SBC Total ConnectionsOffers Value, Convenience & Choice

• Bundle Now Available with Initial Annual Savings Ranging from$276 to $575 & One Bill

• Combines Discounts and SBC Yahoo! DSL or Dial,CingularWireless, Long Distance or Local Toll, Unlimited LocalCalling, Call Management Services, DISH Network Digital Satellite

SBC Communications Inc. recently announced an evolution inits packaging strategy designed to retain and attract new customers in today’s competitive marketplace by rewardingthose who consolidate their communications services with SBCwith significant discounts, extensive customization optionsand unparalleled convenience.

Called SBC Total Connections, the new marketing initiativewill deliver to consumers integrated bundles that combine thesimplicity of one bill and one call, expanded choice from abroad array of communications services, and the company’sbest available pricing.

Your Success Is Our Mission,We’ll Always Be Here SharingYour Vision

“HAPPY NEW YEAR”To our readers, I want to personally wish

each and every one of you a very Happy New Year and hopethat you & your family and clients have the most successfuland joyful year ever in 2003. We’re here to help you maximizethat success. Please call our Liaison Managers (1-800-552-5299)to assist you in your projects; to subscribe to our Listserver forBreaking Telecom News and to get you a Password for specialaccess to CV Web Connect, where you can get the latest SBC& industry news, pricing, promotions, product news plusmuch more (even this UPDATE). Also, be sure and participatein our Streaming Media Broadcasts (the next one features SBCLong Distance on Feb. 19th from 9-11:30am PST; call yourLiaison Manager for the URL or 1-888-889-6010 for additionaldetails).

ALWAYS HERE FOR YOU

We’ve been helpingbusiness and residentialcustomers for 125 years.The SBC heritage as alocal operating companydates back to Jan. 28,1878, when the world’sfirst commercial switch-board was launched inNew Haven, Conn.

From February throughAugust of 1878,exchanges were established in San Francisco, St. Louis,Chicago and Detroit. These small local exchanges were theproud predecessors of SBC today. SBC Communications(www.sbc.com) has grown to be one of the World’s leadingdata, voice and Internet services providers.

Inside DSL Data..............................................................................................Perils of E-Mail.................................................................................... 3CV Web Connect: Web site for Consultants............................................. Ethernet Passive Optical Networks.................................................... 6Grid Computing..................................................................................8Health-Oriented Technologies.......................................................... 10SBC Tests Internet Security.............................................................. 11Sterling Commerce Global Partners................................................... 11Selling Solutions................................................................................2SBC & Yahoo!......................................................................SBC Executive News.......................................................................3Paying Bills Online........................................................................4Data With David: Integrated Access.........................................Vendor Spotlight: SBC & 3com........................................................SBC Telecom Glossary ...........................................................

Vice President ‘s Corner

Kari WatanabeCVSG Vice President

continued on page 2

SBC National DataTransport Portfolio Enhanced

SBC has introduced an enhanced, standardized portfolio ofnational data transport solutions furthering its ongoingstrategy to deliver to business customers a new class ofintegrated data and IP networking services on a national basis.These enhanced national data services, including new SBCFrame Relay, ATM and Private Line offerings along with thecompany's supporting data backbone networks, are critical inproviding fully integrated communications services for

continued on page 3

Frustrated or Satisfied - How Does Your CallRouting System Affect Your Customers?

Wouldn’t you like to know what your customers really think ofyour company? Well, there’s an easy way to find out. Try thisexperiment. Call your company’s direct line and listen. Whatdo you hear? Is it a recorded voice that sends you down a blackhole of confusing menu options? Or is it a professionally

SBC Moves to a Single National Brand (p.18)

1-800-CONFERENCE® Announces Streaming Services Powered By Yahoo! (See back cover)

Craig Tanikawa & Michelle Walker-Martin

continued on page 17

continued on page 2

SBC Long Distance Streaming Media Broadcast Feb. 19th (see back cover)

page 2 page 3page 4page 6page 8page 10page 11page 11page 12page 13page 13page 14page 15page 16page 19

At your service in 1915

UPDATEConsultant/Vendor Sales Group

January 2003

As of third quarter 2002, more than 7million, or 22 percent, of SBC’scustomer base subscribed to a distinctpackage or bundle from SBC, creatingsignificant potential for the company toincent customers to aggregate theirservices with SBC or opt for bundlesinstead of buying services on an“a la carte” basis. According to independ-ent research, approximately 60 percentof consumers are interested in purchas-ing packages or bundles.

