The Telecommunications Revolution

Telecommunications is communication of information by electronic means, usually over some distance. The current telecommunications revolution includes rapid changes in technology and equally important organizational changes in telecommunications services. For most of the time since the invention of the telephone in 1876, the industry has been made up of state-owned or regulated private monopolies, but AT&T's monopoly in the U.S. ended in 1984.

Recently, deregulation and the marriage of computers to communication has produced the information superhighway, an array of high-speed national or worldwide digital telecommunications networks that can be accessed by the general public. The information superhighway delivers information, education, entertainment and services to offices and homes, and some believe its impact will rival what railroads and real highways did to society in the past.

Deregulation of telecommunications means that organizations do not need to rely on the telephone company for telecommunications services and devices. Even more important, competition has resulted in many innovations that might not otherwise be available, and more innovation should follow. Organizations can now choose from many different companies and services selling different telecommunications services and equipment. To use telecommunications wisely, organizations must first understand the many business uses of the technology. They must develop expertise in telecommunications and may need to employ their own telecommunications specialists. Managers must know alternative telecommunications technologies and systems and the costs, benefits, and capabilities of various technologies, as well as a method for determining the organization's telecommunications requirements.

A telecommunications system is a collection of compatible hardware and software arranged to communicate information from one location to another: it can carry text, images, audio or video. The essential components of such a system are computers, input/output devices, channels, processors, and software. Channels are links such as telephone lines, fiber optic or coaxial cables, and wireless transmission. Processors are devices such as modems or multiplexers that support communication.

The principal functions of all telecommunications systems are:

• Transmission of information;
  
• Establishing an interface between sender and receiver;
  
• Routing messages along the most efficient path;
  
• Processing information to get the right message to the right receiver;
  
• Checking and editing transmitted information for errors and formats;
  
• Converting messages from the speeds and codes of one device to those of another; and
  
• Controlling the flow of information, routing messages, and maintaining overall network structure.
  

Because a telecommunications network can include diverse components, there must be a common set of rules, called protocols, to enable them to "talk" to each other. The main protocols are to identify each device, to get the other device's "attention," to verify receipt of data or the need for retransmission, and to recover from errors. There is not yet a universal standard in effect.

Electronic signals in a telecommunications network can be analog or digital. An analog signal is a continuous waveform that passes through a medium, often used for voice communications. A digital signal is a discrete waveform used for data transmission that codes data as a series of "on" or "off" bits. If digital signals have to be sent along a system that is set up for analog communication, a device called a modem must be used. A modem (abbreviated from MOdulation/ DEModulation) is a translating device that can convert signals from digital to analog and back

Channels, or the links by which voice or data are transmitted between devices, can use different kinds of wire, fiber optics, or wireless transmission. High-speed media are more expensive but can be cheaper per bit. Twisted wire -- pairs of copper wires used mostly for analog voice signals but also sometimes for data -- is the oldest medium. Coaxial cable is thickly insulated wire, often television, that is faster and more interference-free than twisted wire, but it is more expensive and harder to install. Fiber-optic cable consists of thousands of tiny clear glass fibers no thicker than a human hair. Data, sent as pulses of light, travels very fast. Although fiber-optics is more difficult to work with and expensive than other media, telecommunications carriers are building purely optical networks to provide high-capacity transmission for multimedia, voice, video, and other data-intensive information services.

Wireless transmission sends electromagnetic signals without physical connections. It includes line-of-sight microwave systems, which need stations 25 to 30 miles apart and can be expensive; traditional satellite systems, which are effective with organizations spread over a wide area; low-orbit satellite systems, which are closer to the earth and can communicate with weaker transmitters; paging systems, which can transmit simple beeps and small alpha-numeric messages to a user in the field; cellular telephones, two-way systems that use radio antennas in adjacent area called cells that "hand off" a transmission as a user moves; mobile data networks, or wireless networks that enable two-way transmission of data files cheaply; personal communications services, a developing technology that provides better service than cellular at lower power and cost; and personal digital assistants, or small, pen-based, hand-held computers with built-in wireless digital communication capabilities.

