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Packet™ Magazine Archives, Fourth Quarter 1998 ICG Netcom Partners with Cisco to Launch Bundled IP Services Integrated Voice/Data Network Brings Cost and Business Benefits to Subscribers The telecommunications industry is on the brink of a huge transformation as service providers begin building global networks based on packets rather than circuits -- a telecom convergence that lays the groundwork for a new network infrastructure. This revolution is distinguished by seamless support for voice, data, and video applications, including Web browsing, e-mail, streaming video, and telephony. ICG Netcom is at the forefront of this revolution as it rolls out voice-over-IP services in dozens of cities throughout the USA. "We're using our extensive private data network to offer multiple, bundled services to residential and business customers," says David Gandini, President of Long Distance Operations at ICG Netcom. "We've combined our public switched voice network with our data network to create truly integrated service offerings that include voice, data, and video." Headquartered in Englewood, Colorado, ICG is an integrated communications provider (ICP) offering enhanced telephony and data services to customers in California, Colorado, the Ohio Valley, and parts of the southeastern USA. ICG is also a leading designer and installer of copper, fiber, and wireless infrastructure for buildings and companies. Last year's acquisition of Netcom gave ICG one of the nation's largest ISP footprints, with 238 points of presence (POPs) nationwide. The enhanced ICG Netcom network is ideal for supporting voice-over-IP services including IP telephony, IP fax, and virtual private networks (VPNs). "We've combined a great telephony background at ICG Telecom with a great data background and ICG Netcom to become an ICP," notes J. Shelby Bryan, President and CEO of ICG. "However, our key to success transcends mere technology. Customers are the focus of our entire business and we plan to deliver services to meet their needs. We don't pay lip service to customer care -- we live by it."

"ICG is unique in the IP telephony field, not only because we have a comprehensive nationwide network to deploy the service, but also because ICG has the voice technology and operations support systems expertise to ensure that this service is successfully deployed." -- J. Shelby Bryan, President and CEO of ICG.

On the Launch Pad By listening to customers and tailoring communications solutions that exceed expectations, ICG Netcom's revenue has grown from US$600,000 in 1991 to approximately $273.4 million in fiscal 1997. According to Wall Street estimates, revenue is expected to continue to grow exponentially into the next decade. Much of that growth will be fueled by ICG Netcom's IP telephony services. These services will be delivered in a staged rollout to 166 cities this year, beginning with residential long-distance services centered at its POPs. In the near future, it will expand its service offerings to include small and medium-sized businesses as well. "ICG's IP service will be of the highest quality and will be bundled with ICG's local dial tone, Internet, and data services in many areas," Bryan says. "ICG is unique in the IP telephony field, not only because we have a comprehensive nationwide network to deploy the service, but also because ICG has the voice technology and operations support systems expertise to ensure that this service is successfully deployed." The company's IP service will cover 90 percent of the US long-distance market and be offered in nearly seven times the number of cities as any of its competitors. ICG will offer its IP long-distance service for US$0.059 per minute for calls originating and terminating on its IP network and $0.089 for calls originating on its IP network but terminating elsewhere. These rates apply to both residential and business customers. "We envisioned these IP-based services earlier this year, but we needed to find an internetworking vendor that could help us develop and promote the program," recalls Gandini. "We partnered with Cisco for its high-quality equipment, its experience with service providers, and its leadership role in pushing IP telephony technologies into mainstream use."

"Cisco is making technical strides that make IP telephony robust enough for high-quality voice services." -- David Gandini, President of Long Distance Operations at ICG Netcom.

Robust Cisco Infrastructure ICG Netcom's overriding aim is to combine bundled products -- such as local phone service, long-distance phone service, and Internet access -- with the type of end-to-end control that can only come from maintaining a private network. To allow for this type of control, ICG Netcom is purchasing more than 10,000 Cisco AS5300 universal access server ports, the voice/fax feature card for the Cisco AS5300, Cisco 7500 series routers, and Cisco's BPX® 8600 carrier-class ATM switches. These products supplement ICG Netcom's existing Cisco 7500 series routers. The combined network deployment will provide services to enhance the company's Frame Relay, Point-to-Point Protocol (PPP), and IP connectivity services and enable Internet telephony. "Cisco is making technical strides that make IP telephony robust enough for high-quality voice services," Gandini stresses. "With the prioritization and QoS guarantees built into the Cisco IOS® software, we can code our traffic so, for example, voice traffic takes priority over fax traffic. This ensures that when customers use the IP network for voice, they are receiving the highest priority and quality available. There are also tremendous cost advantages," Gandini adds. "Our IP voice service can save subscribers 20 to 50 percent over their current providers." Road to VPNs Prioritization, also referred to as quality of service (QoS) or class of service (CoS), allows service providers to provision varying service levels that utilize differentiated pricing models. For ICG Netcom, this differentiation will pave the way for voice and data VPN service offerings in the near future. "Prioritization is an essential ingredient of a VPN, because it determines the network's ability to assign resources to mission-critical or delay-sensitive applications," Gandini explains. "From a cost perspective and a quality perspective, we are managing the network for our customers. We have control of the network, which enables us to offer bundled services with multiple products on the same bill." For enterprise customers, VPNs based on IP can naturally extend corporate intranets over wide-area links to remote offices, mobile users, and telecommuters. Further, they can support extranets linking business partners, customers, and suppliers to provide better customer satisfaction and reduced manufacturing costs. Cisco IOS software becomes the foundation for deploying this broad set of VPN offerings. "We chose Cisco to help us handle these aggressive services because of its proven expertise in these areas and the reliability of its equipment," concludes Bryan. "This arrangement will make ICG Netcom's voice-over-IP services not only one of the most cost-effective long-distance solutions, but one of the highest-quality services available today."

JumpStart Joint Marketing Program for Service Providers -- The Fastest Way from Platform Selection to Services Launch Enormous opportunities await service providers who intelligently target Frame Relay, ATM, and IP-based service markets. But executing an effective services launch takes careful planning and a broad knowledge of the marketplace. Cisco devised the JumpStart™ program to help service providers such as ICG Netcom answer key questions, such as: How do we optimally position new services? What mistakes should we avoid? What markets should we target? What messages should our marketing materials convey? To help service providers answer these questions and get their services to market quickly, Cisco has packaged its extensive expertise in ATM, Frame Relay, and IP technologies, along with its knowledge of service marketing, into JumpStart, a customized joint marketing program for service provider customers. JumpStart joint marketing brings expertise to service providers in four key areas: Marketing analysis Strategic business development Training design and implementation Strategic joint marketing campaign development A JumpStart program can be tailored to include support in all four categories, a single category, or a specific element in a category. Each program is customized to individual requirements; no two JumpStart programs are alike. For instance, Cisco might provide strategic planning and marketing collateral to help a national ISP roll out cable modem services, or it might work closely with an international long-distance carrier to help define the key messages for a VPN services launch. "JumpStart is all about assisting service providers in the creation and launch of new services," says Jeff Zanardi, Manager of Business Development for Cisco's Service Provider Line of Business. "When service providers such as ICG Netcom base their offerings on a Cisco infrastructure, this is our way of standing behind them and helping them develop the best possible service launch for their marketplace." There are two main facets to the JumpStart program, Zanardi continues. First is assistance in developing business plans, service definitions, and strategies for service offerings. The second involves tactical assistance with strategic joint marketing programs. "We put a dedicated team behind the service provider's launch," Zanardi concludes. "The end result is that both companies have a vested interest in the success of the solution."

Table of Contents Posted: Thu Feb 4 17:07:11 PST 1999 Copyright © 1998 Cisco Systems, Inc.