[00:00.000 --> 00:00.880]  Hi.
[00:01.080 --> 00:01.620]  Good afternoon.
[00:01.800 --> 00:02.620]  Happy to be with you.
[00:02.840 --> 00:04.240]  My name is Fred Goldstein.
[00:04.480 --> 00:10.060]  I'm with the Inner Isle Consulting Group, and I've been working in the telecom industry for many years.
[00:10.200 --> 00:14.300]  My specialty is the intersection of regulation, technology, and business.
[00:14.500 --> 00:20.800]  And I've been following FCC telecom activities for a long time and following the technology.
[00:21.040 --> 00:24.940]  So there's a lot of... and also I'm a history buff in this area.
[00:25.040 --> 00:29.980]  So we can talk about where it's going and see how... where it's going in the future.
[00:30.000 --> 00:32.100]  And the future relates to how it's happened in the past.
[00:33.760 --> 00:38.000]  First off, the public switch telephone network really is more than analog POTS.
[00:39.940 --> 00:40.500]  Okay.
[00:40.500 --> 00:46.700]  The network goes back about 140 years when they record switchboards beginning in the 1870s.
[00:46.840 --> 00:52.960]  And so for about the first century, it was dominated by plain old telephone service, POTS.
[00:53.240 --> 00:58.220]  It was a monopoly service, but it was a reliable way to carry voice.
[00:58.220 --> 01:03.660]  Another feature of the monopoly was that the price had no relationship to the cost.
[01:03.900 --> 01:09.240]  They had accounting systems that were designed to cover the cost, and the pricing was entirely political.
[01:09.640 --> 01:11.220]  And there were limited options.
[01:11.460 --> 01:12.380]  It happens in a monopoly.
[01:13.280 --> 01:17.700]  Today's technology has created many ways to talk at a distance.
[01:17.900 --> 01:19.440]  That's what telephone means.
[01:19.440 --> 01:21.040]  A distant talk.
[01:21.300 --> 01:23.120]  Are they still the PSTN?
[01:23.340 --> 01:25.680]  Many of them, not all, still are.
[01:26.200 --> 01:28.620]  What is it that defines the PSTN?
[01:28.680 --> 01:32.400]  When we say PSTN, what exactly is the PSTN?
[01:32.560 --> 01:36.860]  Well, it has a regulated public utility background.
[01:36.860 --> 01:41.740]  The service providers were historically licensed common carriers.
[01:42.120 --> 01:48.920]  They had regulated wholesale prices and still have sometimes regulated retail prices.
[01:49.020 --> 01:50.420]  They used to always be regulated.
[01:50.660 --> 01:53.120]  They had tariffs or price supervision.
[01:53.120 --> 02:01.420]  A principle of the PSTN, universal service, one network with multiple providers.
[02:01.640 --> 02:02.880]  It's not an Internet.
[02:03.100 --> 02:03.920]  It's a catinet.
[02:04.140 --> 02:04.800]  And there's a difference.
[02:05.680 --> 02:09.060]  Common carriage means the payload is sacrosanct.
[02:09.240 --> 02:12.040]  The network can't care about what you say.
[02:12.200 --> 02:16.120]  They don't get a cut of the action based on the value of your speech.
[02:17.200 --> 02:18.900]  Interconnection is mandatory.
[02:19.720 --> 02:23.640]  Everyone can call almost everyone else worldwide.
[02:23.640 --> 02:27.100]  There are exceptions, but they're not the general rule.
[02:27.560 --> 02:30.520]  A carrier must accept traffic from other carriers.
[02:30.520 --> 02:33.560]  They must deliver the traffic to other carriers.
[02:33.960 --> 02:39.540]  The rate is subject to regulation for the interconnection between carriers to prevent gouging.
[02:39.540 --> 02:44.160]  Because if it weren't regulated and I have to give you the call, fine, give me a dollar a minute.
[02:44.280 --> 02:45.320]  You have to give me the call.
[02:45.420 --> 02:46.380]  No, you're not allowed to do that.
[02:47.040 --> 02:49.380]  The government regulated namespace.
[02:49.800 --> 02:51.200]  Telephone numbers are a name.
[02:51.500 --> 02:53.220]  They started off as an address space.
[02:53.380 --> 02:54.400]  Now they're a namespace.
[02:55.020 --> 02:56.240]  But the government owns it.
[02:57.140 --> 03:00.140]  What is not the definition of the PSTN?
[03:00.340 --> 03:03.420]  Well, it's changed in a lot of ways since 1876.
[03:03.420 --> 03:06.980]  So there are a lot of things that aren't definitional.
[03:07.360 --> 03:07.980]  The protocols.
[03:08.360 --> 03:10.240]  Human or machine mediated.
[03:10.440 --> 03:18.120]  It was operators, humans, running the network for the first 50 years in the bell case and even later in some locations.
[03:18.480 --> 03:20.840]  The transmission technology has changed.
[03:20.980 --> 03:22.720]  The switching technology has changed.
[03:22.960 --> 03:27.460]  It's gone back and forth between monopoly and competition multiple times.
[03:27.460 --> 03:31.480]  It went from electromechanical to computer control.
[03:31.680 --> 03:34.180]  It's gone from all fixed to largely mobile.
[03:34.500 --> 03:35.780]  Those are still PSTN.
[03:36.340 --> 03:40.560]  And another thing about the PSTN is that they have backwards compatibility.
[03:40.980 --> 03:44.880]  The current generation and the previous generation, they overlap.
[03:45.920 --> 03:59.540]  Insulated wires, pointing out one of the big improvements around the beginning of the 20th century, instead of having all those wires separate from each other on cross arms, building big bundled insulated cables is a big deal technologically.
[04:00.200 --> 04:02.240]  A lot has changed lately.
[04:02.880 --> 04:10.300]  The Internet itself, which is not the PSTN, is more important to commerce and many individuals than the PSTN.
[04:10.420 --> 04:11.820]  But they are complimentary.
[04:11.820 --> 04:16.360]  If your house are on fire, would you call 911 or send an email?
[04:16.360 --> 04:20.140]  The PSTN is designed for quick, reliable connections.
[04:20.740 --> 04:22.580]  The Internet is catch-as-catch camp.
[04:23.600 --> 04:27.500]  Non-PSTN voice applications do operate on the Internet.
[04:27.760 --> 04:29.120]  They are an alternative.
[04:29.480 --> 04:31.540]  Skype, FaceTime, BlackBerry Messenger.
[04:32.300 --> 04:37.040]  Users carry on many conversations without using the PSTN.
[04:37.640 --> 04:41.440]  The PSTN providers have alienated them.
[04:41.440 --> 04:43.880]  Why do people go to these other applications?
[04:44.140 --> 04:46.520]  Why do people Skype rather than make a phone call?
[04:47.500 --> 04:56.540]  Well, mobile PSTN is as big, in terms of residential minutes of use, and even business to some extent, as the fixed PSTN.
[04:57.220 --> 04:58.360]  It's very popular.
[04:58.520 --> 04:59.580]  It's still the PSTN.
[05:00.020 --> 05:01.500]  Why it's not popular?
[05:01.640 --> 05:03.460]  Maybe the PSTN is controlled by idiots.
[05:03.460 --> 05:05.920]  Think about monopoly DNA.
[05:06.500 --> 05:11.940]  The PSTN is dominated by providers who started as monopolies.
[05:12.020 --> 05:13.280]  They think monopoly.
[05:13.500 --> 05:15.560]  They barely tolerate competition.
[05:15.680 --> 05:19.340]  And for the most part, where there's regulation, the regulation's captive.
[05:19.920 --> 05:22.320]  They don't think they have to be competitive.
[05:22.320 --> 05:24.220]  And they hate the Internet.
[05:24.600 --> 05:26.660]  They never liked the Internet.
[05:26.820 --> 05:28.700]  It broke their business model.
[05:28.800 --> 05:32.940]  The business model of the PSTN always had local, long distance.
[05:32.940 --> 05:34.440]  They charged for distance.
[05:34.980 --> 05:38.600]  The Internet took away the profit, which was from distance.
[05:39.020 --> 05:41.340]  So, they really hated it.
[05:41.440 --> 05:44.080]  And they still do, even though they pay lip service to it.
[05:44.540 --> 05:45.940]  The two biggest U.S.
[05:46.060 --> 05:55.400]  carriers, AT&T, the faux AT&T, it's really Southwestern Bell that bought the rest, and Verizon, which is really Bell Atlantic, they care about mobile.
[05:55.660 --> 05:57.540]  That's where their money is going, their investment.
[05:58.440 --> 06:02.600]  They're not doing much with their fixed networks, except trying to shut them down.
[06:03.300 --> 06:04.820]  Regulation is captive.
[06:05.180 --> 06:06.880]  The states have passed laws.
[06:07.120 --> 06:17.420]  Our friends at ALEC put a model legislation in, many states have passed, to free the incumbent telephone companies from state regulation of rates or service.
[06:17.420 --> 06:22.000]  They start with the assumption that it's so competitive it doesn't need to be regulated.
[06:22.280 --> 06:24.280]  Then they stamp out the competition.
[06:25.560 --> 06:28.620]  Some regulators just don't care, even though they have authority.
[06:28.860 --> 06:35.620]  And the FCC's had this attitude for the past 15 years that some future technology will always fix things.
[06:35.620 --> 06:42.120]  That even if there's not any real competition now, you know, maybe... anyone remember broadband over power line?
[06:42.460 --> 06:47.400]  They actually use that as an excuse to deregulate access to fiber.
[06:47.640 --> 06:51.160]  Because after all, there'll be BPL as a new provider.
[06:51.540 --> 07:07.360]  I really think their model is that subspace communication, you know, in Star Trek communicators, is going to come along and be the ultimate competition, and therefore we don't need to regulate those pesky old copper wires that still have a monopoly of access to most homes.
[07:09.780 --> 07:25.020]  The short-term victories against competition that they've won in the past dozen, 15 years, to shut down competitive voice providers in many cases, shut down competitive Internet providers in many cases, may have led to long-term losses.
[07:25.240 --> 07:26.380]  It was a short-term thinking.
[07:27.500 --> 07:35.020]  Now, another feature of the PSTN, the whole regulatory model, I mentioned they don't like the Internet because it broke their long-distance model.