Today, common technologies for wireless data transmission include:

• Microwave-a high-volume, long-distance, point-to-point transmission in which high-frequency radio signals are transmitted through the atmosphere from one terrestrial transmission station to another
  
• Communication satellites-the transmission of data using orbiting satellites that serve as relay stations for transmitting microwave signals over very long distances
  
• Pagers-a wireless transmission technology in which the pager beeps when the user receives a message; used to transmit short alphanumeric messages
  
• Cellular phones-devices that transmit voice or data using radio waves to communicate with the radio antennas placed within adjacent geographic areas called cells
  
• Personal communication services (PCS)-a wireless cellular technology that uses lower power, higher frequency radio waves than does cellular technology and so can be used with smaller size telephones
  
• Smart phone-a wireless phone with voice, text, and Internet capabilities
  
• Personal digital assistants (PDAs)-small, pen-based, handheld computers with built-in wireless telecommunications capable of entirely digital communications transmission
  
• Mobile data networks-wireless networks that enable two-way transmission of data files cheaply and efficiently
  

Wireless communications are very susceptible to environmental interference, and require powerful error-correction abilities. When protocols become more standardized, wireless systems will become more nearly seamless.

Telecommunications transmission speed is represented in bits per second (BPS); this is sometimes called the baud rate, since a baud is the binary change from positive to negative or vice versa. Sometimes, though, the bit rate can exceed the baud rate during a transmission. The number of cycles per second a medium can send is called hertz; the capacity of the channel, measured as the difference between the highest and lowest frequencies it can transmit, is called bandwidth.

Communications processors include front-end processors, concentrators, controllers, multiplexers and modems. A front-end processor is a small computer dedicated to communications that performs error-control, formatting, editing, controlling, routing, and speed and signal conversion. A concentrator is a computer that collects and stores messages and then sends them out in economically large "bursts." A controller is a computer that supervises traffic between the CPU and peripheral devices. A multiplexer enables a single channel to carry data transmissions from multiple sources at the same time, either by dividing it into smaller channels or by assigning each transmission the whole channel for a small slice of time.

Telecommunications software controls and supports the activities of a telecommunications network. It includes network control, access control, transmission control, error detection and correction and security.

Telecommunications components can be arranged into networks of different shapes, called topologies. The three most common network topologies are the star, bus and ring. A star network consists of a central host computer connected directly to a number of other computers or terminals. All communications must travel through the host. A bus network links a number of computers by a single circuit; all signals are broadcast in both directions to the whole network, and software identifies which component is to receive a message. Bus networks fail less often and are often used for LANs. A ring network links all computers by a closed loop and passes data in one direction from one machine to another.

Local networks can take the form of a private branch exchange (PBX), a central switching system for a firm's voice and digital communications. PBXs use existing telephone lines and do not need special wiring. PBXs are usually limited to small geographical areas and cannot handle large volumes of data. A local area network (LAN) is a telecommunications network that requires its own dedicated channels and also covers a limited distance. LANs generally have higher transmission capacities than PBXs -- up to 100 megabits per second -- but they are more expensive to install and maintain, and require specialized staff to run them. End users totally control LANs; they allow expensive equipment and software to be shared, and are not vulnerable to the failure of a single component. Some parts of a LAN are the server, a computer that acts as a librarian for data and software; the network operating system, which is usually contained within the server and controls it, managing and routing communications; and the gateway, which connects the LAN to public networks. The channels used by LANs can be either baseband or broadband: a baseband channel provides a single path for transmission, while a broadband channel allows transmission along several paths simultaneously.

Wide area network (WANs) can cover larger geographical distances, even entire continents. Usually, common carriers determine transmission rates and interconnections, but users establish content and manage use. User firms control routing, editing, protocols and other functions.

WANs may include switched lines, or telephone lines that a user can access with the call being routed through paths to its destination, or dedicated telephone lines that are continuously available for a flat rate and usually transmit at high speeds. Dedicated lines are more appropriate for higher-volume transmissions. In some cases, individual businesses may operate their own WANs.

Value-added network (VAN) are private, multipath, data-only, third- party-managed networks used by multiple organizations on a subscription basis. They can provide economies in the cost of service; of data transmitted plus a subscription fee. The "value" comes from not having to buy network equipment or software. VANs also provide economy through packet switching, which breaks blocks of text into small bundles of data and routes them in the most economical way through any available channel. One variant of packet switching is frame relay, which is cheaper and faster because it does not use error correction routines. Another technology, asynchronous transfer mode (ATM), parcels information into eight-byte "cells" that can be transmitted between computers from different vendors at any speed.

Telecommunications has accelerated production and decision-making by reducing barriers of geography and time. Some of the leading applications of this technology are electronic mail, voice mail, facsimile machines (fax), digital information services, teleconferencing, dataconferencing, videoconferencing, electronic data interchange, and groupware.

