Under the big top at Telecom '99.

As telecom trade shows go, Telecom '99, held in Geneva October, was gargantuan. For a full week, over 175,000 people visited eight exhibit pavilions that took crews three weeks to construct. Telecom '99 is a larger format for the usual drill, where customers and vendors meet in a circus-like

Telecom, sponsored every three years by the International Telecommunications Union (ITU), provides a milestone for global progress to date and a benchmark for the future. ITU is separate, telecom-only, and not linked directly to organizations such as the World Bank, the U.N., and the World Trade Organization (WTO). The ITU (www.itu.int) is nongovernmental, and its mix of business and government members makes it, traditionally, a crossroads for key agendas.

ENTERPRISE OPPORTUNITY: WORLD TRADE

What will happen to the Internet? As access to data services and the density of hosted services pick up in various world regions, the telecommunications community will decide the Internet's future in an international context. Remember, even as voice deregulates and data booms, there are places where a one-minute phone call still costs more than the per-capita monthly wage. Findings from Telecom '99 weren't from vendor briefings but from attendee response, some of which sounded frustrated, even hostile.

For data, like voice, overcoming cost and distance is a good premise, but many developing countries are still just trying to get teledensity up and voice services to affordable levels. In a deregulating environment, many of the deregulating carriers face being whipsawed by the loss of voice revenues as inbound calls come in over IP or IP calling-card mechanisms. But recent efforts by U.S.- and European-based high-tech executives to address Internet development for other countries fail to answer the hard question: what is the value of new data-communications technology?

KEEPING IT SIMPLE

We were pulled aside at one point by execs from the "Business Exchange Service," an ITU-oversight partnership promoting the use of a simple card/key device for access to a neutral reviewer of common-root certificates. Because it's from a trusted source, it is like money; this provides the NGO equivalent of the proverbial "Swiss bank account." The program, overseen by the World Trade Centers Association, offers a centralized trade database to generate the service demand but can include certified third-party providers via Internet access.

For developing countries, this creates a low-cost infrastructure for e-commerce: any phone or device with a card, USB, or other I/O standard slot. For governments, banks, and other businesses in developing countries, its potential offers a way out of the charity abyss of telecom development--its promise is to provide a low-cost medium for business and consumers to use deregulated services and access international markets. The "BeX" service provides an extranet for the posting of catalogues, pricing, and even certified, auditable transactions. Although standardized commerce and extranet services for manufacturing, travel, government, banking, and other industries have existed for years, these are often very specialized. This is a new wave of e-commerce. The extremely low-cost, rapidly deployable mechanisms like BeX will define a global opportunity for a majority of end users.

WIRELESS APPLICATION PROTOCOL

The biggest story of the show was the wireless application protocol (WAP). As the U.S. wrangles with DSL and cable modem deployments, the international market looks right to wireless as a model for profitable growth in voice+data services. With WAP, the time has come to add not only data but full-fledged applications, including access to the Internet, via wireless.

The market for wireless Internet gateways and other applications is a ready-made, 300-million-subscriber global market today, an indicator of the importance of "third-generation" (3G) mobile services, such as WAP. Wireless+Internet is compelling in the developing world because of the speedy adoption of wireless in many countries. Figures available on ITU's Web site state that, in 1998, mobile cellular phones accounted for 72% of the telephones in Cambodia, 51% in Finland, 47% in Israel, and 46% in Hong Kong. Does this suggest a future for the Internet and IP data networks?

Wireless providers understand regulatory reform and competition, as well as the need for rapid deployment and provisioning. They founded their success on one principle: they must continuously add and bundle new applications to justify their services' value proposition. Wireless is pervasive: where other services are not available, satellite services (such as those provided on Globalstar's network) offer new, instantaneous reach to ships, calling-card stations, and handset users.

The most dramatic example of a wireless data application was "Geneva Now," which offered location-specific directory services. Want a pizza in Geneva? Take your WAP-enabled GSM-standard handset out onto the sidewalk, enter a simple inquiry, and it displays a directory service that gets you there. WAP standardizes the infrastructure needed to deliver this kind of thing, paving the way for service development. Telecom '99 was full of announcements, such as "GPRS" service management gateways and application-specific billing systems. For example, IP billing system vendor Solect announced a deal for OEMing its products through wireless behemoth Nokia as a combined service gateway for wireless application providers.

WAP and related developments are unleashing enterprise data services to a massive new market. This should benefit enterprise customers, who have internally provided their own directory services for years. Service providers have responded in the next-generation marketplace with enhancements to managed services offered internationally by companies such as GTE. With WAP, these back-end and managed services could, potentially, flourish globally, through new wireless service-provider channels. Translation: mass marketing of wireless data services will bring greater availability and lower cost.

In the U.S. especially, the Internet to date has been fueled by things at which the international market often scoffs. Geneva Now is a no-nonsense application service that looks like a model for a viable service. Sending gratuitous graphics isn't the only way to make money; all the presentation the Now service needs is an LCD display that rivals the original calculator/ watches of the '70s. In the markets of developing countries, the lowest common denominator in cost and value, long a central tenet of enterprise management, remains the most important principle. Combine a WAP service with a SIMM card or USB device for BeX certification on the back end, and you have a new meeting ground for doing business that is acceptable to the "developing" and the "developed" world.

SERVICE MANAGEMENT

A key trend we saw at Telecom '99 was the emergence of integrated services platforms--the back-end pieces of software used to manage, support, provision, and bill for services. As services move to more "shared" models between enterprises and smaller, interconnected carriers, services platforms are becoming more open, comprehensive, and customer-configurable. This is definitely something new.

Even today, networking systems vendors are selling things in the "old way," offering chunks of hardware and software--and, over recent years--pushing bundled elements like network management, security, and other service configurations. We're seeing a customer pull to consolidate resources for billing, provisioning, service configuration, and network management. Various pieces are viewed together as a bundle that is more flexible and cost-effective in supporting multiple services.

Until recently, the majority of services and equipment companies, including those outside the U.S. domestic market, saw the U.S. as a proof of concept for any new technology or service. With significant international business in telecommunications, the Internet has changed the stakes for everybody. Smaller enterprises must play; more, and smaller, services companies are involved. The incentive is the creation of a global business medium that reaches billions of companies and the availability of better outsourced services. The result is that the telecom needs and methods of the developing world are fast becoming synonymous with our own.