[07:35.200 --> 07:37.380]  But this goes back to 1929.
[07:37.700 --> 07:40.040]  There was a Supreme Court case, Smith v.
[07:40.200 --> 07:40.780]  Illinois-Bell.
[07:41.520 --> 07:47.860]  And it defined the local telephone network as being partially interstate jurisdiction.
[07:48.160 --> 07:50.640]  The FCC... well, in those days, it wasn't the FCC.
[07:51.760 --> 07:57.460]  Long-distance, you know, a dollar a minute was worth, in today's terms, a dollar a minute in 1929?
[07:57.800 --> 08:04.700]  But for a businessman making a big deal, you go Chicago to New York, pay whatever it costs in order to finish a deal.
[08:04.920 --> 08:10.520]  If you ever watch Boardwalk Empire, when Nucky, this is the 1920s, and Nucky would pick up the phone and call Cuba?
[08:11.040 --> 08:18.960]  You know, that was possible, but it was not something anyone with less resources than Nucky could have done, right?
[08:18.960 --> 08:25.840]  And so as long as you're only dealing with rich folks, Smith was the Attorney General of Illinois and a populist.
[08:25.940 --> 08:35.400]  And so he wanted to lower phone rates by putting hard to bill onto the federal jurisdiction so that long distance would cover part of the cost of local service.
[08:35.400 --> 08:41.540]  That was a great consumer victory in 1929, but now that tail wags the door.
[08:43.000 --> 08:48.780]  Regulation has been based on subsidizing local POTS lines from long distance revenues.
[08:49.480 --> 08:51.300]  Well, they don't locate mobile phones.
[08:51.620 --> 08:52.560]  You can't locate.
[08:52.680 --> 08:53.460]  Are they local or not?
[08:53.920 --> 08:56.540]  So, they're not subject to the same charges.
[08:57.300 --> 08:59.320]  1996, they changed the rules for mobile.
[08:59.420 --> 09:05.620]  Well, of course, in 1996, mobile was, again, a rare luxury, you know, very small impact.
[09:05.980 --> 09:07.900]  Why are lines still continuing to pay?
[09:08.140 --> 09:12.900]  Well, now what we've got is that most people are using mobile because it's not subject to those rules.
[09:12.900 --> 09:34.500]  And so the tiny percentage of people who still use POTS lines are being gouged because those long distance calls, and that can be two towns away, are treated as a luxury still, paying the tax to support the basic rate, which is why people have gone to cut the cord all mobile because they don't get gouged on it.
[09:35.340 --> 09:36.620]  Why do we continue this?
[09:37.080 --> 09:38.760]  The bell companies don't get that money.
[09:38.760 --> 09:43.240]  The rural phone companies, in the U.S., it's about 2% of the total business.
[09:43.540 --> 09:46.760]  The rural phone companies still depend on long distance.
[09:47.020 --> 09:48.580]  They're called switch access charges.
[09:48.840 --> 09:52.820]  The minutes of use a long distance company pays to deliver a call to them.
[09:53.120 --> 09:58.080]  And so all the rules are still based on keeping them alive on that basis.
[09:58.500 --> 10:07.040]  Being phased out, largely phased down from where it was, but the structure is still in place to worry about what's local, what's long distance.
[10:08.960 --> 10:10.220]  Let's look at monopoly.
[10:10.380 --> 10:13.720]  We assume, well, it was a monopoly before the Telecom Act.
[10:13.760 --> 10:15.080]  Now it's supposed to be competitive.
[10:15.780 --> 10:19.040]  The PSTN was competitive starting in 1893.
[10:20.720 --> 10:26.320]  Bell patented the telephone in 1876 at 17 years of monopoly.
[10:27.120 --> 10:32.020]  But in 1893, it opened up, and independent telephone companies have it.
[10:32.600 --> 10:34.700]  Bell, though, did control long distance.
[10:34.700 --> 10:41.300]  The loading coil, they bought the patent on the loading coil, which let the phone work well between 5 and 50 miles.
[10:41.820 --> 10:45.160]  And then they had additional patents along the years.
[10:45.200 --> 10:48.320]  They've always been strong in patents to protect their monopolies.
[10:48.620 --> 11:05.780]  The Kingsbury Commitment was a deal made with the Assistant Attorney General Kingsbury in 1912 that said, well, instead of having real competition, we'll allow the independent telephone companies to connect to our long distance network, so they can make toll calls,
[11:05.860 --> 11:09.300]  not local, but toll calls across our network.
[11:09.940 --> 11:13.360]  And in exchange, we will not buy them up unless they go bankrupt.
[11:13.640 --> 11:16.700]  So we ended up with this structure of a patchwork of phone companies.
[11:16.700 --> 11:22.720]  So you had the bells in the cities and the independent phone companies in the country where the profit margins were lower.
[11:23.040 --> 11:30.400]  And so most of the countryside and some smaller markets, linked in Nebraska, Rochester, New York, were non-bell markets.
[11:30.400 --> 11:32.760]  But almost all the big cities were bell markets.
[11:34.240 --> 11:37.520]  By 1934, the remaining competition had all gone out of business.
[11:37.520 --> 11:39.640]  So it allowed a de jure monopoly.
[11:39.920 --> 11:42.940]  It assumed the telephone industry was a monopoly.
[11:43.680 --> 11:44.580]  Regulated rates.
[11:45.400 --> 11:47.620]  And they regulated the monopoly.
[11:47.620 --> 11:48.500]  It was on everything.
[11:48.660 --> 11:49.780]  The telephone handset.
[11:49.880 --> 11:50.080]  Remember?
[11:50.300 --> 11:51.620]  You had to rent your phone.
[11:51.740 --> 11:53.280]  You couldn't have a modem without...
[11:53.280 --> 11:54.560]  A 103 modem.
[11:54.760 --> 11:55.880]  300 bits per second.
[11:56.000 --> 11:58.500]  Anyone remember what that rented for in 1968?
[11:59.940 --> 12:00.740]  Standard bit?
[12:01.020 --> 12:01.200]  Huh?
[12:01.500 --> 12:02.600]  $90 a month.
[12:02.720 --> 12:04.960]  I think it was $25 for the Model 103.
[12:05.560 --> 12:08.720]  But the higher speed modems would be $90 a month.
[12:09.900 --> 12:10.920]  So just to have...
[12:10.920 --> 12:12.320]  There may be exceptions in some states though.
[12:12.540 --> 12:13.380]  Acoustic coupled.
[12:13.560 --> 12:14.800]  Well, those weren't acoustic.
[12:15.000 --> 12:16.660]  Those were actually direct plug-in.
[12:16.760 --> 12:19.540]  But acoustic couplers were not...
[12:19.540 --> 12:19.620]  What?
[12:19.980 --> 12:21.080]  They did exist.
[12:22.620 --> 12:26.060]  One of the bell companies decided to challenge acoustic couplers.
[12:26.200 --> 12:28.320]  In 1968, they lost the case.
[12:28.940 --> 12:29.780]  Carter phone was...
[12:29.780 --> 12:32.620]  The Carter phone device was an acoustic coupler.
[12:32.680 --> 12:33.320]  Not for data.
[12:33.320 --> 12:35.400]  For offshore radio.
[12:36.200 --> 12:38.140]  Offshore radio and telephone interface.
[12:38.660 --> 12:39.040]  Acoustic.
[12:39.620 --> 12:42.340]  And the FCC ruled that that was okay.
[12:42.680 --> 12:48.420]  And that, in fact, other terminal devices could be attached to the network that it shouldn't be a monopoly anymore.
[12:48.420 --> 12:50.900]  They cried in their beer.
[12:51.040 --> 13:02.180]  Grandma would not be able to afford a phone if they couldn't make the monopoly profits renting luxury items like princess phones, telephones that were not black.
[13:02.820 --> 13:05.440]  Answering machines, which they...
[13:05.440 --> 13:08.500]  They paid $400 for and rented for many dollars a month.
[13:08.640 --> 13:12.180]  Mostly to movie theaters to play the recorded announcements.
[13:12.500 --> 13:17.260]  Didn't have answering machines at home because bell companies didn't, you know, rent them cheaply.
[13:17.780 --> 13:24.900]  So they cried in their beer when answering machines came out because now the call completion rate went up.
[13:25.100 --> 13:26.760]  Someone dialed a long-distance call.
[13:26.880 --> 13:27.520]  No one's home.
[13:27.820 --> 13:29.160]  The answering machine answered.
[13:29.160 --> 13:31.260]  They got their money for the call.
[13:31.500 --> 13:32.740]  They didn't want that to happen.
[13:32.860 --> 13:34.160]  They cried all the way to the bank.
[13:34.280 --> 13:37.900]  That's very much the history of the telephone industry, crying all the way to the bank.
[13:39.520 --> 13:51.800]  In 1969, the MCI decision opened up private line competition that Microwave Communications Incorporated built a microwave network from Chicago to St. Louis and wanted to rent it to people.
[13:52.680 --> 13:55.600]  And the bell system said, oh, no, you can't rent that.
[13:55.700 --> 13:56.340]  We have a monopoly.
[13:56.340 --> 13:59.700]  The FCC said, no, private lines can be competitive.
[14:00.000 --> 14:03.360]  And that expanded, too, into long distance.
[14:03.720 --> 14:19.460]  The modified final judgment, which was called divestiture in 1984, took effect, broke up Ma Bell into AT&T, the competitive long distance and equipment company, and the seven regional bell operating companies that were the local telephone monopolies.
[14:19.460 --> 14:26.220]  The assumption was these poor little baby bells needed protection because all the money was in long distance.
[14:26.560 --> 14:36.280]  But the structure was that the monopoly was able to charge minutes of use to all the long distance companies and gouge monopoly profits out of them.
[14:36.280 --> 14:38.620]  So the bells cried all the way to the bank.
[14:38.960 --> 14:40.120]  MCI is dead.
[14:40.780 --> 14:47.380]  It's owned by... its assets were acquired in bankruptcy by Bell Atlantic, named itself Verizon.
[14:48.060 --> 14:49.140]  AT&T is dead.
[14:49.360 --> 14:54.340]  Its assets acquired by Southwestern Bell, which decided to use the AT&T brand name.
