The Wall Street Journal Europe's CONVERGENCE Supplement

Volume III, Number 4, Winter 1997 (November 17, 1997)

Internet Threat: Will Technology Trip Up the Telecom Titans?


(excerpted from p. 25)

Voicing Concern . . .
This huge shift [to Internet Telephony] is clearly known by others at AT&T. Indeed, AT&T technology specialist David S. Isenberg, a 12-year veteran of AT&T Labs, recently wrote an essay about the vast change underway. The piece of writing has found its way onto the Internet and may soon assume cult status among the tech mavens that roam the World Wide Web.

In the article, Mr. Isenberg flatly states that the basic assumptions phone companies used to invest billions of dollars to build "intelligent" networks are hopelessly outdated. The assumptions: that expensive infrastructure is scarce and will always be in demand; that voice service, not data, drives traffic growth; that circuit-switching is the technology of choice; and that a phone company should control the network. He notes that most phone companies -- presumably AT&T included -- still live by these assumptions, and continue to pump billions of dollars into making their current networks more "intelligent," and capable of services like call-waiting and caller ID.

Mr. Isenberg should know: as a member of AT&T Corp.'s "True Voice" technical team, he found that the intelligence in various parts of AT&T's network actually hampered the effort to improve voice quality. Thus, he warns: "Even as it rolls out and matures, the Intelligent Network is being superseded by a Stupid Network," i.e., the Internet, whose smarts are scattered across thousands of far-flung computers, with no central guiding hand and whose only function is to "Deliver the Bits, Stupid."

In a final scathing remark, Mr. Isenberg compares phone companies, and their efforts to finance potentially obsolete networks, to sailing merchants who "responded to the threat of steam by inventing faster sailing ships in the mid-1880s."

This insider's startling assessment suggests that if the telecom giants fail to adjust while upstarts tap the potential of the Internet, AT&T and others could find their long-lucrative lines have simply gone dead.

Date last modified: Nov 25 1997