A Practical Navigator for the Internet Economy

NYNEX Internet Plans pp. 1-9

We interview Carl Ford, Staff Director Product Development, NYNEX Business Markets. Carl has been responsible for the development of NYNEX's Internet strategy which is expected to have a formal launch in the autumn. NYNEX is planning an IP dial tone.

To ISPs in its service area it will say let us provide your modem pools and terminal servers. It suggests that this will save new ISPs some of their capital start up costs and benefit NYNEX by avoiding it having to install 50 and 100 pair cables into homes residential neighborhoods. At the same time such a dial tone will also enable NYNEX to be a player in connecting telecommuters to corporate networks. This could be done by AT&T's Netware Connect Services (ANCS) or "by other means" which is how he phrased his response when we asked him if ANCS was in the picture.

He talks about solving the inter LATA MFJ restrictions by creating an Internet hub within each LATA and inviting entities like NEARnet and NYSERnet to connect to each of them. He indicates that NYNEX is plainly interested in moving into network management services for ISPs. Levels 3 through 5 will provide NYNEX with financial oppportunities that basic transport does not. Yet he says it is not NYNEX's intention to try to move into areas where existing ISPs are comfortable in providing their own services. Rather he wants to provide services to enable new and less experienced ISPs to test the marketplace.

NYNEX services will be provided through frame relay PVCs. Basic services with be provided through what NYNEX is calling Open Net. Safe Net would add commercial web servers and strong network security of the type that would interest large commercial clients. NYNEX Net would be a full blown NYNEX internet service. Ford considers NYNEX Net unlikely in the near term. He paints NYNEX's philosophy as Jeffersonian and decentralized in contrast to a head end strategy that says we know best what the whole world needs.


NYNEX Critique pp. 10 - 16

Gordon Jacobson is a New York City based telecommunications consultant who has been studying the ISP marketplace very closely. We asked him to read and comment on our interview with NYNEX. He did so extensively providing an overview and annotated commentary that is only about 20% shorter than the original interview.

Basically Gordon finds NYNEX's strategy to be one of setting itself up in business to become a giant ISP in a couple of year's time. He asserts that the cost savings to an IP startup of not having to provide its own modem pool and terminal server are not that great. He warns that ISPs who buy the NYNEX service are in effect placing their customers in NYNEX hands - ripe for the taking when and if NYNEX introduces a full blown NYNEX Net.

He states: "While it may be true that NYNEX's offer may allow all of the Tom, Dick and Harrys to become ISPs, that possibility begs the question: "Should the marketplace become so fractionalized by little providers servicing ten and twenty customers that there are not enough substantive providers around to stand up to the majors if and when they try to "corner the market?"

He vigorously disagrees with Ford's discussion of regulatory and technical issues that will influence the pricing of NYNEX servcices. He paints the strategy as that of the wolf in sheep's clothing and despite Ford's protestations of being a Jeffersonian finds his model to be one of top down design. He takes Ford's assertions about backbone bandwidth weaknesses and an inherent need for settlements and shows why he believes them to be technically inaccurate.

He is not impressed by Ford's assertion that while NYNEX would not charge users for megabytes sent and received, it likely would place a hourly charge on port usage beyond some to be defined limit. He does find NYNEX's designs for a Safe Net to be a desirable business market place niche for it to fulfill. Overall he feels that Ford may have floated some trial balloons with us and suggests that NYNEX needs to do a much more thorough job of researching what subscribers and ISPs are asking for, what they actually need and what the time frames are in which their needs realistically must be met.


AT&T's Internet Strategy pp.1, 17 - 20

We present a literature review of AT&T's partnership with Novell in the development of AT&T NetWare Connect Services (ANCS) now in beta test with Ziff Davis, Hallmark Cards, and Millard Refigeration.

By moving TCP/IP into the Netware kernel, ANCS promises to offer corporate, university and governmental LAN managers a seemless and easy way to connect their LANs into a wide area network, one which, because it can be run across AT&T's huge global network, offers the prospect of a private Internet with better security services than the publicly available global Internet. A niche market for AT&T. But a huge and lucrative one. AT&T also has a WAN version of Lotus Notes called Network Notes. According to one of the trade journals AT&T is positioning it to compete with the Microsoft Network.

Why is ANCS important? As explained in the March 27 Computer Reseller News, TCP/IP has been given "equal footing with IPX in NetWare environments by unbundling IPX from the NetWare Core Protocol (NCP) so that IP can be tightly coupled with NCP. . . "

We were surprised by the general lack of awareness of ANCS among technical Internet sources whom we querried. Connecting NetWare LANs to the Internet is done all the time. However under the IPX version of NetWare, the process is kludgy and time consuming. If ANCS works as advertised, and if AT&T prices it attractively, it should create a potentially major market, they all agreed. Another unknown is the kind and extent of linkage to the global Internet that ANCS will offer its customers. There will surely be some linkage. However, the ANCS developments represent yet another fragmentation of the Internet into private value added services. We wonder if a time may be reached when the public internet becomes a less valuable commodity because of this fragmentation?

We have also heard rumors that AT&T is going to launch a major dial up gateway to the Internet and other AT&T network services before the end of the summer. Tom Evslin VP of Network Services and Marni Ehrlich, ANCS Marketing Director were frequently mentined in the trade literature on ANCS. Erik Grimmelmann the PI on AT&T's portion of the InterNic and the AT&T insider we have known as responsible for AT&T's Internet strategy since February of 1992 was never mentioned. Yet when we called into AT&T we found that Ehrlich reports to Grimmelmann who in turn reports to Evslin. This confirmed our belief that AT&T at last does have an internet strategy worth noticing and that it is ANCS.


Colorado Study Part 3 pp. 21 - 22

This two page installment concludes our interview with the State Librarian. It contains the interview with Guy Cook of Colorado Supernet and begins the interview with Ken Klingenstein.