"Ubiquitous access" is a heady phrase, but if any one company is in a position to help customers reach such a goal, it's AT&T Corp. The telecommunications giant is making a major play in the broadband data services market, introducing last week new DSL (digital subscriber line) services and a cable Internet trial as part of its new Broadband Business Services. Kathleen Earley, president of AT&T's Internet Services group, discussed these and other initiatives in an interview with PC Week Senior Executive Editor/News Rob O'Regan at last week's NetWorld+Interop conference in Atlanta.
PC WEEK: Let's do a reality check: What's the risk for a business to make a commitment to DSL or cable at this time?
EARLEY: I don't think there are any risks. It really depends on the application. If they're trying to serve a mission-critical application that's on a 56K-bps link today, going to a [144K-bps] DSL connection or the cable modem connection -- even without quality of service -- is going be so far superior to what they're living with today. So depending on the business need -- the remote worker, teleworkers, dynamic extranets, VPNs -- there is no risk at all.
If you're talking about running your payroll applications and your accounts receivable and cash flows on this technology before you run your teleworkers [on DSL or cable], we'd question the sanity there.
We see this as an evolution. The next step customers are going to ask for is quality of service. But that won't be here until we get some technologies deployed that are still in the innovative phases today.
PC WEEK: So you're not suggesting that customers throw out their private lines or established frame relay connections?
EARLEY: No. We don't see old networks going away. I haven't been on a customer visit yet where customers are focused on throwing out old networks. Customers are focused on building new applications and new revenue streams. What they want to do is get productivity improvements out of [legacy applications and networks].
PC WEEK: Will there be a gradual migration off the old networks?
EARLEY: Over time you will absolutely see that happen, from a customer point of view as well as from a network company point of view. We see being able to collapse almost all of our networks onto an IP-based infrastructure over time.
PC WEEK: Is pricing [for DSL and cable services] at a point where it makes it easy to rationalize to get the better performance?
EARLEY: We're in a supply-constrained environment and our customers are in a supply-constrained skills environment.
PC WEEK: What about security for DSL?
EARLEY: VPNs [virtual private networks] over DSL right now are available on a do-it-yourself basis with IPSec clients and tunneling from the customer server to the client software. As we deploy this and start to get quality of service, there will be an opportunity for a service-provided VPN.
PC WEEK: When will we see service guarantees for DSL?
EARLEY: We're not prepared, nor is the industry prepared, to give service-level guarantees today. But we clearly understand that's where it's headed, and that as you roll out the market trials and get your back-office OSS [operations support systems] connected between service providers, then we'll be in a position to offer it.
But today, [even without service-level agreements], DSL and business cable service will be infinitely better than some of the dial services [customers] have been dealing with.
PC WEEK: With the technology evolving as rapidly as it is, is it safe for a company to make a commitment now to DSL or cable modems?
EARLEY: With the DOCSIS [Data Over Cable Service Interface Specification] standard I would hope part of the work is going to be able to have feature evolution. In terms of DSL access, there will be DSL-specific modems for different speeds. Some will be software-upgradable, some won't. We'll have to make customers understand which ones are and which ones aren't, and that will be based on the price/performance of the service. Customers are going to want to pay attention to that in the DSL area.
PC WEEK: Will most of your early customers want ownership of the DSL equipment or will they want you to manage it?
EARLEY: It always goes back to the mindset of the IT department. If you have a really strong CIO who only cares about control and isn't into out-tasking, they'll make all the decisions themselves. For smaller companies, they only care about service. I can perceive they would want leasing options so they can upgrade and just write the hardware off for the life of the contract.
PC WEEK: Who do you see as the early adopters -- mostly small businesses just getting started or big businesses looking to hook up their telecommuters?
EARLEY: We see both. Our market trial customers beating down our doors are some of the Fortune 10. They're tackling things like, "I've got ... 1,000 employees that can work at home, you tell me [whether] I serve them on DSL or cable."
You have other customers who are pushing all of their training for employees to the Web. Those customers are moving to DSL because they need symmetric bandwidth for training and also for remote LAN access.
Then there are the small, innovative companies, the ones that are built on a virtual company concept, and they're all incredibly technology-savvy.
