hotwire 8810 DSLAM chassis. This results in an unimpaired performance even in the presence of T1/E1 disturbers. Superior Spectral Compatibility Solving mass market deployment issues relating to spectral interference and crosstalk. The Hotwire HomeLink feature enables peer-to-peer print and file sharing capabilities among the four Hotwire IP MVL Modems within the home or small office environment.

or low-speed services. allowing from one to four devices to share a single line at the same time. Dynamic bandwidth allocation for multiple and independent applications simultaneously. independent applications. On-site maintenance cost and customer interruptions are reduced through the ease and . backup devices and colour printers (used with Windows 95/98 file and printer sharing application).Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ ♦ ♦ ♦ ♦ Multiple virtual line provisioning for high. diagnostic troubleshooting tools. OpenLane inter-operates with standard management platforms such as HP OpenView and Tivoli NetView in NT and/or UNIX (Sun) environments. Hotwire HomeLink (in-home LAN) peer-to-peer print and file sharing within the same environment using Windows 95/98 file and printer sharing application. popular programs. Network Management Solution The Hotwire IP MVL solution offers service providers extensive management capabilities. Hotwire HomeLink The Hotwire HomeLink LAN feature enables multiple Hotwire IP MVL Modems. health and status checking. another user within the same environment can concurrently upload files back to a home office and yet another can listen to the newest audio streaming clips from another Web page. The entire Hotwire family is managed using Paradyne's OpenLane Service Level Management Solution. Hotwire HomeLink peer-to-peer communication allows Hotwire IP MVL connected users to utilize the available resources of each computer. as well as service level results reporting. sharing the same WAN link. to communicate in a peer-to-peer networking fashion. Dynamic Bandwidth Allocation The Hotwire IP MVL System dynamically and instantaneously allocates bandwidth for multiple. an advanced Web-based management application that provides configuration control. sharing the same WAN link. realtime and history performance monitoring displays. Hotwire HomeLink provides this LAN communication for end users connected to up to four different Hotwire IP MVL Modems at the customer premises. While one user might be downloading files from the Internet. such as common files. Simultaneous access of multiple devices sharing a common WAN interface.

32 cm) high x 10. 384K. Transmission Speeds • 8312/8314: Eleven speeds are available at 128K. MVL Specifications Hotwire IP MVL Line Card • 12-port line card which is installed in the Hotwire GranDSLAM Hotwire IP MVL Endpoint Modems • Model 6310-A2: Ethernet standalone modem with a 10Base-T interface. Alarm.18 cm) high .4 in.23 cm) deep x 1. 512K. MVL Port 1-12 Link-Up • 6310: Power.24 cm) wide x 8.25 in. Technical Assistance and Communication/Documentation.8 in. (2. 448K. MAC learning bridge. (15.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Technical Support Programs You can easily ensure your investment protection for years to come. 256K.42 cm) deep x 0. 576K. (28. 320K. (26. 192K. (3. DSL Link. Paradyne offers three key technical support services in a single package: Software Maintenance. 640K. Test Ethernet Link Activity. MAC learning bridge. Ethernet standalone modem with a 10Base-T interface. (22.75 in. 704K and 768K • 6310: Automatically matches the speed of MVL Line Card DSL Interface • 8312/8314: 50-pin Telco connector on the back of the Hotwire GranDSLAM chassis • 6310: RJ11C connector Digital Interface • 8312: Full-duplex 10Base-T • 8314: ATM • 6310: 8-Pin Mod 10Base-T Ethernet port Status Indicators • 8312/8314: Normal. Ethernet Link(s) Management • 8312/8314: Integrated SNMP agent • 6310: SNMP management by proxy Dimensions • 8312/8314 Line Cards: 11.15 in.03 cm) wide • 6310 Endpoint Modems: 6 in. • Model 6310-A3: Integrated POTS filter and supports the pass-through for a second phone line. Test. Alarm.

CSA C22. 950-95. FCC Part 15 Class A 3rd Ed. EN55022 (CISPR22). UL1950 3rd Ed. 47 to 64 Hz. EN60950. NEBS Level 1. non-condensing Certifications • FCC Part 68.. VCCI . 120V AC.2 No. 60 Hz Physical Environment • 8312/8314: • Operating Temperature: 32° F to 140° F (0° C to 60° C) • Storage Temperature: -40° F to 158° F (-40° C to 70° C) • Humidity: 5% to 95% relative..Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ • • 8312/8314: Draws power from the DSLAM chassis 6310: 90V AC to 259V AC.