SBC Total Connections, the first bundlein the new SBC Connections family ofbundles, combines SBC Yahoo! DSL orDial, Cingular wireless, a low cents-per-minute long distance or local toll rate,unlimited local service and home phonecalling features, where these services areavailable, starting at about $85 a month -for initial annual savings starting at$276. Depending on the state and theproducts and enhancements customersselect, initial annual savings potentiallycan be as high as $575.

With SBC Total Connections, customersare able to personalize it to meet theirneeds; for example, they can add callingfeatures like voicemail, or select frommultiple wireless and long distancecalling plans. Additional services andenhancements will be offered at thecompany’s best available pricing at thetime. The bundle is available via a singlecall and is all on one bill. Customers alsocan choose to add satellite TV entertain-ment through DISH Network; chargesfor that service will appear on a separatebill.

“SBC Total Connections is the best dealof its kind on the market - a deal noother provider in our service area cansurpass,” said Ray Wilkins, president,SBC Marketing and Sales. “But in thespirit of choice, we also offer a variety ofother bundles, which also feature greatvalues, convenience and customizationoptions. Our goal is find the ‘rightsized’plan for each customer.”

SBC Total Connections is now availableto new and existing customers. Itcurrently is available in all regions thecompany serves except Connecticut,where it will be available in the future,and in markets where services areavailable. The bundle includes termagreements for certain products,including SBC Yahoo! DSL andCingular Wireless service.

Today, a significant number ofconsumers in SBC’s regions obtain theirlocal service from one company, theirwireless services from another, and theirlong-distance services from yet anotherprovider. The ability to aggregate someor all of these services and receive

significant discounts, a single bill and asingle point of contact represents a newchoice, savings and convenience forconsumers. In fact, the broad range ofcommunications services that will bemade available makes the SBCConnections family of bundles unique inits marketplace - whether compared withdirect competitors such as cablecompanies, long distance companies orcompetitive local exchange companies.

“There’s significant upside opportunityfor the provider that can crack the codeon bundles and offer something otherthan a ‘one-size- fits-all’ package orbundle, and we believe SBC TotalConnections and the new SBCConnections family of bundles willdeliver what consumers really want,”said Wilkins.

The company expects to offer additionalenhancements to SBC Total Connectionsand new bundles under the SBCConnections family in the near future,including new long distance calling plans(where long distance is available)allowing for unlimited night and week-end calling and bundles that blur thelines between wireless and wireline.

For further details on SBC TotalConnections’ availability and requirements,contact your SBC Consultant LiaisonManager (1-800-552-5299.)

continued from page 2SBC TOTAL CONNECTIONS

DSL DATAREPORT

2002 was a turbulentyear for SBC. We hadmany successes and

some lows across the market. It was nodifferent in the DSL environment, how-ever we ended the year on a high note.Between April and September we grewover 400,000 DSL lines. Our marketshare has increased month over monthsince the SBC Yahoo! Alliance. We alsoended the year with the announcementthat SBC would start this year off in theLong Distance market. One bill, one call,countless choices.

SBC Yahoo! Migration…

Now, all SBC Internet customers canbenefit from SBC Yahoo! DSL or SBCYahoo! Dial service. Effective November18, 2002, all existing legacy SBCInternet Services DSL customers wereable to migrate to the SBC Yahoo! portalvia a download URL. Customers werenotified by email and postcards. Theweb-based download version is simple touse, quick to complete and gives eachcustomer the choice of components todownload for their SBC Yahoo! DSLexperience. Below are the minimumsystem requirements for basic download.Other software components havedifferent minimum system requirementsthat are listed online during thedownload process.

Minimum System RequirementsFor Basic Download

Windows or Mac with Internet Explorer5.0 and above 256 Color adapter with800 x 600 resolution.

A CD option for upgrading will becoming sometime this month. Look forinformation in your mailbox.

If customers would like to take a tour ofthe SBC Yahoo! product, you can referthem to http://yahoo.sbc.com/.

Introducing Symmetrical 384 X 384…Mid-month, SBC will introduce a new

“HAPPY NEW YEAR”

SBC Yahoo! Highlights• 110 MB on-line storage• Parental Controls+Virus Software• 3 premium listings in both SBC Y!