[14:54.940 --> 14:55.040]  Right?
[14:55.460 --> 14:58.560]  Sprint still carries on as a separate company, but it's mostly mobile.
[14:59.560 --> 15:01.200]  So, big changes.
[15:01.200 --> 15:04.700]  That was supposed to have monopoly in local.
[15:04.880 --> 15:08.440]  In 1984, long distance was deemed naturally competitive.
[15:08.820 --> 15:13.440]  In 1996, local was deemed competitive, too.
[15:13.680 --> 15:16.400]  It broke up the de jure, local monopoly.
[15:16.660 --> 15:19.000]  States would not authorize local telephone competition.
[15:19.360 --> 15:19.780]  Some did.
[15:19.880 --> 15:20.380]  New York did.
[15:20.460 --> 15:22.200]  Massachusetts had just begun to do so.
[15:22.420 --> 15:25.320]  But Telecom Act opened up local competition.
[15:26.920 --> 15:29.420]  Cable companies have been the major beneficiaries.
[15:29.860 --> 15:31.180]  They had their own wires.
[15:31.620 --> 15:34.740]  Telecom Act says the Bells are supposed to rent their wires to competitors.
[15:35.020 --> 15:42.400]  But between 2001 and 2005, the FCC whittled away all the rules that the previous five years had been passed.
[15:42.580 --> 15:47.580]  So it's very hard to compete with the Bell Company using any of their own facilities.
[15:47.880 --> 15:53.860]  There are all sorts of anti-competitive rules to protect... that the Bells have now to protect their assets.
[15:53.860 --> 15:56.120]  Because they claim it's also competitive.
[15:56.440 --> 16:01.240]  And in a few locations, mostly high-rise office buildings in New York City, it is.
[16:02.480 --> 16:04.580]  Let's go back to the 1960s.
[16:04.660 --> 16:06.980]  How do computers relate to the phone network?
[16:07.300 --> 16:11.980]  The computer inquiries were a series of rulings by the FCC.
[16:12.680 --> 16:15.220]  These are what permit the Internet to exist.
[16:15.220 --> 16:24.560]  Does anyone think the Internet as we know it, as a public service, would have been allowed if the FCC had to go through their rulemaking process?
[16:25.100 --> 16:27.900]  Anyone know how long the FCC's rulemaking process takes?
[16:28.640 --> 16:32.780]  They opened up a docket to determine what is voice over IP.
[16:33.120 --> 16:36.700]  In 1996, they still have not decided.
[16:36.700 --> 16:42.720]  They opened a docket to look at switched access... special access rates, private line rates.
[16:43.120 --> 16:46.200]  Opened that under court order in 2005.
[16:46.620 --> 16:49.480]  Issued their first ruling a couple of months ago.
[16:49.980 --> 16:51.920]  Haven't released new rates.
[16:52.240 --> 16:59.520]  Issued a ruling saying, oh, those rates that have been in place for the past 11 years are illegal after all.
[16:59.520 --> 17:03.360]  We'll have to think about what to do about that over the next few years.
[17:03.620 --> 17:09.520]  And, of course, the telephone monopolies are crying in their beer and saying, oh, we're being killed by competition.
[17:09.800 --> 17:12.040]  They're making so much monopoly profit there.
[17:13.140 --> 17:16.020]  It's huge, the monopoly profit they're making.
[17:16.440 --> 17:22.280]  The computer inquiries were a way to say, computers... this is 1966.
[17:23.100 --> 17:24.960]  Computers will attach to the phone network.
[17:24.960 --> 17:26.700]  Will they be in the network?
[17:27.080 --> 17:30.440]  The 1ESS computer-controlled switch had just come out.
[17:31.020 --> 17:32.360]  Will people attach to the network?
[17:32.580 --> 17:33.880]  Modems existed already.
[17:34.340 --> 17:40.680]  So, where do you draw the line as to how do computers become part of the network versus computers not part of the network?
[17:42.280 --> 17:45.040]  Payload or carriage itself?
[17:47.340 --> 17:53.800]  They didn't have a clean answer in Computer 1, but in 1980, the Computer 2 ruling was a nice, clear answer.
[17:53.800 --> 17:56.440]  It was more important than divestiture.
[17:56.680 --> 18:01.460]  The impact of Computer 2 is people don't realize it was more important.
[18:01.600 --> 18:03.800]  It revolutionized the market in the U.S.
[18:04.180 --> 18:06.600]  Later on, the rest of the world followed our lead.
[18:06.940 --> 18:09.660]  And the FCC repealed it in 2005.
[18:10.380 --> 18:21.320]  The Computer 2 rule said that terminal equipment, that means phones, PBXs, modems, equipment that plugs into the jack must not be part of the tariff.
[18:21.320 --> 18:24.960]  A local phone company could not rent you the equipment.
[18:25.640 --> 18:27.780]  AT&T owned the local phone companies.
[18:28.020 --> 18:31.700]  They could only rent it through a fully separate subsidiary.
[18:31.900 --> 18:39.100]  And because divestiture hadn't happened yet, AT&T created a subsidiary on paper called American Bell Incorporated.
[18:39.140 --> 18:40.460]  Anyone remember American Bell Inc?
[18:40.460 --> 18:40.720]  Yeah.
[18:40.720 --> 18:43.060]  It lasted for one year, 1983.
[18:43.680 --> 18:47.400]  Because Computer 2 took effect in 1983 and divestiture was 1984.
[18:47.900 --> 18:49.780]  So ABI existed for a year.
[18:51.140 --> 18:54.840]  And they defined in Computer 2 a very critical distinction.
[18:54.840 --> 19:01.280]  Something called basic service, that's raw telecommunications, moving the bits unchanged.
[19:01.880 --> 19:04.280]  Enhanced service is the stuff done in the payload.
[19:04.600 --> 19:11.780]  And the Bell companies were barred from offering enhanced services except through a fully separate subsidiary.
[19:12.000 --> 19:17.580]  So anyone could attach the same terms that the Bell's own subsidiary could attach.
[19:18.580 --> 19:21.120]  Online data services took advantage of this.
[19:21.500 --> 19:22.680]  Modems could attach.
[19:22.680 --> 19:24.080]  They were enhanced services.
[19:24.300 --> 19:29.580]  They didn't have to pay long-distance access charges, which voice long-distance had to pay.
[19:29.740 --> 19:32.260]  That was the point of Computer 2, people don't realize.
[19:32.600 --> 19:38.460]  To draw a line between the long-distance competition had only been authorized officially one year earlier.
[19:39.300 --> 19:43.400]  1979, final N-FIRE rulings created switched access.
[19:43.680 --> 19:46.760]  They didn't want to lose that to people plugging in long-distance companies.
[19:46.920 --> 19:51.360]  So the rule for Computer 2 was, well, if it's voice, it's basic, it's a long-distance call.
[19:51.360 --> 19:56.380]  If it's a computer protocol, anything, it's enhanced, not a long-distance call.
[19:56.500 --> 19:57.240]  That was the whole point.
[19:57.580 --> 19:59.340]  And that's still jumbled.
[19:59.480 --> 20:00.340]  No one remembers that.
[20:00.420 --> 20:02.700]  And that's why we have all this talk, oh, VoIP is enhanced.
[20:02.960 --> 20:04.540]  Bull effing you-know-what.
[20:04.880 --> 20:08.600]  If it's just plain long-distance using VoIP, the Bell's are using that as an excuse.
[20:08.720 --> 20:09.280]  We'll get to that.
[20:09.440 --> 20:10.180]  It's basic.
[20:10.780 --> 20:12.940]  The 1987 modem tax.
[20:13.020 --> 20:13.820]  Anyone remember that?
[20:13.920 --> 20:18.840]  When the FCC proposed, oh, well, the telephone... the online service industry's grown up.
[20:18.920 --> 20:20.440]  They can afford to pay access charges.
[20:20.640 --> 20:22.120]  A nickel a minute to use a modem.
[20:22.360 --> 20:23.400]  That was the plan.
[20:24.480 --> 20:25.580]  Got turned down.
[20:26.140 --> 20:27.280]  Lots of congressional pressure.
[20:28.340 --> 20:29.980]  Congress and Markey led the charge.
[20:30.820 --> 20:34.460]  They evolved... the online services evolved into ISPs.
[20:34.460 --> 20:36.140]  It wasn't that ISPs popped up.
[20:36.520 --> 20:41.700]  AOL and, you know, Prodigy and others, they started offering email.
[20:41.940 --> 20:42.560]  Internet email.
[20:42.840 --> 20:44.400]  They started offering Usenet.
[20:44.600 --> 20:46.640]  They started offering web access.
[20:46.920 --> 20:52.100]  They morphed application by application over the 1990s until they became ISPs.
[20:53.100 --> 20:58.140]  The Bells always hated this, but common carriage rules required them to allow it.
[20:58.260 --> 20:59.920]  They don't control the payload.
[21:01.420 --> 21:07.080]  Since 2000, the actual wireline PSTN has been pricing itself out of business.
[21:07.500 --> 21:10.140]  The penetration of POTS goes down.
[21:10.340 --> 21:12.120]  Fewer using POTS, more using mobile.
[21:12.460 --> 21:13.480]  So what do they do?
[21:13.560 --> 21:14.460]  They raise the prices.
[21:14.660 --> 21:15.900]  Have you learned that in retailing?
[21:16.060 --> 21:18.280]  Well, people stop buying it and raise the price, right?
[21:19.120 --> 21:21.580]  Only if you're a utility or the phone company.
[21:22.060 --> 21:26.700]  Well, if the price goes up, people go away and it's a death spiral.
[21:27.140 --> 21:28.200]  They cut the cord.
[21:28.200 --> 21:31.860]  ILECs don't understand basic pricing.
[21:32.100 --> 21:34.120]  They think they're entitled to revenue.
[21:34.240 --> 21:35.420]  How much money do we want to make?
[21:35.480 --> 21:37.180]  Divide by the remaining number of customers.
[21:37.400 --> 21:38.360]  Set the price.
[21:39.020 --> 21:42.120]  VoIP and mobile are both getting regulatory breaks.
[21:42.260 --> 21:45.220]  They don't pay the access charges that POTS does.