) Berneray (UXD5B) Manish (UXD5B) Sollas (UXD5B) Bayhead (UXD5) Lochmaddy (UXD5B) Locheport (UXD5B) Benbecula (Sys-X) Carnan (UXD5B) Grogarry (UXD5B) Bornish (UXD5B) Lochboisdale (Sys-X) Eriskay (UXD5B) Northbay (UXD5B) Castlebay (UXD5B) DIGITAL EXCHANGES IN THE WESTERN ISLES .Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Port of Ness (Sys-X) 0 40Km M s Carloway (UXD5B) Borve (UXD5B) Barvas (UXD5B) Shawbost (UXD5B) North Tolsta (UXD5B) Callanish (UXD5B) Great Bernera (UXD5B) Timsgarry (UXD5B) Back (Sys-X) Garrabost (Sys-X) Stornoway (Sys-X) Crossbost (UXD5B) Scarp (UXD5B) Balallan (UXD5B) APPENDIX 3: UXD5 AND SYSTEM-X Gravir (UXD5B) Scarista (UX5DB) Sclapay (UXD5B) Leverburgh (UXD5B) Harris (Tarbert) (Sys-X) Drinnishadder (L/Conc.

TXD10 Medium Combined Trunk/ Local Exchange TXD12 Medium Trunk Exchange TXD13 Large Trunk Exchange TXD14 Junction Tandem Exchange . West Kensington. began working in Baynard House in July 1980. However. a junction tandem exchange TXD14. General Electric Company (G. The first fully digital exchange to be brought into service in the UK was a UXD5A (Unit eXchange Digital).O). Aberdeenshire in 1979. on 15th February 1968 an exchange. an updated version UXD5B was installed in further rural locations. Standard Telephone & Cables (S. Ealing and Shepherd's Bush. a public-exchange variant of the Monarch digital PABX and remains only in the Highlands of Scotland and rural Wales. This digital tandem exchange was moved into Empress. MXD03 mobile version.) and Plessey. TXD09 Digital Principle Local Exchange based on LLE above. It was the first exchange to switch PCM signals from one group of lines to another in digital form. System X designations are: TXD01 Multiplexor TXD02 Very Small Local Exchange TXD03 Remote Concentrator Unit (RCU) parented on a DCCE (Digital Cell Centre Exchange).P.C). using TDM and PCM (Pulse Code Modulation) was demonstrated at the Post Office Research Station at Dollis Hill. System X was the original specification developed by the British Post Office (B. a modified Monarch 300 line PBX at Glenkindie.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ APPENDIX 4: BACKGROUND INFORMATION ON TELEPHONE EXCHANGES TXD or Digital exchanges are software controlled using both digital signalling and transmission to connect the calls. The first production System X exchange. London in April 1968 to switch calls from Acorn. The UXD5.T. TXD04 Small Local Exchange TXD05 as per UXD5 TXD06 Medium Local Exchange TXD07 Large Local Exchange TXD08 Digital Principle Local Exchange based on MLE above. And from 1983.C.E.

5ESS PRX and DMS100. Ericsson made the AXE10 which offered practically the same flexibility in a smaller box (mainly because System X was designed by committee: (it was already dated before the first release model became available). International Switching Centre. around 97% of customers are connected to digital or modern electronic exchanges. The DMS100. comprising 5. . System X is an all-British family of digital exchanges manufactured by GEC Plessey Telecommunications (GPT). Vauxhall. System Y designations are: TXD53 RCU parented on a central processor.532 digital. designed and built by Northern Telecom (NT) is being used for Featurenet services. 1. AXE 10. All traffic on the trunk network is now handled by 59 fully interconnected Digital Main Switching Units (DMSUs) and four partially connected Digital Switching Units (DSUs) which help handle high call volumes from between London and the Home Counties. GEC. At 30th September 1993. UXD 5. International traffic is handled by 4 dedicated exchanges. 38 crossbar and 666 Strowger (electromechanical).Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ System Y is the AXE10 version bought ' off the shelf ' from Thorn Ericsson and produced at factories in Brighton and Scunthorpe. It was decided that there should be at least TWO suppliers to the PO/BT. and there was a large international tender to decide on a second. BT operated 7. Kent was brought into service just two years later. and 5ESS PRX is the European version of a system developed by the American company AT&T and widely used in North America.301 electronic. UXD 5 is a small system specifically developed by BT for rural areas. What is the difference between a System X and System Y exchange ? System X was a co-operative development by Post Office Telephones. There was a big bust-up in which STC were removed (and given exclusive rights to supply TXE4) and GEC and Plessey were given all the rights and obligations to develop System X as a commercial system which BT would then buy by competitive tender. AXE 10 is a Swedish design and manufactured in the UK by Ericsson Telecommunications Ltd. TXD20 an AXE10 exchange opened in Keybridge House. London in 1984. By March 1996 all customers will be served by modern electronic exchanges. System X. competitive system.537 local exchanges in the UK. TXD57 Large Local Exchange Five designs of digital exchange are/have been installed in the UK. in Sevenoaks. Plessey and STC. And the first local AXE10. The last analogue switch was removed from the trunk network in June 1990. At the local level.

