Cable Cut Disrupts India Call Centers

Cable cuts that damaged two undersea Internet cables off Egypt's coast now are disrupting call centers in India, the Wall Street Journal reports. Reportedly, about half of India's Internet bandwidth now is disrupted, and voice traffic to the United States and Europe also are affected.

It could take a week or two to fix the cables, in part because of bad weather, some executives say.

Users in India, Egypt, Qatar, Saudi Arabia, the United Arab Emirates, Kuwait and Bahrain are affected by the outages.

Observers think an anchor might have snagged the cables. At least that's what Flag Telecom Group Ltd. now believes. The incident took place 8.3 kilometers (5.2 miles) from Alexandria beach in northern Egypt.

Emirates Integrated Telecommunications Co., the United Arab Emirates' second-biggest mobile-phone company, is working with the cable operators, Flag Telecom and SEA-ME-WE 4, to find out why the cables were cut and to determine when service can be restored.

The outage is a reminder that physical infrastructure, however mundane, underlies all of modern computing and communications. It's also a reminder that if your business or life depends on Internet-based communications, commerce and content, you need a diversity strategy. It costs more money. But so does inability to do your work.

Amazon Elastic Compute Cloud: Heavy Use

A growing computing architectural theme is the move of functions out of proprietary data centers and "into the cloud," a return in some ways to the days of time sharing as a computing architecture. So it is that 330,000 or so developers have registered to use Amazon Web Services, up more than 30,000 from the prior quarter.

And those users are driving traffic and compute cycles. Amazon Elastic Compute Cloud (EC2) and Amazon Simple Storage Service (S3) consumed more bandwidth in fourth quarter 2007 than was consumed in the same period by all of Amazon.com's global Web sites combined.

At some point, the availability of cloud computing resources is going to fundamentally alter the tradtional "build versus buy" equation that has had enterprises and other large entities building and maintaining their own data centers. At some point the computing framework used by smaller entities and individuals is going to change as well.

At some point, one has to wonder whether communications and computing, increasingly intertwined, might also be thought about in different ways.

To the extent that servers, air conditioning, power, space and communications are the underpinning for applications, and to the extent that enterprises and individuals typically only care about infrastructure to the extent that it enables use of applications, one is lead to ponder the notion of outsourcing of infrastructure.

To what extent must even a large provider "own" its own conduits, routes, physical media, servers and software of an infrastructure sort? To what extent can those things be sourced more extensively on a "buy" basis rather than a "build" basis? In how many more use cases will it make sense to source wholesale capabilities from other providers instead of building, owning and operating facilities?

To the extent that it is the "computing" that matters, not the "computers," one also might ask whether it is the "communications" rather than the "network" that matters.

Margin, Churn Improvement at 8x8

Revenues from Packet8 Virtual Office hosted business phone service now contribute 48 percent of total 8x8 revenues, up one percent from the previous quarter. Virtual Office revenue grew eight percent over the prior quarter. That's important given 8x8's intention to focus on business customers, even as it fills out its revenue with consumer customers.

In the consumer segment, revenue was flat, and declined by three percent year over year. So the consumer business appears stable.

During the December quarter, 8x8 gross margins were 65 percent, an improvement 8x8 attributes to improved scale. Overall service margins rose to 70 percent. Packet8 Virtual Office service margins increased to an all time high of 83 percent, an impressive figure rivaling the sort of return an efficient provider gets from far-simpler T1 services.

Broadband Buckets: Way to Avoid Packet Discrimination

Many years ago, wireless and wireline minutes of use were sold on a metered basis. These days voice and texting are sold by the bucket. There's now more experimentation with that sort of model for broadband access as well.

It might seem odd, but changing the way broadband access is priced at retail, using a model similar to wireless minutes of use and texting, might be beneficial for end users, not simply for Internet Service Providers.

The reason is that if a user wants to buy a bigger bucket to move more packets for peer-to-peer video, the user is happier and so is the provider, who is able to match revenue with use of network resources.

That's arguably a better solution that having ISPs deploy sniffing and packet inspection capabilities so they can inspect all packets (as happy as some solution providers would be to sell all that capability).

Since deep packet inspection has to impose some overhead and latency, the user's applications arguably should work better as well (also avoiding privacy concerns). If any user is found to be shipping around video bits in violation of copyright, there are other remedies.

That's the way enterprises and businesses buy bandwidth, by the way. They pay more money but have unrestricted right to use the bandwidth they've purchased. Pricing consumer access in the same way wireless text and voice now can be bought would allow users to make their own choices about what applications they want to use, and how much.

It isn't metered usage in any way more objectionable than buckets of minutes or texting are. And it might allow ISPs to avoid the DPI effort.

Cable Cuts Take Internet Down

Two international submarine cables in the Mediterranean Sea were damaged on Jan. 30, causing significant disruptions to Internet and phone traffic in Egypt, Saudi Arabia, India and all of the Gulf states.

The two damaged cables are the FLAG Europe-Asia cable, operated by FLAG Telecom, and SeaMeWe-4 (South East Asia-Middle East-Western Europe-4), a consortium cable owned jointly by fifteen telecommunications companies. These two cables account for the majority of international communications capacity between Europe and the Middle East.

The two cable cuts leave the older SeaMeWe-3 system as the only cable in service connecting Europe to the Middle East via Egypt.

The cable cuts have reduced the amount of available capacity on this direct route to Europe by 75 percent (620 Gbps). Until service is restored, many carriers in Egypt and the Middle East must now route their European traffic around the globe, through South East Asia and across the Pacific and Atlantic oceans, or use satellite transport to some extent.

Global capacity executives are watching to see whether a new boost in undersea capacity on some routes across the Pacific will disrupt trans-Pacific pricing. Some also have expressed concern that new routes between Europe and India might have the same effect. The latest undersea cable disruption shows how important multiple and diverse routes have become, though.

What is Dell Planning?

If you go to the Dell Web site and try to buy a Dell Axim, a Windows Mobile-powered personal digital assistant, you can't. So maybe Dell simply is coming out with a new version of the device.

Still, 3GSM happens in February. And 3GSM is the place you'd want to be at if announcing anything important in the wireless space.

Of course, the Axim was a PDA, not a phone. But 3GSM is a phone show. And many of us stopped using our Palms some time ago when our smart phones provided all that functionality inside the phone itself.

If Dell were to introduce a mobile, 3GSM is where they'd want to do it.

Lower European Mobile Data, Texting Prices

Ofcom Chief Executive Ed Richards is lobbying European Commission telecom regulators to slash the allowed prices of international text messaging and mobile Internet access, says Jonathan Prynn, Evening Standard reporter. It appears Richards has in mind prices lower than currently offered by mobile operator O2. O2 charges £3 for one megabyte of data transferred.

So it appears Richards seeks prices significantly lower than the £4.11 per megabyte level that tends to be the average now. European mobile carriers probably will hope to stave off such regulation by voluntarily dropping their tariffs in time for an announcement at Mobile World Congress meeting in February.

The moves would be good for consumers, and obviously financially damaging for carriers. As always is the case, the lower tariffs also would make it harder for upstart competitors to grow their companies by undercutting the high tariffs.