Classifieds & SBC Y! Auctions• 2 select premium services like Bill Pay,

Games Membership and additionalon-line storage

• 20% discount on additional Premium Services

Cassandra Jessie-Johnson, SBC

Through our World Class network, SBCcompanies now provide a full range ofvoice, data, networking and e-businessservices, as well as directory advertisingand publishing. A Fortune 27 Company,America’s leading provider of high-speedDSL Internet Access services and one ofthe country’s leading Internet ServiceProviders, SBC companies currentlyserve nearly 60 million access linesnationwide. In addition, SBC owns 60percent of Cingular Wireless, whichserves more than 21 million wirelesscustomers. Internationally, SBC hastelecom investments in 28 countries.Amazing how our company grew, thanksto the foresight of a few creative andcourageous individuals who had a dream.And all of you and your predecessorsmade this happen in our continuouseffort to enable our customers to be allthat they can be. For this, we say:

“Thank You.”

(415) 542-4516e-mail: kw6875@sbc.com

continued from page 2VICE PRESIDENT’S CORNER

2

Janu

ary

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leadership by expanding the availabilityof DSL Internet access service. To date,the service is available to more than 28million customer locations. In October2002, SBC held the honor of being thefirst provider to reach 2 million DSLInternet subscribers, even in the face ofa weak economy. At the end of themonth, we had nearly 1,780 RemoteTerminals (RTs) with over 10,760Distribution Areas (DAs) ready forservice, in ASI West and SBC(California) and SBC (Nevada). Formore information, to qualify yourcustomers for SBC Yahoo! DSL InternetService, as well as to order the servicefor your clients, contact the UniqueServices Center South ConsultantQueue at 1-866-234-4DSL (4375).

Cassandra is Associate Director—Voice &Data Solutions, SBC

The Perils ofE-mail

I imagine we all have a bit of a love/haterelationship with E-mail. I can contributethis article to Update by sending it in as anE-mail attachment. I can coordinate meet-ings and communicate with friends orcolleagues in different Time Zones. But allthat junk mail and all those viruses… Thisarticle will discuss many of the realproblems that come our way through ourE-mail systems.

Viruses

A computer virus is an executable codewritten deliberately to cause a computerto do something that the owner does notwant. The damage can vary from trivialannoyances such as ridiculous pop-upreminders to go to lunch to catastrophicdestruction of the contents of diskdrives. Virus techniques have developedand evolved as our technology has. Thewriters make use of the most commontechnologies to infect the most people inthe shortest time. There's always a footrace between those who write the virusesand the companies that develop theantidotes. The virus writers are always inthe lead.

Pre-E-mail Viruses

There were two early types of computervirus: ones written to attach themselvesto executable files on a PC or Macintoshand those that infected the boot sectoron a PC. Computers were not normallynetworked as they are now and virusescould be spread only on diskettesexchanged among people or by means ofbulletin boards that people could dialinto using a slow analog modem. Both ofthese types of virus spread slowlybecause the technology of the day wouldnot allow for anything fast.

File-Infecting viruses could only spreador do any damage when a user ran theexecutable file. File-Infecting virusesspread slowly.

Boot sector viruses could only spreadwhen someone turned on or re-booted aPC while an infected diskette was in theboot drive (usually the A:\ drive).

Macro Viruses

Macro viruses were written to takeadvantage of the newer technology ofpowerful macro languages. They weren'twritten specifically to spread rapidly butthe rapid growth of the Internet and of

Jerry Hinek, SBC

businesses of all sizes, especially largercompanies, businesses with multiplelocations or those with complex needs.The standardized national data services(replacing previous regional offerings)add new levels of convenience for SBC'scustomers, providing identical pricingand service features throughout the com-pany's regions and nationwide. Theofferings are available today in all SBCregions. The company's new, standard-ized service offerings deliver greater con-venience and flexibility for customers.

SBC's new standardized Frame Relay,ATM and Private Line services providecustomers with the following benefitsand options:• The same features, terms and pricingacross all of SBC's regions and asingle point of contact for customerswith transport needs rangingthroughout SBC's territories.• New service capabilities, such asalternate routing, disaster recovery andpermanent virtual circuits with qualityof service.• A new bundled offering for locationsoutside of SBC's local service territory,allowing more cost-effective and effi-cient connection to the SBC data net-works.• Enhanced Service Level Agreementsproviding industry-leading performanceand reliability guarantees for customers.• Seemless international Frame Relayand IP services covering 48 countries, aswell as dedicated international PrivateLine service to Mexico. These new serv-ices are available as standalone offeringor as the transport foundation for SBC'sPremierSERV (SM) NetworkManagement offerings.