So we see an across-the-board spectrum of customers.
PC WEEK: How far into the application outsourcing market do you plan to go?
EARLEY: For AT&T Internet Services, we can be world class at co-location services and what I would call remote hands management -- the lights are on the server, the operating system is functioning. Anything above that layer -- where you start to get into application performance, systems performance or systems integration, where now you have to worry about a Web hosted site and how it's connected to a back-end database, to the inventory management system -- that's where we'll work with partners.
PC WEEK: So you don't have any interest in becoming a service provider for things like ERP or human resources.
EARLEY: To the extent that we have relationships, we will host it in the network, and we will work with VARs who customize it. But I'm not going to move my business model to charging you for client software.
AT&T will have what I will call communications-centric applications or plug-ins, like fax services, voice services, e-mail.
PC WEEK: What was your purpose in lending support for StarOffice? (Earlier this month, AT&T announced support for Sun Microsystems Inc.'s initiative to license its newly acquired office suite to application service providers.)
EARLEY: We can put StarOffice inside the network on a Web server inside a hosted data center. Think of a customer who puts their content inside the network, and they want portions of their Web site application attaching to executable code, like a [presentation graphics or word-processing document]. If they have a dynamic extranet and somebody comes to their Web site, that end user doesn't have to have the same software.
PC WEEK: If Microsoft is serious about doing something similar with Office, would you work with them on it?
EARLEY: Yes, I want to put it in the network, absolutely. We were one of the first to work with Microsoft on FrontPage, which was tightly integrated into our shared hosting environment, and we became one of the largest distributors early on because of that.
PC WEEK: Can you give me some more detail on your plans for rolling out intelligent content distribution services?
EARLEY: Caching will be important as a service for business customers who want to ensure that the end user experience of their content is optimized. We will move the most frequently accessed around the network and keep it refreshed. There's also mirroring -- replicating the content in total -- and load balancing.
PC WEEK: Does Novell play a role here?
There are a number of people who are the leaders in the caching technologies -- Akamai, Inktomi, a new company called Adero and Novell. We're evaluating all of those capabilities but we're not ready to [choose one]. There will be different forms of caching. We may need to deploy multiple caching technologies.
PC WEEK: You've been working closely with Novell on NDS [Novell Directory Services] -- what role will the directory play here?
EARLEY: Directory services are very important because directories are how you find anything. As you move to quality of service, directory services will evolve to provide permissions if you will for certain streaming of data.
PC WEEK: Are you locked into one directory?
PC WEEK: Do you need to be?
EARLEY: No. Directory services for finding network elements and services may be very different than the network directory that an end user sees as they're getting phone numbers and addresses and things like that, which yet again could be very different than the kind of network directory deployed when you start doing quality of service. Then there's the whole directory around VPNs. Those are all very different instantiations of directories.
PC WEEK: So you don't buy into the metadirectory concept.
EARLEY: All directories will be hierarchical and they will at some point have to have handoffs. I see it as a very decentralized approach. Just as directories grew up around LANs and databases, the same thing's going to happen.
PC WEEK: What areas do you see as strategic that you haven't gotten into yet?
EARLEY: What we announced today - DSL and business cable - almost completes the portfolio of what I will call ubiquitous access. AT&T plans to differentiate itself on broadband and ubiquitous access methods, whether it's DSL, cable or wireless.
The other part of the announcement today -- hosting and intelligent content distribution -- is the crowning touch on the strategy. What we announced today are the elements of a global strategy. There's a huge opportunity here.
PC WEEK: The broadband phone you showed today - you said that was just a concept device.
EARLEY: None of us are going to sit here and say broadband phones are going to outsell PCs connected to the Net in the next three years. The point is that with broadband, there is a whole new generation of devices, whether it's Palm, broadband phones, sub-$1,000 PCs, PocketNets -- that will be fabulous. You'll see devices that are tied to applications initially.
PC WEEK: Are the devices the last piece of the puzzle?
EARLEY: No, the applications are. The devices come before the applications, and the applications drive the evolution of the devices. The devices we showed today were prototypes to get people thinking about the innovation, but the real power is how businesses use the application.
PC WEEK: Summarize your strategy for the next six months.
EARLEY: Execute, execute, execute.