If anything the AXE10 is more full-featured than the 'X' but BT only took the basic software package on each. . The AXE10 became BT's 'System Y' just to keep things 'simple'. Vodafone tried Ericsson. Cellnet tried to use System X as their mobile switch but dumped it as it was very old tech. so both offer practically the same. Sources: UK Telecoms Newsgroup FAQs + associated links. Incidentally. and that is why Vodafone runs totally on AXE10s.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ The AXE10 was chosen and was then (and still is) bought by BT in competition with System X.

Videoconferencing Video conferencing applications use data compression to allow two-way multi-user video conferencing connections to work over limited bandwidth channels. Remote shopping.with up-to-date information including video clips.Schools.. lectures etc. Some illustrative examples include maps and situation awareness data..services including high definition images and video clips of the offered goods. Some typical examples are: • • • • • • • • News agencies for distribution of high resolution images. network news. Information dissemination and broad-/mulitcast Satellite networks are better media to deliver bulk data. can be achieved by students anywhere in the Satellite coverage area. universities.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ APPENDIX 5: Applications for Broadband Satellite Internet Access Web Browsing The most common use is. such as Webcasting. and medical data. which cannot be satisfied by common technologies. Other factors are the hit ratio of the cache server and the Internet gateway performance. Digital distribution of CDs and video to agencies for immediate launch. Real estate agencies. and TV programs can be very expensive for point-to-point networks. Data broadcast. anywhere and anytime. WWW browsing. battlefield information. With satellite. promotion campaigns and production Administration Data Base . FTP access. The PSTN infrastructure of today limits the video conferencing to one-on one. hospitals. but is ideally suited to broadcast satellites. and also electronic mail. The content can be transmitted via the high-speed satellite channel either individually to . all subsidiaries in the spot beam of the satellite have instant access to the database at their headquarters. GEO satellites are far more suitable for these applications than is the traditional terrestrial network. High end users. Telecommuters and Small Office/Home Office users desire high bandwidth access. . Corporate Applications A major application for businesses is the extension of their Intranet or corporate network to all of their subsidiaries. Banks – access to the customer financial data Hotels – hotels in remote locations offering internet access in their hotel rooms Distance Learning Access to remote site containing educational oriented data as electronic library. obviously. Travel agent information with up-to-date availability of rooms hotels or other facilities. Therefore. Browsing as an interactive application and greatly depends on the performance of the satellite protocol. point-to-point sessions. Networks with downstream bandwidth rates as the Satellite based networks can provide the required capabilities for multi user simultaneous sessions where the downstream data combines several sites participating in the conference. stock market and financial numbers.

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________

Internet Service Providers ISP’s are companies that provide a range of IP based services including Internet access and related connectivity, web hosting, data warehousing and targeted information services. ISP’s can effectively use satellite communication to provide fast Internet access to subscribers or businesses, which are out of reach of DSL or cable modem providers. One of the services taking advantage of the satellites broadcast nature is Webcasting, where Video or Audio signals such as news, interviews, or reports are broadcast over the Internet. Local caching or mirroring is a means of improving the response times for Internet using when accessing the web. The most commonly accessed Internet pages are locally stored in huge servers. VSAT technology can be used to feed and update these local servers with the current web contents and thus improve the performance of the ISP. Source: http://www.stmi.com/whitepaper.html

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________

APPENDIX 6: teleworking

The First Age: telework is out in the cold
The 1980s: European teleworkers measured in thousands rising to 1 million by the late 1980s

Telework was a topic for discussion amongst some researchers and policy makers and practised only by a handful of gurus and by the technological elite

The Second Age: telework is in the kitchen
Early to mid 1990s: 1 to 2 million European teleworkers In this age, vanguard economic groups took over, especially those individuals with the resources and authority to be able to determine their own ways of working without recourse to higher decision-makers.