[21:46.080 --> 21:48.420]  The Bells, however, are making huge money.
[21:48.780 --> 21:52.100]  Most of their revenue comes now from special access.
[21:52.820 --> 21:56.320]  These are now under the new name the FCC adopted two months ago or so.
[21:56.660 --> 21:58.660]  Business Data Services, BDS.
[21:58.840 --> 22:00.500]  There's something kinky that reminds me of.
[22:02.220 --> 22:04.880]  Most of that is backhaul to the cell towers.
[22:05.120 --> 22:08.600]  Because cellular is wireless for the last thousand feet.
[22:08.840 --> 22:09.280]  Right?
[22:09.560 --> 22:10.340]  Depending where you are.
[22:10.420 --> 22:11.220]  Could be a couple of miles.
[22:11.220 --> 22:15.220]  But it's a wired network with a very long cordless cord.
[22:15.820 --> 22:18.480]  Cellular is still based on wire.
[22:18.680 --> 22:20.100]  And it's fiber nowadays.
[22:20.420 --> 22:21.340]  Most cases.
[22:21.640 --> 22:24.300]  And in many cases still copper to smaller cells.
[22:24.740 --> 22:27.200]  And it's still monopoly priced.
[22:27.200 --> 22:30.420]  They gouge the smaller cell codes.
[22:30.600 --> 22:30.620]  Right?
[22:32.180 --> 22:36.700]  Verizon does one deal for Verizon Wireless and another deal for Sprint.
[22:37.580 --> 22:40.000]  They cross-subsidize their affiliates that way.
[22:40.340 --> 22:46.520]  Verizon Core, the wireline company, installs fiber dedicated to its own wireless.
[22:46.520 --> 22:49.460]  They will not do for T-Mobile or Sprint.
[22:49.620 --> 22:50.800]  Or even AT&T.
[22:50.980 --> 22:56.600]  Although with AT&T, I always think Verizon and AT&T have a little back scratching in their own territories.
[22:57.840 --> 23:02.860]  Data circuits used by businesses and ISPs are part of BDS.
[23:03.180 --> 23:04.320]  So this is the money.
[23:04.500 --> 23:11.100]  And the revenue, because many of these have been deregulated, the FCC ten years ago said, oh, you don't have to tariff these anymore.
[23:11.200 --> 23:12.500]  Just they're unregulated.
[23:12.840 --> 23:13.820]  There's so much competition.
[23:14.280 --> 23:15.580]  The market will take care of it.
[23:15.760 --> 23:18.120]  So the revenue doesn't even show up on their books.
[23:18.260 --> 23:20.840]  They go to the state regulators, oh, we're losing money.
[23:21.080 --> 23:24.680]  They go to the Wall Street investor, oh, we're making great money.
[23:24.680 --> 23:26.520]  They talk out of both sides of their mouth.
[23:30.390 --> 23:37.570]  The public switch telephone network does continue unabated as a wholesale service to interconnect all the carriers.
[23:38.290 --> 23:40.430]  It carries billions of calls.
[23:40.770 --> 23:45.430]  The tandem network of tandem switches interconnects the wireline and wireless carriers.
[23:45.610 --> 23:47.750]  Those have been modernized in recent years.
[23:47.870 --> 23:48.870]  They do support VoIP.
[23:49.050 --> 23:53.670]  The newer ones, not that they'll let a competitor use it, but they do support it.
[23:53.670 --> 23:59.530]  There's modern switches like Sonus Networks replacing the old four ESSs, which are gone.
[24:00.990 --> 24:09.830]  Interconnected VoIP providers have to buy their access from a CLEC, which is a competitive local exchange carrier, is a true PSTN carrier.
[24:10.110 --> 24:11.670]  They interconnect by the rules.
[24:11.790 --> 24:12.510]  They go to each other.
[24:12.590 --> 24:13.690]  They connect to the tandems.
[24:14.030 --> 24:18.730]  The problem is that the long-distance business uses least-cost routing.
[24:18.730 --> 24:20.090]  There are many long-distance companies.
[24:20.350 --> 24:22.750]  And they quote prices to every destination.
[24:22.890 --> 24:24.330]  So they go to the cheapest one.
[24:24.490 --> 24:27.690]  But they're actually forming routing loops because they're...
[24:27.690 --> 24:28.770]  Each one's bought.
[24:28.870 --> 24:29.810]  He's the cheapest to there.
[24:29.890 --> 24:31.690]  He's the cheapest to the different contracts.
[24:31.730 --> 24:32.850]  And the call never gets through.
[24:33.170 --> 24:34.170]  This has been a problem.
[24:34.350 --> 24:36.190]  I've worked with some rural carriers.
[24:36.290 --> 24:41.070]  They discover they literally can't get through, and you have to convince somebody to change the routing.
[24:42.190 --> 24:45.930]  The Internet itself does not carry much PSTN.
[24:46.010 --> 24:48.990]  For all the talk of VoIP, it's not the Internet.
[24:49.170 --> 24:51.490]  True VoIP is not much traffic.
[24:51.790 --> 24:57.230]  Maybe 6% of voice calls go over the Internet because the quality is inadequate.
[24:57.970 --> 24:58.090]  Okay?
[24:58.370 --> 24:59.290]  Bad quality.
[24:59.450 --> 25:02.210]  The Internet was designed to be the non-PSTN.
[25:02.250 --> 25:03.430]  We had a PSTN.
[25:03.590 --> 25:08.250]  The Internet was as optimized for non-streaming data services.
[25:09.030 --> 25:09.970]  What does it offer?
[25:10.090 --> 25:14.830]  The only service the Internet offers is called best efforts, scare quotes required.
[25:15.490 --> 25:15.890]  Right?
[25:15.950 --> 25:16.890]  It's not the best efforts.
[25:17.010 --> 25:17.630]  Best means best.
[25:17.810 --> 25:20.710]  But in the Internet world, best means the lowest class of service.
[25:20.870 --> 25:21.650]  Oh, it's just best efforts.
[25:21.930 --> 25:25.050]  Tell a lawyer, oh, I'm just going to make a contract for best efforts.
[25:25.250 --> 25:28.130]  If I don't deliver, it's okay because it's just best efforts.
[25:28.410 --> 25:31.290]  In contract law, best means best.
[25:32.030 --> 25:34.770]  And so they have this thing I call BESQR service.
[25:34.770 --> 25:39.730]  IP transport is the bottom quality, not really good for voice.
[25:39.870 --> 25:40.610]  It works sometimes.
[25:40.890 --> 25:41.610]  It's not always.
[25:42.450 --> 25:44.090]  Let's look at the evolution, though.
[25:44.170 --> 25:45.670]  The PSTN always evolved.
[25:45.830 --> 25:47.990]  IP is an evolutionary change.
[25:48.350 --> 25:48.710]  Right?
[25:49.670 --> 25:51.810]  1876, Elisha Gray invented the...
[25:51.810 --> 25:52.350]  Right?
[25:52.490 --> 25:53.110]  Invented the phone.
[25:54.150 --> 25:57.270]  Oh, you thought Alexander Graham Bell invented it?
[25:57.470 --> 25:59.390]  Have you hugged your patent lawyer today?
[26:00.190 --> 26:01.550]  Bell's phone didn't work.
[26:01.710 --> 26:02.850]  Gray invented the microphone.
[26:02.850 --> 26:05.090]  Bell's phone you shouted into the earpiece.
[26:05.590 --> 26:06.030]  Okay?
[26:06.170 --> 26:09.650]  And it worked from downstairs to upstairs in his lab in Scully Square in Boston.
[26:09.990 --> 26:11.730]  Of course, you could hear him up the stairway.
[26:12.790 --> 26:15.870]  Gray invented the carbon microphone, and that's what went into production.
[26:16.870 --> 26:17.850]  But Bell bribed...
[26:18.570 --> 26:21.150]  Bell's patent lawyer bribed the patent examiner.
[26:21.630 --> 26:22.770]  He was assigned the patent.
[26:24.670 --> 26:26.430]  In 1893, Almon v. Strowger invented the dial.
[26:28.890 --> 26:31.290]  Automatic dial so it didn't have to go through a cord switchboard.
[26:32.370 --> 26:34.250]  Bell's patents also expired.
[26:35.230 --> 26:38.410]  Independent telephone companies adopted the dial system.
[26:38.930 --> 26:43.610]  Bell stayed for years manual until the 1920s, with rare exceptions.
[26:43.990 --> 26:44.770]  Not invented here.
[26:44.890 --> 26:46.990]  They weren't going to pay for Strowger's patent.
[26:47.190 --> 26:49.310]  And that's the stepper switch, what Strowger invented.
[26:49.750 --> 26:49.830]  Right?
[26:49.970 --> 26:51.510]  It would go... click, click, click, click.
[26:51.710 --> 26:58.950]  Each interruption of the current would move it one notch, and then it would go up or down to find a free path out.
[26:58.950 --> 27:02.250]  There were line finders and selectors and connectors.
[27:02.450 --> 27:05.250]  The three variants on the stepper switch, depending where in the matrix they were.
[27:07.770 --> 27:11.310]  1906, the vacuum tube amplifier, the triode, was invented.
[27:11.810 --> 27:16.990]  And as amplifiers were deployed and improved, the range of a telephone call increased.
[27:18.650 --> 27:26.870]  Bell had the patent on loading coils, though, from the 1890s until that expired, which had a big importance on metropolitan calls.
[27:26.870 --> 27:27.870]  It's like 50, 100 miles.
[27:28.510 --> 27:32.330]  In the 1920s, frequency division multiplexing was invented.
[27:32.490 --> 27:37.910]  That means you'd like putting radio spectrum onto wire, different channels in the supersonic range.
[27:38.070 --> 27:45.470]  And so that became very important, to get more than one call at a time over a physical piece of wire.
[27:47.290 --> 27:50.670]  1920s, common control electromechanical switching.
[27:50.670 --> 27:59.570]  Instead of the stepper, where the call literally pulse by pulse to the switch, there was a contraption of relays running a matrix of switches.
[27:59.830 --> 28:00.890]  This was like computing.
[28:00.990 --> 28:05.930]  This is like a relay computer, to decode the dial pulses and figure out where to send the call.
