1. Business applications of telecommunications with a
focus on Internet technologies.
2. Examples of Internet, intranet and extranet
3. Basic components, functions and types of telecom
networks used by businesses.
4. Network hardware, software, media and services.
Industry Trends: More competitive vendors, carriers and
network services accelerated by deregulation and the growth of
Technology Trends: Extensive use of the Internet, fiber optic and
wireless technologies to create high speed networks for voice, data,
images, audio and video communications.
Application Trends: Pervasive use of the Internet, enterprise
intranets and interorganizational extranets and enterprise
collaboration in local, national and global markets.
No Field In the World Offers
More Promise Than the Twin
Technologies of Computers and
Just like computers, telecom networks
have both a technical and a business
Combination of Computers and
• Provides the ability to process data and
access it both locally or remotely.
• Makes the combination of computers and
telecom networks a powerful resource.
1. Data Capture
2. Indexing and Defining the Data
5. Access and Retrieval
7. Data Presentation
What Is Telecommunications?
A Large and Important Industry.
Based on what you measure, it is the largest
industry in the world in terms of annual revenue.
A race with the Petroleum Industry based on the
cost of crude oil.
Ask yourself, will you use more petroleum products
or more IT in the future? 7
The transmission of signals over distances,
including not only data communications but
also the transmission of images and voice
messages using radio, television, and
other communications technologies.
Telecom Networks Open Up Entirely New Ways
of Thinking About:
The mission of telecommunications is to provide
effective and efficient electronic movement of
ALL forms of information between various
combinations of people and business equipment.
It must support business strategies and the ability
to deal with growth and changes in the business
A Necessary Perspective
The Internet is a network.
It is in fact a network of networks.
A network is not necessarily the Internet.
Jack Callon’s List of Important
• Direct Business Model
• Extended Enterprise
• Supply Chain Management
• Reengineering Business Processes
• Managing Change
Information Systems Focus
Information Systems has become enterprise-wide
through a logical, broad scope systems analysis.
1. Driven by the needs of those that run businesses.
2. Made possible through improved IT
3. Made possible through the ability to conceptualize
an enterprise-wide system.
What Are Telecom Networks?
• A Critical Business Resource.
• An Increasing Number of Voice and
Data Products and Services.
Linking Users to Information within Applications on
• Public BUSINESS
• Private ENTERPRISE
•Images •Multi-media 15
Telecom Network Challenges
• Connectivity and Compatibility.
• Performance (Processors, Bandwidth,
• Control (Management).
• Ease of Use.
A good understanding of the requirements are
necessary in determining the telecommunication needs
of the organization and in the design of the network.
UPS Versus FedEx: Playing Catch-Up in
“Information about the package will soon be just as
important and the delivery of the package.”
Frederick W. Smith, CEO
“Information about the package has become as
important as the package to be delivered.”
Oz Nelson, former CEO
The Business of FedEx?
Air Freight Short Haul
Ground Delivery Long Haul
We ship the world’s most important packages!
If this was not true, our customers would not pay our premium
If you don’t care when your package gets there or where it is
in the delivery process or when it was delivered or who signed
for it then send it via the US Postal Service or anyone else.
The Business of FedEx
The time sensitive air express business.
As an extension of this business they are also in the logistics
Callon’s 1996 Predictions
1. Growth and significance of the Internet.
2. Growth and significance of Groupware.
3. Growth and significance of integrated
Intel Internet Definition
The Internet is a global web of networks and
It connects people to people, businesses to people
and businesses to businesses.
The Internet is a network of networks.
It is a good example of how agreed upon
standards can truly work in a network-based,
inter-organizational information systems world.
Is it time for optimism or pessimism?
If there was unjustified euphoria in 1998 and
1999 has the pendulum swung too far the other
way as we progress into the future?
Internet Market Opportunities
Market Segments Browser Internet Content Internet
(Access Points) Companies Providers Providers Providers
Enterprise Microsoft AOL Movie Consultants
Intranet Netscape AT&T Producers Systems
Extranet Etc. Yahoo Integrators
Medium Company Newspapers Software Co
Intranet, Extranet Other Book
Small Company Publishers.
A Logical Thought Process
Conducting business on the Internet.
Doing business with the right vision, strategy,
tactics and business plan.
Doing business with the right vision, strategy,
tactics and business plan and utilizing the Internet.
Telecom Business Applications
1) Internal Business Applications
2) Enterprise Collaboration
3) Electronic Commerce (B2C and B2B)
Value of Telecommunications
Helps a company to overcome:
1) Geographic barriers--Anywhere in the world
2) Time barriers--Different time zones, different
time windows to do things
3) Cost barriers--Avoid need for physical presence
with an electronic presence
4) Structural barriers--Internal to a specific
company or with vendors and/or business partners.
Telecom Network Challenges
TC Business Criteria
• Phaseable (incremental)
• Available (is there when needed)
• Reliable (works the way it is supposed
• Manageable (you know that it works)
• Maintainable (can fix problems)
How Important is Speed?