To find out where these networks andrelated services are available today,please contact your SBC Liaison Manager(1-800-552-5299).

continued from page 1SBC NATIONAL DATA TRANSPORTPORTFOLIO ENHANCED

continued on page 43

product, SBC Yahoo! DSL Symmetric384 - S Package, which is a Static IPoffering for customers up to 12.5 K ft.Yahoo! It will be comfortably pricedbetween the Deluxe - S Package and theExpert Plus - S Package. This will be aviable solution for your customers whoneed the increased upstream but at alower cost for video conferencing, filetransferring, and other business sensi-tive applications.

We’re No. #1…Since the leading three Internet ServiceProviders all launched new versions oftheir services in 2002, comparisons wereplastered all over the media. ForresterResearch was one of the first technologyanalyzers to report out. What did theyreport? On a scale of 1 to 5, SBC Yahoo!came in at 4.3, compared to 3.8 for onecompetitor and 2.9 for another.Forrester’s report cited SBC Yahoo! DSLand Dial as leading Internet serviceswith strong current offerings and go tomarket strategy.

Rack Rates for SBC Yahoo! DSL InternetService:

The availability of the new speeds iscontingent upon the distance the customer’s premise is from the CentralOffice (loop length). If the SBC Yahoo!DSL service is served by a RemoteTerminal (RT), the loop length limitation does not apply. The guaranteed speed is the minimum speedin the speed range selected. Actualthroughput speeds will vary due toInternet congestion and other factorsassociated with the Network or the customers’ computer.

Product Name Speed (downstream xupstream) Loop Length Rack Rate: SBCYahoo! DSL Basic Package up to384Kbps x 128Kbps 16K ft $42.95/moSBC Yahoo! DSL Standard PlusPackage 384Kbps - 1.5Mbps x 128Kbps12K ft $49.95/mo SBC Yahoo! DSLStandard Plus – S Package 384Kbps –1.5Mbps x 128Kbps 12K ft $64.95/moSBC Yahoo! DSL Deluxe Package768Kbps – 1.5Mbps x 256Kbps 9K ft$59.95/mo SBC Yahoo! DSL Deluxe –S Package 768Kbps – 1.5Mbps x256Kbps 9K ft $79.95/mo SBC Yahoo!DSL Expert Plus – S Package 1.5Mbps –6Mbps x 384Kbps 7.5K ft $159.95/mo

More PromotionsOur incredible promotional rates willcontinue this year, affording your customers a generous opportunity toexperience SBC Yahoo! DSL at discounted prices. Customers can enjoydiscounts on CPE, monthly rates as lowas $39.95/month and waivers of processing fees. Bundled customers canenjoy even steeper discounts. Mail dropsare coming your way soon. Listen forradio ads announcing an offer inyour neighborhood!

Poised For Take Off

SBC continues to demonstrate industry

UPD

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E-mail usage turned macro viruses into avery large and worldwide problem.People merely had to open a documentor spreadsheet sent by someone knownand trusted and they were infected.

MicrosoftU wanted to make its softwarevery useful to people and to businesses,so it developed robust macro languagesfor its products. MS WordU documentscould have hidden code that might fetchthe current date or edit a form as aperson filled it in.

Business recognized the benefit of E-mail; E-mail became more powerful. Nolonger was E-mail only for sending plaintext messages, people could attach otherfiles, including MS WordU documents,to their message.

The first MS WordU macro virus wascalled the "Concept" virus. It spread farfaster than any previous virus and it tookthe Anti-virus vendors several months todevelop the tools to detect and clean theConcept virus. In fact Microsoft, whichhad never been in the anti-virus business, had to publish the first curefor the Concept virus. The cure was anMS WordU macro. FortunatelyMicrosoftU gave it away for free.

continued from page 3THE PERILS OF EMAIL

E-mail Viruses

The development of powerful macro lan-guages did not stop with word processingand spreadsheets; they are used in E-mailsoftware as well. E-mail programs havebecome more useful, allowing messagesto have graphics, hyperlinks to webpages and embedded code to do usefulthings. The Melissa virus took advantageof the power of E-mail by sending itselfto people in your E-mail address books.The virus hopped from computer tocomputer as people opened whatappeared to be an ordinary E-mail from aknown sender. It took the Melissa virusless than a day to spread around theworld to millions of computers. Welearned that day to be suspicious ofE-mail, even from people weknow and trust.