[28:06.270 --> 28:09.350]  This started off with the panel switch and then the crossbar switches.
[28:10.150 --> 28:14.830]  Wonderful contraptions of relays, a skill that has been lost to the modern world.
[28:14.830 --> 28:16.550]  Nowadays, people write code.
[28:16.890 --> 28:19.610]  Nobody knows how to wire up great contraptions of relays.
[28:19.810 --> 28:23.890]  I think if anyone... this would be the place where we'd find people who would be willing to write anything.
[28:23.970 --> 28:30.070]  I could just see a... let's build a relay computer would be a fun project for the hope contributors, just for the sake of doing it.
[28:32.010 --> 28:40.190]  In the 1940s, microwave was invented, really started World War II radar, and then microwave radio in the late 40s to carry telephone calls.
[28:40.190 --> 28:52.350]  In the 1950s, AT&T Long Lines Division built a nationwide microwave network, and by the 1960s, a majority of long distance calls, interstate calls, traveled by microwave.
[28:52.890 --> 28:57.230]  This is all done with analog technology, frequency division multiplexing.
[28:57.230 --> 28:58.670]  So there were channel banks.
[28:58.830 --> 29:01.250]  In those days, a channel bank was analog channel.
[29:01.430 --> 29:12.930]  Four kilohertz spacing, single-sideband audio, being sent on multiplexers of multiplexers of multiplexers in an analog hierarchy of very, very carefully tuned.
[29:13.190 --> 29:19.690]  It took a lot of maintenance to get these all channels balanced so the levels were right and the crosstalk wasn't there.
[29:19.690 --> 29:26.570]  All these stuck onto a microwave radio system, a precision, expensive analog microwave radio system.
[29:26.810 --> 29:34.630]  And they'd go about 30 miles on a hop, and huge antennas, and very complicated klystron amplifiers.
[29:34.750 --> 29:36.450]  And I checked the licenses on these.
[29:36.630 --> 29:43.770]  The power output of these amplifiers, how much power do you think one of those big AT&T microwave links, backbone links put out?
[29:44.130 --> 29:46.070]  You know how much power they could generate in their transmitters?
[29:46.070 --> 29:46.650]  For what?
[29:46.810 --> 29:48.170]  1,500 watts.
[29:48.250 --> 29:48.850]  4 watts.
[29:50.470 --> 29:53.270]  When did they deploy in-band signaling?
[29:54.270 --> 29:55.310]  I'm coming to that.
[29:55.350 --> 29:55.730]  You could.
[29:55.930 --> 30:04.750]  Yeah, the Strouge, 1920s, the Strouge, well, actually 1890s, the Strouges, which was in-band signaling, it was interrupting the D C.
[30:05.530 --> 30:05.690]  Right.
[30:05.870 --> 30:08.490]  In terms of... we'll get to how they did it in FDM.
[30:08.750 --> 30:10.710]  Next, that's to get there.
[30:11.290 --> 30:14.090]  Also note the television networks began in 1948.
[30:14.090 --> 30:17.010]  The FCC said they couldn't build their own networks.
[30:17.170 --> 30:20.570]  They had to pay AT&T monthly rents to build the networks.
[30:21.390 --> 30:27.630]  Private microwave was only authorized in 1959 in an FCC decision called Above 890.
[30:27.950 --> 30:29.970]  Microwave began at 890 MHz.
[30:30.870 --> 30:33.490]  This is a map of the Longlines network in 1960.
[30:33.990 --> 30:39.190]  They had built this huge nationwide network, and every 30 miles they had to have a relay station.
[30:42.810 --> 30:48.130]  There is a website, longlines.org, I think, that collects a lot of these old documents.
[30:49.790 --> 30:51.770]  Another change in technology?
[30:52.250 --> 30:55.110]  Embedded computing entering the network.
[30:55.470 --> 30:59.330]  Now, the first digital technology in the network wasn't a computer.
[30:59.470 --> 31:00.150]  It was T-carrier.
[31:00.590 --> 31:05.610]  T1, it was 1960, it was actually built in the lab.
[31:05.610 --> 31:15.250]  It had pulse code modulation, turning samples using sampling theory, 8,000 samples per second, turned into an 8-bit number.
[31:15.710 --> 31:19.330]  And it was designed to run 6,000 feet on copper twisted pair.
[31:19.610 --> 31:20.790]  Why 6,000 feet?
[31:20.910 --> 31:22.950]  Loading coils went 6,000 feet.
[31:23.070 --> 31:25.490]  So it fit the architecture of the outside plant.
[31:25.590 --> 31:27.370]  They'd replace a loading coil with an amplifier.
[31:28.230 --> 31:33.970]  And at the end were channel banks, just like frequency division multiplex, only it was the D1 channel bank.
[31:34.070 --> 31:35.790]  And they evolved that to the D4 eventually.
[31:36.710 --> 31:42.170]  In 1965, AT&T introduced the 1ESS electromechanical switch.
[31:42.290 --> 31:43.850]  Oh, wait, you said it was computer?
[31:44.050 --> 31:45.490]  Under computer control.
[31:45.630 --> 31:47.890]  But the path of the call went through reed relays.
[31:48.050 --> 31:49.750]  It was partially computerized.
[31:50.150 --> 31:51.730]  The computer was unique.
[31:51.870 --> 31:55.350]  They wanted this thing to have legendary bell system reliability.
[31:55.350 --> 32:00.630]  And to be sure, the telephone network was designed for that famous five nines reliability.
[32:01.170 --> 32:04.890]  And so they used ferrite core memory still.
[32:05.130 --> 32:05.950]  Remember ferrite cores?
[32:06.450 --> 32:09.070]  Ferrite sheet memory for program storage.
[32:09.090 --> 32:09.690]  That was unique.
[32:09.990 --> 32:12.130]  And it had three address spaces.
[32:12.310 --> 32:15.930]  There was Pdata, Udata, and working store were separate memory addresses.
[32:16.130 --> 32:20.150]  Some of you may remember, you know, some computer architectures have I space and D space.
[32:20.150 --> 32:24.130]  But there were two different D spaces in telephone switches.
[32:25.390 --> 32:30.930]  40-year lifetime was just an assumption because phone poles were 40 years, relays were 40 years.
[32:31.290 --> 32:37.970]  And the depreciation schedule they used in those days, every piece of capital investment was called a vintage group.
[32:38.170 --> 32:42.190]  Everything they bought went into this vintage group and was depreciated over 40 years.
[32:42.190 --> 32:45.730]  So they had to build all their equipment around a 40-year design if they wanted to.
[32:46.090 --> 32:47.230]  Computers, they thought.
[32:47.510 --> 32:49.910]  You know, they knew they couldn't do it with general purpose computers.
[32:50.750 --> 32:56.530]  But they did design this as a 40-year lifespan and thought because it was computerized, oh, we can always add whatever features are needed.
[32:56.810 --> 33:00.850]  They just didn't understand that there could be, you know, computers didn't last that long.
[33:00.850 --> 33:08.430]  The interfaces were analog, it was backwards compatible with all the relays, with the steppers, with the crossbars.
[33:09.170 --> 33:11.770]  In the 1970s, more digital switching.
[33:12.270 --> 33:15.610]  The digital central office began in the 1970s.
[33:15.730 --> 33:18.210]  Anyone ever hear of Vidar, the Vidar switch?
[33:18.570 --> 33:23.830]  That was a company that built the first digital telephone switch introduced in 1976.
[33:23.830 --> 33:27.330]  Northern Telecom, the MS-10 in 1977.
[33:27.850 --> 33:32.990]  AT&T Bell system did not come until the 80s.
[33:33.310 --> 33:36.930]  Digital PBXs for private use came on the market in 1975.
[33:37.670 --> 33:41.990]  Nortel SL1, Rome CBX, and Harris had one.
[33:42.070 --> 33:42.970]  Several companies had them.
[33:43.870 --> 33:47.350]  AT&T Western Electric digitized the toll network, though.
[33:47.350 --> 33:54.730]  The 4ESS, introduced in 1976, replaced the crossbars that ran the toll network.
[33:54.970 --> 33:58.650]  The crossbars, by the way, there was something called, you know, the crossbar tandems.
[33:58.830 --> 34:01.430]  And there was something called the card translator.
[34:01.630 --> 34:02.730]  I don't have one to show you.
[34:02.930 --> 34:08.730]  But the card translator was how you would take, you know, 617-529.
[34:08.910 --> 34:09.870]  Where does that go?
[34:09.970 --> 34:11.950]  Well, that was punched into a card.
[34:12.430 --> 34:15.670]  The card was a sheet of aluminum about a foot long.
[34:15.670 --> 34:18.410]  And the metal sheets would drop.
[34:18.590 --> 34:20.950]  It had notches in the bottom and holes in it.
[34:21.110 --> 34:25.630]  And the numbers that you were dialing would cause one sheet to fall.
[34:25.810 --> 34:28.470]  And probes would find the holes and route the call.
[34:28.790 --> 34:30.730]  A metal card translator.
[34:30.970 --> 34:38.770]  So to introduce a new phone prefix, they punched a metal card, drilled and nibbled out a metal card.
[34:38.890 --> 34:40.370]  It was bizarre, but it was...
[34:40.370 --> 34:41.790]  A read-only memory.
[34:42.010 --> 34:43.990]  Yeah, it was a read-only memory made out of...
[34:43.990 --> 34:45.270]  You had trouble cards, too.
[34:45.610 --> 34:47.570]  You had a call failed trouble cards.
[34:47.590 --> 34:48.590]  Well, the trouble cards were paper.
[34:48.810 --> 34:49.830]  They punched a paper card.
[34:50.010 --> 34:50.850]  I think it had paper.
[34:51.030 --> 34:54.170]  But the card translator used metal punch cards.
[34:56.990 --> 35:03.270]  The...so they did away with that in the 4ESS when they finally went digital with T1 interfaces that didn't need a channel bank.
[35:03.410 --> 35:05.590]  They were huge because this was primitive technology.
[35:06.130 --> 35:08.730]  They were stayed in service until the past decade.
[35:08.730 --> 35:09.830]  They're now gone.
[35:10.570 --> 35:14.810]  Ma Bell didn't have local digital, the 5ESS, until the 1980s.