Do customers really value faster response?
Does a reduction in time lower costs or
improve quality of products or services?
Does speed free up resources: employees,
business processes, operating equipment or
other business assets?
Roadmap to Understand Networks
• Start where it started--with the telephone system.
• Contrast analog versus digital.
• Understand why digital has won the battle.
• Identify major components of networks.
• Distinguish between Local Area Networks (LANs)
and Wide Area Networks (WANs)
• Use the Internet as an example of a network.
It all started with the telephone system.
March 10, 1876 - Alexander Graham Bell uttered the
first words ever transmitted over the telephone,
“Watson, come here, I want you.”
He also had an important vision that his invention
would become “a grand system, whereby a man in one
part of the country may communicate by word of
mouth with another in a distant place.”
Bell faced four challenges to make his invention a
technical and business success that remain today.
1. Achieving successful transmission and reception of
messages over distance. (amplifiers or repeaters)
2. Overcoming the blocking factor. (switch utilization)
3. Media utilization so that more than one message could be
transmitted at the same time. (multiplexing)
4. System globalization. (standards)
Telecom Network System
• Numbering System (telephone numbers)
• Signals (analog or digital)
• Traffic (voice message load is minor compared to
• Routing (switching through the network)
• Transmission (i.e. packet switching)
• Management and maintenance (test signals, etc.)
• Administration (including customer billing)
Subscriber Local Central Office
Long Distance Lines
Handset Loop Switch
PBX = Public Branch Exchange
Needed: Data Transmission
First regular data transmission--US Army in 1936.
Businesses commonly doing data transmission in mid-1960s
Data folks looked around and obviously found the existing
telephone network that spanned both the US and much of the
Dealt with the analog/digital issues with modems.
Dealt with the reliability issues with transmission verification
Complained about bandwidth problems and cheered the
implementation of fiber optics as network media. 38
What is a Telecom Network?
• Nodes and Links • Transmission Modes
• Network Structure • Message Formats
• User Devices • Carrier Services
• Media • Network Management
Types of Networks
Local Area Network (LAN) – within the
boundaries of a company building or
Wide Area Network (WAN) – across the
city, state, country or world.
Local Area Network
• Connect computers in a limited area.
• Use a variety of telecommunications media.
(twisted pair copper wire, coaxial cable, fiber optics)
• Each computer has a network interface card and
• Multiple LANs can be connected through the use
of bridges or routers.
Ring, star and bus topologies
• LAN radio with high frequency radio technology
similar to digital cellular or low frequency radio
• Infrared technology uses infrared beams of light
to establish a link between LAN components.
Benefits of a LAN
• Share common data among employees within
a department or company.
• Share peripheral equipment like printers,
plotters and storage devices.
• Minimize the cost of desktop devices by sharing
the above devices.
• Serves as the foundation for Internet attachment
within an organization. 45
• Identifying how to use an Intranet to meet business goals?
• Determining how an Intranet will impact the current
• Deciding if existing technologies can be reused.
• Determining the requirements for content management?
• Integrating existing applications and legacy data?
• Protecting the Intranet from outsider entry?
• Determining what centralized functions will be required?
• Deciding how to support an Intranet?
• Determining the operational requirements (additional MIS
staff and organizational structure)?
Significance of WANs
The foundation for most, if not all, significant
• Federal Express package routing system
• American Airlines reservation system
• Amazon.com E-Commerce system
• Visa International payment process system
• Any application system that is based on the
There are a significant number of network services
available from multiple shapes and sizes of organizations.
Some of the service providers are obvious as they have been
in the voice communication business for a long time and it
was a logical progression for them to add data services to
their product line.
The packaging of network services can range from contracting
for the entire responsibility to a vendor (outsourcing) to simply
buying network services and paying for what you use while
managing it yourself.
Network Service Vendors
AT&T Not to be confused
MCI equipment companies:
The Internet Revolution
Has become a key platform for information,
business applications and entertainment services.
Internet technologies have become the primary
telecommunications technology drivers.
Internet Historical Perspective
Why did the typical user not hear much about
the Internet until about 1985?
1. The Internet is free!
2. The Internet is free because the federal government
subsidizes the backbone.
3. The Internet is the only major national and international
4. Electronic commerce is a new innovation made possible by
5. Little retailers based on the Internet will drive their big
rivals out of business.
Making Money on the Internet
1. Sell things for money.
2. Charging customers a fee—subscription or
3. Selling advertising on your web page.
Not to be confused with saving money on the
Internet and/or using it as a way to communicate
to a wide range of people. 54
A blueprint that depicts how future
systems will be designed and built.
The various systems components are
explicitly defined so that multiple people
can build systems around the same
Information Systems Architecture
BUSINESS AND INFORMATION
• INFORMATION SYSTEMS ARCHITECTURE
• OPEN SYSTEMS
VENDOR HARDWARE AND
• APPLICATION FUNCTION
• EASE OF USE
• SEAMLESS AND TRANSPARENT 57
Open systems are common standards for hardware,
software, applications and networks.
