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It sounds like science fiction but it is not.  VOIP is to be legal in South Africa soon!  We explain what VOIP is and why Telkom might be feeling the heat of photon torpedoes aimed directly at it's tailpipe.
 

I knew I needed help when about two months ago, the SciFi channel ran Star Trek episodes back to back, 24 hours per day.   No commercial breaks - just trekkie eposide after trekkie eposide.  It was bliss.  Sleep and toilet breaks were optional.  The Klingons were on the starboard bow...and closing fast.

Then the channel closed down permanently.  Life lost meaning.  No photon torpedoes slamming into Borg ships to cheer me up three o'clock in the morning.

I was devastated until the minister of communication went where no South African minister of communication has ever gone before: she announced that as from 1 February 2005 VOIP will be legal in South Africa.  It was such a bold and profound announcement, it reminded me of that trick Captain Picard pulled on the Ferengi...

"VOIP"? I hear you asking.  No, it's not the sound of a laser cannon slicing the vacuum of space - it's Voice Over Internet Protocol - I'll tell you more about that in a second. 

It sounds like science fiction, but it is not:  our dear Telkom is about to experience a major force field failure - and we've got two photon torpedoes lined up to their tailpipe...life's about to get very interesting! :-)

Five years ago I had a heated discussion with a colleague on whether or not the internet is useful.  He said it was too slow.  He said nobody will buy anything on it because it is too dangerous.  It's too difficult to use.  People can't even use their VCRs never mind a global computer network. 

Strangely enough Bill Gates agreed with him. 

Both of them were proven spectacularly wrong.

The most successful and powerful technologies are those that are invisible.  The lasers in your DVD player.  The GSM radio transmitter in your cell phone.  The infra red detectors in your porch light.  The quartz crystal in your wrist watch.  The transponder chip in your car keys. The hydraulics in the office lift.  The internet communication protocols.

VOIP is an invisible internet technology.  That distant rumbling you hear if you listen carefully is a very powerful but invisible revolution that signals a giant leap the internet is about to take to become the most important technology on this planet.

Who would have thought 10 years ago that billions of people would be walking around with personal communication devices with instant and cheap access to a large percentage of the world's population?  Hey?  If you walk past any tree and shake it a bit, a bunch of cell phone users will fall out - and the majority of them are not even yuppies! ;-)

My favorite science fiction writer is Peter F Hamilton (author of the "Nights dawn" trilogy).  In his books he refers to the "unisphere" - a network like the internet, only it is all encompassing and all computers and people are permanently "wired" into it.  It delivers news, email, movies, tv, instant voice communication...everything.  Every computer and every person is directly connected to every person and every computer.  Always and from anywhere. Awesome. 

The problem (for writers) is that it is hardly fiction anymore.

You better sit down and strap in because we are about to jump to hyperspace - let met tell you more about VOIP...
   

Some inventions are so simple and obvious you can kick yourself for not thinking of it first.  VOIP is like that.  It is not a conceptual break through - it is a natural progression of network technology. 

Because the South African government is making VOIP legal in South Africa, it has the potential to drive all communication costs down almost immediately - with or without the Second National Operator.

To understand why it is so important and why it has the power to change telephone costs forever, we have to look at how ineffective and costly the current phone system is before we can understand how significant the VOIP announcement is.

Circuit switching

The current ("normal") phone system uses a very basic concept called "circuit switching". 

In essence every telephone conversation consists of a piece of "wire" between both parties.  The caller phone is connected directly to the receiver's phone - in other words, it forms a "circuit" through which the electronic impulses of the conversation can flow.

Obviously one cannot connect a piece of wire between every phone user on earth, so the switching happens electronically in telephone exchanges. 

When you dial the number of another telephone, the exchanges between the two points switch lines together so that you have a point to point connection to the remote telephone. 