[35:15.490 --> 35:17.310]  And it has...and they're still in service.
[35:17.730 --> 35:18.730]  Thousands of 5ESSs.
[35:19.290 --> 35:20.970]  They were built to last 40 years.
[35:21.190 --> 35:23.970]  And frankly, they were built like the proverbial brick, you know what.
[35:24.590 --> 35:27.090]  And they do last.
[35:27.090 --> 35:31.390]  But the analog POTS lines plugged into an analog crossbar.
[35:31.610 --> 35:51.850]  Because in 1980, the codec, the function of analog to digital conversion looked so expensive, they had to use...invent a type of semiconductor, the gated diode exchange, gated diode crosspoint, that could interconnect these high voltage 90-volt ringers to these expensive codecs.
[35:51.850 --> 35:53.270]  Now, of course, the codecs are everywhere.
[35:53.470 --> 35:54.550]  It's a bizarre architecture.
[35:55.250 --> 35:59.410]  And there are thousands of these early DMSs and ESSs still in service.
[35:59.530 --> 36:02.090]  But the companies who made them, Nortel is history.
[36:02.790 --> 36:05.290]  Western Electric, which became Lucent, is history.
[36:06.010 --> 36:11.190]  Now they're, you know, Western Electric, legacy...anyone know who now owns the 5ESS?
[36:11.190 --> 36:11.770]  That's what company?
[36:12.810 --> 36:13.210]  Nokia.
[36:13.390 --> 36:13.770]  Nokia.
[36:14.050 --> 36:15.570]  Of all places, it ended up Nokia.
[36:15.990 --> 36:19.710]  They got Microsoft to buy their losing phone business for more than it was worth.
[36:19.710 --> 36:25.070]  And they bought up the residuary of Siemens and Alcatel, which included Western Electric.
[36:26.990 --> 36:32.230]  Signaling, how you send phone numbers down the line, has evolved.
[36:32.810 --> 36:35.830]  Trunk signaling was originally dial pulses, click, click, click.
[36:36.050 --> 36:37.770]  How did you send a dial pulse?
[36:38.130 --> 36:41.190]  Well, everything on an analog circuit had to be done via tones.
[36:41.490 --> 36:45.210]  So you had multi-frequency tones came out like in the 50s.
[36:45.930 --> 36:48.290]  The multi-frequency tone generator.
[36:48.370 --> 36:49.450]  Under the single frequency.
[36:49.510 --> 36:55.550]  The single frequency came out earlier than that, using 2600 hertz or 2400.
[36:55.710 --> 36:57.670]  But 26 became the U.S. standard.
[36:57.970 --> 37:02.230]  So a 2600 hertz tone indicated this line is on hook.
[37:02.390 --> 37:11.150]  So in the frequency division multiplex on those microwave networks, an idle channel was one indicated by a 2600 hertz tone.
[37:11.410 --> 37:11.530]  Right?
[37:11.530 --> 37:20.590]  That had interesting in-band properties, and we know a certain whistle of a certain serial happened to be that frequency.
[37:21.430 --> 37:25.650]  Also, pulse signaling was sent as 20 pulses, or 10 in some cases.
[37:25.790 --> 37:29.610]  But on the toll network, they could send 20 on the toll switches.
[37:29.890 --> 37:35.150]  20 pulse per second, beep, beep, beep, beep, interruptions in that 2600 hertz tone.
[37:35.570 --> 37:36.630]  Actually, it wasn't interruptions.
[37:36.710 --> 37:40.610]  It was sending the on hook that was interrupted to go off hook, and then send the dial pulses.
[37:40.890 --> 37:44.910]  But it's true that when the trunks were unused, they're all sending 2600 to each other.
[37:45.050 --> 37:48.650]  And if it fails, the 2600 goes away, then they can detect it and go fix it.
[37:48.770 --> 37:49.110]  That's right.
[37:49.390 --> 37:49.630]  That's right.
[37:49.730 --> 37:51.870]  Having a tone there was useful for maintenance purposes.
[37:52.210 --> 37:55.690]  So it was a good idea with one minor problem of security.
[37:57.210 --> 38:02.410]  And so then they introduced common channel inner-office signaling, which is sometimes called signaling system 6.
[38:02.850 --> 38:06.630]  And this is signaling messages sent on 2400 hertz...
[38:06.630 --> 38:12.570]  2400 bit per second data circuits, that's what the modem was, on an analog channel, paralleling the trunks.
[38:12.710 --> 38:16.510]  But the signaling moved out of band so that you couldn't whistle your calls anymore.
[38:16.730 --> 38:21.030]  And that was, you know, done for security reasons.
[38:21.670 --> 38:23.030]  In the 19...
[38:23.030 --> 38:25.890]  1984, I think it was, somewhere around there, that they went over to...
[38:25.890 --> 38:28.270]  Well, they were phased it out over the 70s and 80s, yeah.
[38:28.950 --> 38:31.970]  Then fiber optics replaced the microwave, okay.
[38:32.110 --> 38:33.470]  It really took over in the 80s.
[38:33.530 --> 38:37.670]  Their first use was earlier, in the 70s, the first deployments.
[38:37.890 --> 38:44.150]  But really, in the 1980s, mass production of fiber optics and the trunk networks went...
[38:44.810 --> 38:48.650]  finished, basically, in the 1990s, going to fiber.
[38:48.650 --> 38:52.090]  And leaving those AT&T microwave towers behind.
[38:52.510 --> 38:57.630]  Those are the horn antennas, sometimes called periscope antennas, that AT&T's microwave network use.
[38:57.730 --> 38:59.630]  And some of them might still be left on the towers.
[38:59.870 --> 39:01.330]  They weigh 3,000 pounds.
[39:01.570 --> 39:04.830]  Their FCC microwave rules do not allow them to be used anymore.
[39:04.950 --> 39:06.610]  I think they send too much power upwards.
[39:06.750 --> 39:10.230]  Because you point the klystron up and the periscope bends it forwards.
[39:10.810 --> 39:13.650]  It's no longer in use, no longer allowed.
[39:14.090 --> 39:16.970]  If there were some left in use from then, they'd be allowed.
[39:16.970 --> 39:19.450]  But they're not allowed... you can't build these dishes.
[39:19.610 --> 39:22.370]  Everything is a dish or pretty much a dish nowadays.
[39:23.570 --> 39:25.950]  But the big... the towers are still widely used.
[39:26.070 --> 39:28.010]  I mean, American Tower has bought up a bunch of those.
[39:28.210 --> 39:28.610]  Right?
[39:28.710 --> 39:29.450]  They're cell towers.
[39:29.650 --> 39:30.950]  They're great towers.
[39:31.470 --> 39:33.010]  They're all over the place.
[39:34.610 --> 39:35.830]  Here's the business problem.
[39:36.170 --> 39:37.010]  Introducing fiber.
[39:37.010 --> 39:42.250]  The whole business model of the phone companies was based on scarcity.
[39:43.130 --> 39:45.870]  Long distance trunks were expensive and scarce.
[39:46.590 --> 39:48.610]  Now we have near infinite capacity.
[39:49.090 --> 39:53.150]  Just need more capacity on fiber, you add what are sometimes called optronics.
[39:53.590 --> 39:56.750]  You could add more lambdas, more light wave colors.
[39:56.750 --> 40:00.530]  So the actual cost of bandwidth fell to near zero.
[40:01.110 --> 40:07.630]  And the cost, not the price, the cost per call minute, fell by more than 99%.
[40:07.630 --> 40:12.850]  But the telephone companies had a business model based on the scarcity of long distance.
[40:13.150 --> 40:18.670]  Because in 1929 that was a luxury and the whole industry was structured around that.
[40:18.670 --> 40:20.730]  So, been a problem.
[40:22.630 --> 40:28.750]  Another technology change, ISDN, Integrated Services Digital Networks, introduced in the 1980s.
[40:28.890 --> 40:33.230]  And the idea was to get rid of the analog protocols since the network was digital.
[40:33.490 --> 40:35.450]  Why shouldn't the interfaces be digital?
[40:35.750 --> 40:39.890]  So we had end-to-end digitization of the PSTN to the subscriber.
[40:40.190 --> 40:44.390]  The idea was, since it's computers at both ends, why do we have computers generating tones?
[40:44.610 --> 40:47.670]  And decoding tones when they could just send the raw bits of what they meant.
[40:47.670 --> 40:49.050]  Totally logical.
[40:49.250 --> 40:50.950]  Remove the vestiges of analog signaling.
[40:51.270 --> 40:52.570]  It happened in Japan.
[40:52.790 --> 40:53.790]  It happened in Europe.
[40:53.850 --> 40:55.210]  It did not happen in the U.S.
[40:55.990 --> 41:00.790]  A call on the network is, of course, a 64,000 bit per second channel.
[41:00.970 --> 41:02.410]  Because that's what T1 carrier needed.
[41:02.750 --> 41:05.650]  The PSTN is all about 64 kilobit channels.
[41:06.090 --> 41:08.070]  ISDN was 64 kilobit channels.
[41:08.210 --> 41:09.770]  Offered in raw bit form.
[41:09.930 --> 41:10.930]  You could carry voice.
[41:11.090 --> 41:13.230]  You could carry data as common carriage.
[41:14.330 --> 41:15.270]  This caught on.
[41:15.390 --> 41:16.870]  Analog lines were largely digitized.
[41:17.730 --> 41:21.510]  The backbone inner switch signaling was signaling system 7.
[41:21.710 --> 41:22.870]  That did catch on.
[41:23.030 --> 41:23.770]  That's in use today.
[41:24.010 --> 41:28.210]  That's a dedicated packet switch network for inner office signaling.
[41:28.510 --> 41:30.670]  It's also used for texting.
[41:30.950 --> 41:34.930]  Had the ability to send little 160 character messages.
[41:35.270 --> 41:36.610]  That's where texting came from.
[41:36.610 --> 41:41.090]  The American telephone companies, though, mostly hated ISDN.
[41:41.290 --> 41:43.430]  The one exception being Centrex lines.
[41:43.670 --> 41:46.790]  Centrex being central office emulating a PBX.
[41:47.550 --> 41:49.850]  Bell Atlantic was all about Centrex.