Open systems provide greater connectivity. This enables users to
have access to many different applications on different kinds of
hardware, software and databases.
Software knows as middleware is used to help diverse
systems to work together.
Open Systems Environment
Other Services 1. Operating
3. Database System
5. Software Development Tools
4. User 6. Systems 2. Communication
Interface Management Services
Figure 11-4 59
Client Server Computing
“The Best of Both Worlds!?”
• Better Performance
• Shared Data
• Easier to Use
• Sense of Ownership
• Good Modularity (expand and contract)
• Applications Implemented Faster
• More Cost Effective
We Live in a World of Standards
In every day life we are surrounded by
standards that we probably take completely for
It is debatable if there is an area where standards
are more important than in telecom networks.
Voice and/or data communication is not practical
or even possible unless everyone plays by the
What is a Standard?
An established or widely recognized model of
authority or excellence.
Something regularly and widely used.
A basis for comparison; a reference point
against which other things can be evaluated.
IT Standards in Practice
ASCII versus EBCDIC
Ethernet versus Token Ring LANs
Windows versus Mac OS versus Linux
Twisted Pair Wire Categories
Equipment Electrical Plugs
Why are Standards Needed?
The lack of standards prevents/hampers the use of
data communications, increases costs, and reduces
efficiency and effectiveness.
In other words, standards make data
communications possible, and a lot easier.
Types of Standards
» Wiring, plugs, etc.
Not necessarily the same brands, but able
to perform the exact same procedures.
» Quantitative restrictions
Possible Standards Scenarios
1. Proprietary and Closed.
2. Proprietary and Published.
3. Open and Published.
The OSI Model
Data Link Layer
What is the OSI Model?
OSI = Open Systems Interconnection
Developed by the International Standards
Organization (ISO) based in Geneva, Switzerland.
Divides data communication functions into 7 layers.
Serves as a standard model for network architectures.
Promotes the development of modular network
Assists the development, operation, maintenance and
use of complex telecom networks.
The Seven Layers of the OSI Model
Application - provides communications services for end user
Presentation - provides appropriate data transmission and codes
Session - supports the accomplishment of telecommunications
Transport - supports the organization and transfer data between
nodes in the network
Network - provides appropriate routing by establishing
connections among network links
Data Link - supports error-free organization and transmission of data
in the network
Physical - physical transmission of data on the
telecommunications media in the network
Transmission Control Protocol / Internet Protocol
– Telecom protocols used by the Internet.
– Equivalent to a network architecture.
Application / Process Layer
Host-to-Host Transport Layer
Media – Twisted pair wire, coaxial cable, fiber
Devices – Modems, multiplexers, switches,
Software – Network operating systems
Signals/Channels – Analog/digital
Network Topology – point-to-point,
Network Hardware and Software
(2) (3) (4) (5) Telecommunications
(1) Network Management Program
• Controller Backbone
Attach Front End Database Management
Workstation • Server Processor
•Network Computer (NC) Access Method
* Channel Attach
Conducted Media Radiated Media
Electrical Conductors Radio Frequency
Coaxial Cable Microwave
Light Conductors Light Frequency
Fiber Optics Infrared
Media Selection Criteria
• Cost • Security
• Speed or Capacity • Distance
(Bandwidth) • Environment
• Availability • Applications
• Expandability • Maintenance
• Error Rates
PBX (Computer-like) Applications
1. Voice mail.
2. Automated Call Distribution (ACD)
3. Least cost routing
4. Call detail reporting
Integrated Voice/Data Application
Property and Casualty Insurance Company Claims
Customer telephone call is transferred to claims representative
along with data record history of their account and the current
Customer claim cannot be approved by service representative.
Don’t want to ask the customer to start all over in discussing
the issue with the claims department manager.
System allows the transfer of the telephone call and the data
records simultaneously along with keyed comments from the
service representative to the claims manager.
PBX Versus a Computer
Processor yes yes
Memory yes yes
Software yes yes
Storage Device yes yes
Input/Output Units ports I/O units
A Final Telecommunications Perspective
Objective Voice Data
Voice Message Transmission
Efficiency Volumes Volumes
Voice PCs and
Effectiveness Applications App. Packages
Competitive Voice Applications Systems
Advantage plus linkage Linkage
Integrated Voice/Data Applications
Voice over IP--if data dominates telecommunications
traffic why not use a data link to send voice messages.
As bandwidth improvements continue and competition
heats up, you could receive free long distance service if
you sign up for other telecom services.
• Increased importance of networks
• Wider range of reach
• Fewer standards
• Networked computer model
• Increased bandwidth
• Increased message volumes and size
• More IT options from more vendors
Telecommunication networks provide effective and
efficient movement of all forms of information.
Telecom as an IT tool is an increasingly important resource
that directly impacts the efficiency, effectiveness and
competitiveness of a company.
The Internet is playing an increasing important role in the