Electronic mail, or e-mail, is the computer-to-computer exchange of text messages. They can be sent over internal networks or commercial online services. E-mail systems are not very secure because they are vulnerable to eavesdropping. Voice mail digitizes spoken messages, transmits them and stores them for later retrieval. The messages can be manipulated by the sender or the receiver. Facsimile (FAX) machines transmit hard copies of documents containing text and graphics over regular telephone lines.

Digital information services enable networked users to get information from outside the firm instantly: stock prices, historical records, catalogs, news, weather, and so forth. Teleconferencing is the ability to confer with a group of people simultaneously using the telephone or e-mail.

Dataconferencing allows two or more users at distant locations to edit and modify data files at the same time. Videoconferencing is teleconferencing with the addition that participants can see each other over video screens. It usually requires special rooms set up with the necessary devices. Inexpensive PC-based desktop videoconferencing systems where users can see each other and work simultaneously on documents are now becoming available. These technologies are growing in popularity because they save travel time and cost.

Electronic data interchange (EDI) is the direct computer-to-computer exchange between two organizations of standard business transaction documents. As opposed to an unstructured transmission like an e-mail letter, EDI sends structured transactions with distinct fields. It lowers transaction processing costs and saves time by eliminating hard copy forms. But to work properly, it requires transaction standardization translation software and mailbox facilities. It also faces legal restrictions, since many transactions require written signatures to be legal.

Organizations have also enhanced productivity by using communications technology for distance learning and e-learning programs where employees can be trained in remote locations without being physically present in the classroom. While distance learning can use both digital and print-based materials, e-learning delivers instruction using purely digital technology.

Ultimately, Chapter 8 closes by focusing on the business value of much of this technology, as it discusses electronic commerce and electronic business technologies and ties them to telecommunications. Both technical staff and the business management personnel need to understand this material. Telecommunications and networks are vital to most businesses today, and this chapter helps to explain why. Spend time trying to fully understand this material.

New Information Technology (IT) Infrastructure for the Digital Firm

A new information technology infrastructure is required to coordinate the activities of entire firms and entire industries. The new information technology (IT) infrastructure uses a mixture of computer hardware supplied by different vendors, including mainframes, PCs, and servers, which are networked to each other. More processing power resides on the desktop through client/server computing and mobile personal information devices that provide remote access to corporate systems from outside the organization. The new information technology (IT) infrastructure also incorporates public infrastructures, such as the telephone system, the Internet, and public network services and portable electronic devices.

Connectivity is a measure of how well computers and computer-based devices can communicate with one another and "share" information in a meaningful way without human intervention. It is essential in enterprise networking in the new information technology (IT) infrastructure, where different hardware, software, and network components must work together to transfer information seamlessly from one part of the organization to another. Connectivity is also required to achieve internetworking, the linking of separate networks, each of which retains its own identify, into an interconnected network such as the Internet.

Transmission Control Protocol/Internet Protocol (TCP/IP) and Open Systems Interconnect (OSI) are important reference models for achieving connectivity in networks, with TCP/IP providing the reference model for the Internet. Each divides the communications process into layers. UNIX is an operating system standard that can be used to create open systems as can the Linux operating system. Connectivity also can be achieved by using Internet technology, XML and Java. Bluetooth and 802.11b (also known as Wi-Fi) are two emerging connectivity standards for small wireless networks.

No one owns or formally manages the Internet. Participating networks must pay a small fee, adhere to TCP/ IP (Transmission Control Protocol/ Internet Protocol) and agree to forward other systems' data traffic. Users make local phone calls to their local networks, making costs very low.

The Internet is based upon client/ server technology. All the data, including e-mail messages, databases and Web sites are stored on servers. Servers dedicated to the Internet are the heart of information on the Net. Major Internet capabilities include e-mail, Usenet newsgroups, LISTSERVs, chatting, Telnet, FTP, gophers, and the World Wide Web.

Usenet newsgroups are forums in which people share information and ideas on defined topics. There are more than 16,000 of these groups, and people can post questions or comments of their own or just read other people's entries . LISTSERVs are discussion groups using e-mail mailing list servers instead of bulletin boards for communication. Chatting allows people who are on the computer simultaneously to have live, interactive conversations. Telnet is a network tool that allows people to log onto one computer system while doing work on another.