Once the circuit is built (switched) the lines involved in the circuit stay connected until the conversation ends.  (During this time the lines cannot be used for anything else - hence the engaged tone when you try to phone a number that is already switched into a circuit)

A telephone line (circuit) can carry (transmit) 64Kbps of data in both directions at the same time, for a total connection "bandwidth" of 128Kbps.  (There are 8 bits in a byte, therefore 128Kbps is 16 Kilobyte per second.  Data transmission is measured in kilobits because one bit represents one on/off state in a digital system.  Confused?  Don't worry - just keep concentrating on that big black Telkom tailpipe...:-)

Considering a typical phone conversation, at least half of the phone line's capacity is wasted, because while one party is talking, the other is listening.  (Unless it is a conversation between teenagers ...) 

Most conversations (even between teenagers) contains periods of silence - between words and between sentences - more wasted capacity.

If we consider all of the above, we could safely estimate that at least half of the bandwidth capacity dedicated to a phone conversation is redundant.

Packet switching

Data networks works on an entirely different principle.  They use "packet switching".  All information (email, web browsing, etc) is sliced into a number of small packets and handed to the next router for delivery to the target system.

Routers perform the same basic job as a telephone exchanges.  They route (switch) packets to the correct line, but the circuit only stays connected for less than a thousandth of a second - not for minutes at a time.

Every packet traveling on the data network is like a small envelope.  It contains addressing data (where it is going to and where it is from) and a "payload" of encapsulated data.

The first router on the path can therefore send the packet to the next router and close the connection as soon as the packet is delivered.  The second router has all the information necessary to send the packet on to the next router (or return it to the sender if it is undeliverable).

Most networks have multiple paths to get to a point.  For instance, a router in South Africa may have two or more international connections.  When it receives a packet destined for Australia it can decide to use a link via London, Washington or Tokyo.  The route it picks will depend on which of them are available (online) and which of them offers the fastest path to the target - in other words the most optimal and least used link.  One stream of data (consisting of several packets) can therefore be split over multiple connections to arrive at it's destination in the shortest possible time using the cheapest possible link.

All of this happens automatically and very, very quickly - hundreds of thousands of times per second.

Just shake and stir

From this point it is a simple conceptual jump to deduce that it would be far more effective and efficient if the phone system used packet switching instead of circuit switching.

So just convert all the circuit switched networks to packet switched networks right?  At the cost of a few trillion and 10 years later maybe - but there is a much better, simpler and faster solution:

You don't have to be Dr Spock to realize that there is already a existing global packet switching network.  It is called: (drumroll) - The Internet!

All you have to do is digitize the voice conversation (break it up into small packets) and transmit it via the internet!

Voila!  We just invented the hyper drive, er, I mean VOIP - Voice Over Internet Protocol.

Huge cost and capacity savings

If we use packet switching for voice conversations (eg on the internet), we can carry at least twice (and more) the number conversations on the same capacity as would have been possible on a circuit switched network - but lets take the concept a bit further...

Let's compress the voice data before we send it.  If we apply statistical analysis to the data, we can remove all repeating voice or silence patterns and replace them with shorter versions - in other words we can reduce a 10Kb "file" to 7Kb or less.  The device on the other side can de-compress the data and no-one would be any the wiser.  Kind of like dehydrated potatoes but much more sexy. :-)

Our circuit switched connection that could carry only one conversation can now, with packet switching and compression, carry three or more conversations for the same cost!

Let's do a little bit of math.  (Don't worry I'm allergic too - this will be quick):

Let's say that the typical phone conversation lasts for 10 minutes.  Because just one party talks at a time the amount of data to be transferred is in the region of 4.8 Mb.  Using compression, we can reduce the size of the file by about 30% - making smaller to 3.84Mb.

Using this rough estimate: On a circuit switched phone line we can carry 24 Hours of conversation in a day.  On the same line, but using packet switching and compression, we can carry 58 Hours of conversation - at the same cost.

This calculation is simplified, but I'm sure you get the point - the more capacity you have, the more cost effective VOIP becomes.  Imagine what you can save if you are running a national telephone service with hundreds of thousands of lines!?

There is just one small problem - VOIP is illegal in South Africa, and Telkom is still grinning like a ginger cat in a tub of tuna.