[41:49.950 --> 41:52.170]  So they would only do ISDN for Centrex.
[41:52.330 --> 41:56.150]  Most of the other companies still mostly liked it for Centrex.
[41:56.350 --> 41:56.910]  Why?
[41:57.050 --> 41:58.270]  Why didn't they want to do it?
[41:58.270 --> 41:59.750]  This is the 80s.
[41:59.930 --> 42:02.230]  Dial up data and that new Internet thing.
[42:02.370 --> 42:04.150]  It was the 90s when it was actually in production.
[42:04.350 --> 42:05.230]  Early 90s.
[42:05.330 --> 42:06.530]  The switches are ready.
[42:06.830 --> 42:10.370]  ISDN's phasing in just as the Internet goes public.
[42:10.610 --> 42:15.450]  The whole AUP issue on the Internet backbone had been solved in 92.
[42:16.170 --> 42:18.410]  ISP started popping up like crazy.
[42:18.910 --> 42:20.950]  ISDN was a perfect fit.
[42:20.950 --> 42:22.830]  Better than modems.
[42:23.330 --> 42:24.690]  Well, Bell saw that.
[42:24.870 --> 42:26.210]  They wanted to stop the Internet.
[42:26.390 --> 42:28.310]  So they suppressed ISDN.
[42:30.130 --> 42:31.710]  Instead, people used modems.
[42:31.790 --> 42:32.870]  They couldn't suppress the Internet.
[42:32.870 --> 42:34.410]  They just made it work worse.
[42:35.130 --> 42:38.710]  And ISDN was still the PSTN of evolution.
[42:39.750 --> 42:47.810]  Since the 1990s, the technological development has been voice over IP and voice using IP.
[42:47.810 --> 42:50.190]  Let me introduce that term if you're not familiar with VUP.
[42:51.250 --> 42:53.390]  Local competition opened in 1996.
[42:53.970 --> 42:58.710]  And that meant that all these new telephone companies were a market and new vendors.
[42:58.910 --> 43:01.130]  I counted in 2000.
[43:01.130 --> 43:05.190]  I was doing a project for a client who was opening a network.
[43:05.370 --> 43:06.770]  And they, you know, who were the switch vendors?
[43:06.930 --> 43:11.810]  I identified 12 new companies building central office switches.
[43:12.010 --> 43:13.310]  Or at least trying to.
[43:13.530 --> 43:14.990]  Some of them never got to market.
[43:15.150 --> 43:16.690]  And many of them failed.
[43:16.690 --> 43:19.190]  But everybody was trying to get into the act.
[43:19.290 --> 43:24.870]  Between 1997 and 2000, everyone was trying to get into the act of building central office switches.
[43:25.490 --> 43:29.010]  But they were mostly using IP.
[43:30.230 --> 43:33.730]  Not exclusively, but had IP interfaces.
[43:34.030 --> 43:36.690]  That's what Wall Street wanted.
[43:36.690 --> 43:51.410]  And I cannot find this, but there was once a Lucent flyer that for IP attachment to the 5ESS that carried IP from one cabinet to another where it was converted back to PCM.
[43:51.570 --> 43:53.650]  Three feet of IP in the middle.
[43:53.850 --> 43:58.130]  And their justification written down on their Wall Street image.
[43:58.130 --> 44:00.170]  They said, you're using VoIP.
[44:00.310 --> 44:00.930]  That was sexy.
[44:01.670 --> 44:02.270]  Okay.
[44:02.970 --> 44:07.190]  Voice over IP usually means voice over an existing IP network.
[44:07.410 --> 44:08.890]  Like voice over the Internet.
[44:09.370 --> 44:09.970]  Vonage is.
[44:10.130 --> 44:12.810]  A better term for that, I think, is parasitic VoIP.
[44:13.130 --> 44:16.770]  It provides a low tier phone service over others.
[44:17.110 --> 44:18.390]  Others are paying for it.
[44:18.450 --> 44:22.510]  Others are providing the IP best efforts, scare quotes, required service.
[44:23.590 --> 44:27.550]  Voice using IP, VoIP, is managed.
[44:28.150 --> 44:31.110]  It's the IP network replaces TDM.
[44:31.330 --> 44:32.210]  What's IP?
[44:32.550 --> 44:35.850]  Internet protocol IP defines a multiplexing header.
[44:36.090 --> 44:37.430]  That's all that IP is.
[44:37.510 --> 44:38.510]  IP is not a protocol.
[44:38.950 --> 44:40.990]  IP is a multiplexing header.
[44:41.270 --> 44:49.130]  So instead of using time division multiplexing, you use IP packets to multiplex the physical medium.
[44:49.350 --> 44:50.790]  But not the Internet.
[44:50.790 --> 45:03.210]  It's carried at high quality of service, reserved bandwidth, not intermixed with bursty data, unlike the ESQR, best efforts, square quotes, required, IP.
[45:03.570 --> 45:08.110]  It's IP in name, but it's nothing like the IP of the Internet.
[45:08.770 --> 45:16.970]  Packet cable, which is how cable companies carry telephone calls, is VoIP, dedicated high quality service.
[45:17.090 --> 45:18.590]  I have a fax machine on packet cable.
[45:18.590 --> 45:19.710]  It works great.
[45:20.870 --> 45:26.110]  Voice over LTE, which is being phased into the 4G mobile, is largely VoIP.
[45:26.490 --> 45:28.610]  It's, again, carefully managed IP.
[45:29.890 --> 45:34.570]  Fios and U-verse sometimes use IP for the voice service.
[45:34.770 --> 45:35.550]  Again, it's managed.
[45:35.710 --> 45:36.230]  It's not Internet.
[45:37.650 --> 45:40.430]  So VoIP is transparent to end users.
[45:40.430 --> 45:43.250]  It works just like TDM with a tiny bit more latency.
[45:43.770 --> 45:46.070]  It's like 15 extra milliseconds of latency.
[45:46.290 --> 45:47.950]  But it works with modems and fax.
[45:48.090 --> 45:49.450]  So it's high quality service.
[45:50.850 --> 45:56.630]  Signaling System 7, which is a... my nickname for the protocol was the protocol from hell.
[45:56.870 --> 45:58.790]  If you ever tried to actually look at the specification.
[45:59.190 --> 46:00.530]  It's giving way to SIP.
[46:01.150 --> 46:03.370]  SIP is the standard protocol nowadays.
[46:05.010 --> 46:09.370]  But it was based... it was based on 1980s...
[46:10.850 --> 46:13.470]  Well, SS7 was 1980s.
[46:14.190 --> 46:16.630]  But SIP looks like 1970s.
[46:16.710 --> 46:17.390]  ASCII headers.
[46:17.630 --> 46:23.390]  Because whoever invented SIP, Henning Schulzer, didn't know there was such a device as a protocol analyzer.
[46:23.530 --> 46:26.350]  And so they would, you know, look at the headers on a serial port.
[46:26.350 --> 46:28.650]  Because that's how people thought in those, you know.
[46:28.990 --> 46:30.390]  And this is done around 2000.
[46:30.390 --> 46:34.390]  So it's a backwards throwback in band text protocols.
[46:35.090 --> 46:36.870]  But then it goes well with IP.
[46:37.090 --> 46:39.190]  IP is older than TDM.
[46:39.310 --> 46:41.650]  IP came out in 1974.
[46:42.610 --> 46:46.150]  IP version 4, the only one that works, came out...
[46:46.150 --> 46:48.050]  Anyone know what year IP version 4 came out?
[46:50.170 --> 46:50.710]  1978.
[46:51.610 --> 46:55.590]  That's the current and final real version of IP.
[46:55.590 --> 46:57.390]  It's 1978.
[46:57.990 --> 47:00.530]  And the FCC thinks we're modernizing the network?
[47:01.890 --> 47:05.230]  Okay, let's look at what the FCC and state regulators have done.
[47:06.230 --> 47:08.850]  They introduced something called price cap regulation.
[47:09.170 --> 47:19.930]  Instead of the rate of return system of utilities, in the rate of return, a telco was entitled to earn a profit margin on their rate base.
[47:20.050 --> 47:22.950]  And rate base was the undepreciated value of their plant.
[47:22.950 --> 47:25.970]  The more investment, the more profit.
[47:26.250 --> 47:28.250]  There was a risk of padding the rate base.
[47:28.390 --> 47:29.250]  They were gold plating.
[47:29.250 --> 47:37.990]  But, oh yes, we'll spend $100,000 to feed these 10 houses, bring a cable out 10 miles to the subdivision, and sell them service for $8 a month.
[47:38.110 --> 47:43.390]  Because the $100,000 went on to the rate base, and all their customers shared in the price.
[47:44.150 --> 47:48.190]  Monopoly profits in some areas ensured that it was profitable overall.
[47:48.790 --> 47:53.630]  But, in the 90s, they saw that the cost was going down.
[47:54.030 --> 47:55.410]  Everything was getting cheaper to build.
[47:55.530 --> 47:56.830]  Computers and switches were getting cheaper.
[47:57.010 --> 48:00.290]  So, please free us from this rate of return limit.
[48:00.470 --> 48:02.390]  They were given price cap regulation.
[48:02.610 --> 48:11.450]  They could earn whatever profits they wanted, as long as the retail price of basic service, and the wholesale price stayed under a cap.
[48:11.810 --> 48:12.870]  At least temporarily.
[48:13.510 --> 48:18.870]  There was therefore no rate base anymore, and therefore no incentive to invest.
[48:19.830 --> 48:21.510]  And there's been almost no investment.
[48:21.710 --> 48:23.770]  And the plant is very deteriorated.
[48:24.450 --> 48:31.350]  The quality of the pot lines in rural America, where it's not profitable, and even in some cities, has gone way down.
[48:31.530 --> 48:37.830]  As far as depreciation, they've actually managed to exceed 100% depreciated, which is possible.
[48:38.050 --> 48:39.570]  I don't know how, but it is.
[48:39.710 --> 48:42.610]  In some places, they're between 95% and 100% depreciated.
[48:42.870 --> 48:44.290]  There's been very little investment.
[48:44.870 --> 48:46.450]  They've laid off staff right away.
[48:46.730 --> 48:49.250]  After, you know, in the 90s, huge layoffs.