The Third Age: telework is by the fire
1997-98: between 2 and 4.5 million European teleworkers (though this is probably an underestimate) This age marked the take-off of telework during which a meeting of minds and objectives started to form between large numbers of decision-makers (who began to see the economic benefits of teleworking), and large numbers of workers (who began to understand and demand the benefits telework could bring to both their working and private lives)

The Fourth Age: telework is in the frying pan
From 1999: over 9 million European teleworkers Telework is now in flux; it is starting to exhibit a wide range of characteristics and forms, entering a large number of different sectors and situations, and using manifold techniques and methods, all of which, however, arise from the core characteristic of being enabled by the new network technologies. In this context, telework is indeed becoming the new form of work.

Source: Botterman, Maarten & Johnston, Peter., (August 1999), Status Report on European Telework – New Methods of Work 1999,
Office for Official Publications of the European Communities, Luxembourg, ISBN 92-828-7960-7

Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________

Appendix 7: ICT SKILLS PROPOSALS
The 'ICT Consortium' recommends action on a number of fronts to address both the immediate shortage and long-term availability of skilled people. • Proposals to increase long-term availability of Skilled workers The 'ICT Consortium' recommends:
• The establishment of a Task Force comprising of industry, educational institutions, the European Commission and the Member States to examine how the educational infrastructure can meet the ICT needs of European industry and to implement appropriate actions. That is, to put in place a clear framework that describes the skills and competencies required, the ladder for career progression, the qualifications and training required and to identify where such qualifications can be obtained. The ICT Consortium initiative known as the 'Generic Skills Pilot Project' should form the basis for work in this area. The appointment of a dedicated team within the European Commission under the direct responsibility of a Commissioner to co-ordinate all Community action in this area. Encouraging Electrical Engineering and Computer Science University departments to combine in order to recognise communications convergence and remove both duplication and historic differences in approach and culture. That IT literacy should be treated as a core part of school curricula in the same way as reading and writing and to be taught not as an option, but as a set of key skills and the key to ongoing learning. That educators at all levels, but especially those with career guidance responsibilities must actively work to attract students, especially girls into science, engineering and ICT relevant courses and positively present the opportunities available within the ICT sector. That all teachers, lecturers and education officials should be IT literate and actively encourage the use of ICT across curricula and non-curricula activities. That all investment, individual or business, in ICT learning and education should be tax-exempt. This should include the provision of free services and of ICT kit to staff. That professional institutions responsible for curricula development and accreditation should be much more flexible on course and entry criteria to meet the needs of the

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• • • • Acknowledgements . A number of programmes of this kind have been undertaken with impressive results and these should be carefully evaluated as possible models for more general application. Governments and the private sector should work together to provide ICT training through public / private partnership programmes.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ rapidly changing ICT industry. • • Access and format of ICT tertiary education should be much more open and flexible to encourage the entry of people who did not follow traditional routes. Increased capital investment in learning centres and networks as well as investment in materials is needed. Just-in-time cross training is needed to give new skills to already experienced professionals. Consideration should be given to opening-up higher level engineering education in Europe to the private sector. Promoting ICT/technical studies by reducing the tuition fees or providing other financial incentives for these studies. ICT professionals and companies are less concerned with professional membership than abilities. approach and motivation.

Mason Communications Neil Finlayson. Gilat.com Angela Macleod. Stan Schneider. BT Bernard Steinebrunner. Europe Maurice at DirecPC. Shetland Andrew Muir. STM Inc.work-global. UK Donnie Morrison. iomart Ltd Michael Jones. Highlands & Islands Enterprise .work-global. www. Consultant. www. Paradyne Co David McGovern. Scottish Centre for Information Research Stuart Robertson.com Dr Wolfgang Greller. Paradyne Co Ken Kriz.Rural Broadband Telecoms & Skills Research March 2001 _____________________________________________________________________________________ Thanks also to the following people consulted and who took time out to talk or reply via e-mail to requests for information : Jimmy Duncan. KIT.

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