Fighting Computer Viruses

Combating computer viruses requires acombination of technology andawareness. If you control your own E-mail servers you should deploy anti-virussoftware on the server to scan allincoming E-mail attachments for virusinfected attachments and for hostilecode. You should also deploy anti-virussoftware on all user workstations. Youhave to keep this software up to date.Finally you must constantly besuspicious of E-mail that looks odd. Tellyour staffs to check with the sender or just delete suspicious E-mail.

Hoaxes

Hoaxes are insidious, Social Engineeringmessages that can cause real harm topeople, systems and institutions. Theycause harm not because they are exe-cutable code but because they ask lots ofpeople to do things that wind up causingthe damage. There are several categoriesof E-mail hoax that make differentclaims and cause different kindsof problems.

Virus Alerts

It's bad enough that some technicallysavvy people use E-mail to spreadcomputer viruses, but other people seeE-mail as an opportunity to make up fictitious computer virus alerts that create a completely different set of problems. Some people describe thesevirus alert hoaxes as Social Engineeringviruses. A message arrives in your E-mailwith a subject line and text that imply alot of urgency. A typical virus hoax statesthat some company announced a newand evil virus "yesterday" that the anti-virus software can't detect. The hoaxthen asks you to warn everyone youknow by E-mail so that the virus won'thurt you or the people whom you warn.

Some recent viruses also instruct theuser to delete certain files on your computer that the message claims arepart of the virus. The files that the userdeletes are actual MS WindowsU files.They should not be deleted.

Charitable Chain Letters

Some hoaxes go out in E-mail with messages that say that for every E-mailgoing to a particular E-mail account acertain amount of money will be contributed to the care of some individual dying of cancer. Usually theperson named does not exist and no onewill actually donate money to anyone oranything as a result of sending the message.But people can be so nice that they comply and the owner of the E-mailaccount can no longer use it. Sometimesentire E-mail systems have had to bescrapped because of a charitable chainletter hoax like this one.

Public Health Hoaxes

Public health hoaxes warn people thatcertain bad things have happened toinnocent victims; they ask you to spreadthe word as widely as possible to preventother victims. Usually they attribute thewarning to a government or public healthagency. There will often be the name of alegitimate person at the victim agency.People don't stop and think that legiti-mate agencies would use the mass mediato alert people. E-mail is fast, but it can'thold a candle to radio and TV.

Cash Payment Hoaxes

One recent hoax claimed that MicrosoftUwas testing a new E-mail tracking systemand that it would pay people to send onthe message to others. The author4

Special SBC WebsiteAvailable To You

Latest Pricing, Promotions, ProductNews, Publications, Telecom

Calendars, Resource Library & Weblite Links Plus Lots More

CV Web Connect is Available 24 by 7with password

Call your Liaison Manager To Get A Password

1-800-552-5299

Janu

ary

2003

claimed to have gotten thousands ofdollars already despite having felt doubt-ful to begin with. The message was play-ing upon your own feelings that themessage was dubious so that you wouldbuy into sending it around. Reallygreedy people sent the hoax to thousandsof people all at once. This causedenormous strain on E-mail servers.

Financial Fraud

Several years ago, the CBS TV Show 60Minutes did a story on a type of fraudthat comes from Nigeria. The perpetra-tors send letters to people promisingmillions of dollars in reward if therecipient could help the sender ingetting money out of Nigeria. This wasall an elaborate ruse to get the recipienteither to send money to the sender or tosend personal bank and financial infor-mation to the sender. People who fall forthe scam wind up poorer. This scam nowspreads in E-mail. There are many varia-tions of the text, but the message is fair-ly similar: "This is all legitimate and youwill get rich." Don't trust it.

The Problems with Hoaxes

We all know that hoaxes are bad. Somehoaxes are against the law. You can bearrested and prosecuted for calling in aphony bomb threat. A real bomb threatis also a crime, but not a hoax. Whatmakes E-mail hoaxes special is that theyspread very quickly and cause problemsby their volume. The primary problemswith E-mail hoaxes are:• Denial of service• Loss of productivity• Loss of credibility for legitimate sources of emergency information• Loss of your own credibility• Financial harm

Denial of Service

Hoaxes that spread to hundreds orthousands of readers may ask recipientsto contact a certain phone number orE-mail account. That is normally sufficient to overwhelm systems or personnel not prepared to handle somany messages. Universities, policedepartments, hospitals and businesseshave been harmed by hoaxes. And peopletrying to reach the organization withlegitimate business are harmed by notbeing able to get through.