A second basic Internet function is information retrieval. Library catalogs, databases, film reviews, even weather photos are available on-line. Users can read the data while connected, or often can download it for later reference. People can get free software over the Internet as well. File Transfer Protocol (FTP) is used to retrieve and transfer files from a remote computer. A gopher is a client/ server tool that lets a user locate all on Internet gopher servers using a system of hierarchical menus.

The current Internet is no suited for transmitting high-bandwidth applications requiring immense quantities of data. Internet2 and Next Generation Internet are research networks with new protocols and transmission speeds that are much higher than the current Internet. These research networks will lay the foundation for a new high-capacity Internet with the reliability and bandwidth to distribute data-intensive applications using sound, graphics, and video.

People who offer information over the Web must establish a home page a text and graphical screen display that welcomes the user, explains the organization and usually leads to other pages. All of an organization's pages together make up a Web site. The most dramatic aspect of the Web is the combination of text, graphics, sound, and hypermedia. The Web uses Hypertext Markup Language (HTML) to format documents and incorporate dynamic links to other documents stored on the same or remote computers. Using these links, one can be transported to another Web document by pointing and clicking on a highlighted keyword or graphic.

To use the Web, one must have a graphics computer linked to the Internet, and a software tool called a Web browser.

The Internet's information retrieval capabilities are powerful-- but because the net is decentralized, the main problem is finding what you need when vast stores of data exist in machines all over the world. The methods of locating information on the Web are Web site directories, search engines, and broadcast or "push" technology.

Web site directories such as Yahoo! maintain classify Web sites and their addresses based on specified categories. Search engines such as AltaVista or Lycos to do not require Web sites to be preclassified and feature software that looks for Web pages containing one or more of the search terms entered by the user. "Push" technology broadcasts relevant Internet information directly to the user based on prespecified interests.

Companies can create internal networks called intranets which are based on Internet technology. The intranet uses Internet connectivity standards and Web technology so that network applications can run on many different kinds of computers throughout the organization. The intranet is private and is protected from public visits by firewalls -- security systems with specialized software to prevent outsiders from invading private networks. Some companies have made their intranets accessible to authorized outsiders, such as suppliers and business partners. Private intranets provide limited access to select outsiders are called extranets.

Web content is being reformatted for wireless devices such as Internet-enabled cell phones, PDAs, and other digital appliances so that people can access Internet information resources from mobile locations. Wireless Web applications enable mobile users to access digital information from the Internet using specialized portals for wireless devices. M-commerce applications based on instant messaging, e-mail, and location-based services appear the most suitable for wireless Web technology. The two main standards for wireless Web technology are Wireless Application Protocol (WAP) and I-mode.

Many organizations use the Net to reduce communications costs when they coordinate organizational activities and communicate with employees. Communications costs go down on the Net because companies do not have to establish their own wide-area networks (WANs) or pay Value-Added Network (VAN) VAN fees.

With Internet telephony (also called IP telephony) companies can also use the Internet for telephone voice transmission. Companies can also use Internet services to create virtual private networks (VPNs) as low-cost alternatives to private networks. A virtual private networks is a secure connection between two points across the Internet for transmitting corporate data and is available from Internet service providers (ISPs). Researchers and knowledge workers are finding the Internet a quick, low cost way to both gather and disperse knowledge.

Support Technology for Electronic Commerce & Business

Businesses need a series of software tools for maintaining Web sites for electronic commerce and electronic business. Web server software locates and manages Web pages stored on Web server computers. Electronic commerce server software provides capabilities for setting up electronic storefronts and arranging for payments and shipping. Customer tracking and personalization tools collect, store and analyze data on Web site visitors. Web content management tools facilitate the collection, assembly and management of Web site content. Web site performance monitoring tools monitor the speed of Web site transactions and identify Web site performance problems. Businesses can use an external vendor's Web hosting service as an alternative to maintaining their own Web sites. Web hosting services offer solutions to small companies that don't have the resources to operate their own web sites or companies that are still experimenting with electronic commerce.

Solutions include planning for and managing the business and organizational changes associated with enterprise-wide computing, increasing end-user training, asserting data administration disciplines, and considering connectivity, application integration, bandwidth, and cost controls when planning the information technology (IT) infrastructure. Companies trying to digitally enable their business processes must built robust and scalable IT infrastructures with sufficient bandwidth and storage capacity for transmitting and maintaining all of the data generated by electronic commerce and electronic business transactions.

Return to top

Return to top