Long walk to freedom

A few days ago the minister of communication announced that the ban of VOIP technology in South Africa will be lifted by the 1st of February 2005.

Telkom's grin is faltering but they are not exactly sobbing uncontrollably because they too can save HUGE amounts of money by implementing VOIP. 

The problem (for Telkom) is that the lifting of the ban enables ANY licensed network operator to implement VOIP in South Africa.  This means that corporates, ISPs, SMEs - just about anyone with spare data communication capacity can provide a much cheaper phone service than Telkom - as from the 1st of February 2005!

Hold your breath, and pull the safety belts tighter because Telkom faces real COMPETITION for the first time in it's existence!

Guess who is smiling now?  I'll tell you: we are.  The South African consumer.  The previously abused ones. :-)
 

This is where the invisible technology bit comes in.

Instead of routing telephone calls via the "old" exchanges, vendors will provide "gateways" (computers) that will take your call made from a normal phone and "inject" the conversation (as data) into the internet.  A remote gateway will then pull the data off the internet and inject it back into the normal phone network.

You as the consumer will be completely unaware of the fact that your conversation was partly carried by a switched circuit network and partly by a packet switched network - it is invisible to you!  The visible and important part is that you will pay a LOT less for the call.

What is going to happen now?

You can be pretty sure that large numbers (hundreds) of vendors will jump on the VOIP bandwagon next year.  As is always the case with new technology and opportunities a number of the new vendors will be fly-by-nights and will not last long, so it is important that you do not get pulled in by the mass-hysteria.  (When the time comes and cheap phone calls are offered by all and sundry, do your homework before you select a vendor.)

It is a virtual certainty that the cost of voice calls (especially long distance) will decrease substantially next year.  Some people even think that local telephone calls may be free of charge in the near future. 

See these photon torpedoes?  See that big black tailpipe?  ;-)

Cell phone providers can also use VOIP to remove a large part of their reliance on Telkom - driving down the costs of cell phone calls virtually immediately.

It has been estimated that Telkom's high rates add about 0.5 % inflation to the South African economy.  I don't know if that is true, but one thing is for sure - using a telephone will start getting to be a lot cheaper next year!

"Unispehere" and Star Trek like personal communicators? Fiction? 

Not for long. 

Fire at will! :-)
 

Here are some quick links to CozaHost services and products:
 

 
A shepherd was herding his flock in a remote pasture when suddenly a brand-new BMW advanced out of the dust cloud towards him.

The driver, a young man in a Broni suit, Gucci shoes, Ray Ban sunglasses and YSL tie, leaned out the window and asked the shepherd:

"If I tell you exactly how many sheep you have in your flock, will you give me one?"

The shepherd looked at the man, obviously a yuppie, then looked at his peacefully-grazing flock and calmly answered, "Sure."

The yuppie parked his car, whipped out his IBM Thinkpad and connected it to a cell phone, then he surfed to a NASA page on the internet where he called up a GPS satellite navigation system, hacked into the NSA database of real time satellite feeds, scanned the area, and then opened up a database and an Excel spreadsheet with complex formulas.

He sent an email on his Blackberry and, after a few minutes, received a response. Finally, he prints out a 130 page report on his miniaturized printer then turns to the shepherd and says:

"You have exactly 1586 sheep."

"That is correct; take one of the sheep." said the shepherd.  He watches the young man select one of the animals and bundle it into his car while slowly puffing on his pipe.

Then the shepherd says: "If I can tell you exactly what your business is, will you give me back my animal?"

"OK, why not", answered the young man, grinning.

"Clearly, you are a consultant." said the shepherd.

"That's correct." says the yuppie surprised, "but how did you guess that?"

"No guessing required." answers the shepherd.

"You turned up here although nobody called you. You want to get paid for an answer I already knew, to a question I never asked, and you don't know a thing about my business.... Now give me back my dog."
    

 
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Wishing you happy, safe and productive computing - till next time.

Live long and prosper. :-)