[48:49.430 --> 48:49.870]  They're still...
[48:50.470 --> 48:54.710]  The telephone companies have a tiny fraction of the number of technicians they had 25 years ago.
[48:55.710 --> 48:57.730]  And that raises the profits levels.
[48:57.890 --> 49:00.250]  But less maintenance, long-term issues.
[49:00.470 --> 49:02.350]  The chickens are coming home to roost.
[49:03.030 --> 49:06.570]  The sunset of the PSTN is decay.
[49:07.050 --> 49:22.990]  It's caused by this malign neglect, not maintaining the network, milking the installed plant for all it's worth, because you're rewarded by Wall Street for next quarter's profits, not what's left in your asset base 20 years from now.
[49:23.250 --> 49:25.450]  The assets have gone to zero.
[49:26.270 --> 49:29.810]  Telephone company accounting makes Tolkien look like non-fiction.
[49:30.010 --> 49:31.630]  It's that much of a fantasy.
[49:33.250 --> 49:35.410]  Personal telephones, of course, are now mobile.
[49:36.190 --> 49:39.410]  Wireline use among residential and personal users in decline.
[49:39.670 --> 49:41.930]  Most young people only have mobile phones.
[49:42.250 --> 49:44.470]  Businesses, though, need wireline to receive the calls.
[49:44.610 --> 49:46.110]  The wireline network is very important.
[49:46.590 --> 49:49.410]  Wireless is mostly fiber, except for the last mile.
[49:49.530 --> 49:50.490]  It's PSTN.
[49:50.950 --> 49:54.570]  Mobile calls get preferential treatment.
[49:55.110 --> 49:55.750]  Bill and keep.
[49:55.950 --> 49:58.590]  Note in charge for intra-MTA.
[49:58.590 --> 50:05.510]  MTA, major transport area, 50 of the 50 areas in the country, based on Rand McNally's commercial atlas.
[50:05.990 --> 50:09.610]  So greater New York up to New England, local call on mobile only.
[50:10.630 --> 50:14.630]  They abolish long-distance charges, therefore, and so is more competitive.
[50:15.230 --> 50:16.970]  Mobile's also more profitable.
[50:17.150 --> 50:19.490]  They upsell you to the data services.
[50:20.350 --> 50:21.570]  People value mobility.
[50:21.870 --> 50:24.950]  AT&T and Verizon push it instead of wireline.
[50:24.950 --> 50:31.890]  People are willing to pay more and pay for block-of-bite rates for mobile they wouldn't pay for on a wireline service.
[50:32.150 --> 50:34.990]  And mobile devices are sexy, right?
[50:35.390 --> 50:36.550]  But they're toys.
[50:37.370 --> 50:39.750]  But they suck for talking on.
[50:39.850 --> 50:41.570]  They have terrible voice quality, for the most part.
[50:42.070 --> 50:48.210]  You've got generations who mostly text the kids now because they don't know what a phone call is supposed to sound like.
[50:48.470 --> 50:49.170]  They don't know.
[50:49.290 --> 50:51.210]  The PSTN sounded good in the 90s.
[50:51.610 --> 50:53.650]  It's hard to buy a wireline phone.
[50:53.650 --> 50:55.470]  My office phone's a terrible piece of crap.
[50:55.770 --> 50:57.690]  You don't sell good wireline phones in the store.
[50:58.170 --> 50:59.470]  Magic pixie dust.
[50:59.670 --> 51:00.930]  IP in the network.
[51:01.190 --> 51:04.050]  The IP... because the Internet's not regulated.
[51:04.250 --> 51:05.090]  It uses IP.
[51:05.530 --> 51:06.710]  Don't regulate us.
[51:07.030 --> 51:07.870]  We're IP.
[51:08.390 --> 51:13.810]  Oh, except now they regulate the Internet because the network neutrality advocates didn't know what they were asking for.
[51:14.050 --> 51:16.970]  But the regulators don't regulate the telecom.
[51:17.230 --> 51:20.970]  Well, they sprinkle this IP magic pixie dust into the PSTN.
[51:20.970 --> 51:23.130]  An IP is a multiplexing header.
[51:23.370 --> 51:26.290]  In the FCC's world, they don't know a transistor...
[51:26.290 --> 51:28.370]  Oh, well, a transistor radio is one thing.
[51:28.630 --> 51:31.770]  Everything with transistors is a transistor, right?
[51:31.910 --> 51:32.170]  No.
[51:32.710 --> 51:34.890]  IP is many things, like transistors.
[51:35.370 --> 51:36.530]  What's coming next?
[51:36.690 --> 51:41.910]  The FCC has an open docket called Sunset or Tech Transition Technologies.
[51:42.550 --> 51:44.550]  IPs can use IP internally.
[51:46.390 --> 51:47.750]  Well, they've been doing so.
[51:47.910 --> 51:56.190]  But now they're told they don't even have to be able to support fax or modems, alarm systems, any of these other non-voice applications after 2025.
[51:56.470 --> 51:57.610]  They wanted to get rid of it today.
[51:57.770 --> 52:00.370]  But they were... this is the FCC being pro-consumer.
[52:00.510 --> 52:04.050]  You must give us until 2025 to use the PSTN.
[52:04.190 --> 52:08.010]  Then the quality can go to hell in a Montana handbasket, whatever.
[52:08.690 --> 52:11.150]  Line power no longer required on the phones.
[52:11.410 --> 52:14.890]  All they have to do is make it possible to put a battery in the device.
[52:15.110 --> 52:16.370]  You have to buy it.
[52:16.510 --> 52:18.790]  They can make it hard... you can be hard to find it.
[52:18.990 --> 52:23.530]  As long as there's a possibility of battery powering it yourself, that's all the protection you need.
[52:23.890 --> 52:30.710]  And states that allow it, the ILEX are abandoning copper and telling users to go cellular, move to the VoiceLink service.
[52:30.950 --> 52:32.250]  Just a little black box.
[52:32.970 --> 52:36.070]  And maybe the ancient long-distance concepts will go away.
[52:36.070 --> 52:38.250]  Local number portability is coming.
[52:38.390 --> 52:43.090]  That whole subsidy, cross-subsidy, is finally maybe nearing an end.
[52:43.290 --> 52:46.550]  Because people take their... there's a great XKCD about that.
[52:46.790 --> 52:48.550]  Local number portability is the rule.
[52:48.750 --> 52:50.450]  National portability is coming.
[52:51.110 --> 52:56.130]  And then, you know, they'll have to change the way they do the initiating dip rather than terminating dip.
[52:56.830 --> 53:00.090]  You'll know the ILEX will find a way to squeeze competitors with this.
[53:00.210 --> 53:01.110]  They always do.
[53:01.310 --> 53:04.530]  And the hackers will always remember the good old days.
[53:04.730 --> 53:05.150]  Thank you.
[53:11.900 --> 53:13.160]  I know that time is tight.
[53:13.380 --> 53:16.080]  Any quick questions before the next person comes up here?
[53:16.120 --> 53:17.240]  One minute.
[53:17.240 --> 53:17.660]  One minute.
[53:18.440 --> 53:24.000]  What's inside the enormous central office buildings that used to house all of the interface to your Christie Fair?
[53:24.220 --> 53:26.020]  There's a DSLAM on every corner now.
[53:26.260 --> 53:26.420]  Right.
[53:26.780 --> 53:27.840]  There's a lot of empty space.
[53:27.940 --> 53:29.220]  It's just a big empty warehouse.
[53:29.220 --> 53:30.440]  They could be in the data...
[53:30.440 --> 53:34.440]  If they were smart, they'd go into the, you know, real estate business.
[53:34.440 --> 53:34.860]  They have.
[53:35.020 --> 53:35.720]  They've sold some off.
[53:36.100 --> 53:36.920]  In New York, they have.
[53:37.240 --> 53:37.960]  They have.
[53:38.120 --> 53:39.620]  I actually work for a large island.
[53:39.620 --> 53:39.980]  Yeah.
[53:40.840 --> 53:41.300]  Yeah.
[53:41.520 --> 53:42.440]  It's data space.
[53:43.120 --> 53:44.300]  But many they aren't even using.
[53:46.320 --> 53:47.240]  Two minutes left.
[53:47.240 --> 53:48.000]  Oh, oh, oh.
[53:48.020 --> 53:48.440]  Two minutes left.
[53:48.500 --> 53:48.980]  Any more questions?
[53:49.500 --> 53:50.420]  I knew I'd see you here.
[53:50.420 --> 53:50.960]  Any more questions?
[53:51.480 --> 53:54.420]  Oh, is ISDN still being provisioned?
[53:54.640 --> 53:55.020]  No.
[53:55.500 --> 53:58.200]  Oh, actually, ISDN basic rate is no longer available.
[53:58.200 --> 54:03.880]  The retail 2B plus D lines, some of them are grandfathered, but they're no longer being made available.
[54:03.880 --> 54:09.820]  But primary rate caught on, and therefore, the standard PBX trunk is primary rate, and that is still available.
[54:10.020 --> 54:10.260]  Okay.
[54:10.260 --> 54:11.620]  And the CLEX can provide that too.
[54:11.760 --> 54:11.940]  Sure.
[54:13.480 --> 54:14.900]  Does your plans rise to...
[54:14.900 --> 54:15.920]  Hacking housing is up next.
[54:16.060 --> 54:18.400]  We're going to have to get the next talk in here, but you're welcome to stand out.
[54:18.620 --> 54:18.820]  Okay.
[54:18.940 --> 54:19.300]  Yep.
[54:19.580 --> 54:19.680]  Yep.
[54:19.800 --> 54:20.720]  Let me just put myself away.
[54:20.760 --> 54:21.900]  Absolutely no rush to leave.
[54:22.140 --> 54:22.460]  Oh, yeah.
[54:22.540 --> 54:23.460]  Other than maybe right here.
[54:23.740 --> 54:23.900]  Yep.
[54:24.100 --> 54:24.300]  Oh, no.
[54:24.380 --> 54:25.000]  I'm giving the space up.
[54:25.160 --> 54:25.660]  The next guy.
[54:25.860 --> 54:26.040]  Okay.
[54:26.940 --> 54:27.300]  Disconnect.