Loss of Productivity

When hoaxes spread through organizationspeople are distracted from their realwork and motivated to pass along thehoax to others further disrupting theirdays. In a large business a hoax can besent to thousands of people in a fewhours. Once they are out of the bag,hoaxes usually have to just die out ontheir own. Sending thousands of E-mailsto an entire company to tell everyonethat there is a hoax creates its own problems. In the meantime, several thousand people have each lost a fewminutes of productivity.

Loss of Credibility

When computer viruses spread, anti-virus companies and legitimate computersecurity organizations analyze the threatand react professionally. Many computervirus hoaxes claim that the anti-viruscompanies can not combat the fictitiousthreat. People feel that their own securitysupport people are not on the job andkeeping them safe from threats. Andwhen these legitimate organizations dosend out messages to people, the messagesreceive less attention than they should.This same is true for the public healthagencies and police department who arealso harmed by some hoaxes.

Hoax Characteristics

Hoaxes have different content depend-ing on who or what the author wants toharm. The one thing most hoaxes have incommon is that they try to get you to dosomething. The most commoncharacteristic is that hoaxes ask you tosend copies of the message to everyoneyou know or everyone in your E-mailaddress book as quickly as possible tospread the word. Any message that asksyou to do this should be suspect, even ifit comes from your mother. The peoplewho send the hoax to you are just asfooled as the people who sent the hoaxto them.

Hoaxes use your emotions rather thanappeal to your reason. Most hoaxes tryto scare you to do something before abad thing happens. Others appeal todifferent emotions including greed andhuman kindness. They will usuallyattribute the message to some reputableperson or business. Sometimes they justtry to affect a trustworthy tone. All ofthem ask you to spread the word.

Combating Hoaxes

The three most important things incombating hoaxes are Awareness,Awareness and Awareness. You have tostay informed, stay alert and informother people. The more people who cansend back a message to their wellmeaning friend and tell them that themessage is a hoax, the fewer hoaxes wewill all see.

Hoaxbusters

The US Department of Energy main-tains a great list of known E-mail hoaxesbroken down into several categories. It'sa great place to check first whether thatmessage you got is real or not.http://hoaxbusters.ciac.org/HBHoaxIndex.html.

SPAM

We all see the SPAM every day in ourInboxes. From business propositions toInternet drugs to invites to visit pornwebsites. We've all gotten a lot of humorbecause anyone who laughs at a joke onthe web wants to pass it along. After awhile we don't accept mail from some

friends. People hate all the unwantedmail and are pressuring the governmentto help stop it. It's virtually impossibleto stop someone who is determined tosend you E-mail. No E-mail filter canhelp you get rid of all SPAM unless youjust delete everything. Filter what youcan, delete the rest.

What's Coming Next?

Cell phones and PDA's can acceptE-mail. It won't be long before peopleexploit these devices, perhapsscrambling your appointments or ringingwhen no one is calling. Perhaps callingsomeone else randomly while yourphone is on the dresser at night. Newtechnology is great for all theconvenience it brings us. The benefitsoutweigh these problems, but tominimize the problems you have to keepyourself informed. Don't be aneasy target.

Jerry is a Senior Business Security Managerfor SBC Services. He earned an MBA inInformation Management & is a CertifiedInformation Systems Security Professional.

5

It's Bad Enoughthat some technically

savvy people use

E-mail to spread computer viruses,

but other people see

E-mail as an opportunity to make up

fictitious computer virus alerts that

create a completely

different set of problems.

No E-mail Filtercan help you get rid of all SPAM unless

you just delete everything.

Filter what you can,delete the rest.

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unique demands of the access network.Because EPONs are simpler, more effi-cient, and less expensive than alternativeaccess solutions, EPONs finally make it

cost-effective for service providers toextend fiber into the last mile. Thisallows them to reap all the rewards of avery efficient, highly scalable, low-main-tenance, end-to-end fiber-optic network.

The key advantage of an EPON is that itallows carriers to eliminate complex andexpensive asynchronous transfer mode(ATM) and SONET network elementsand to dramatically simplify theirnetworks. Traditional telecom networksuse a complex, multi-layered hierarchicalarchitecture which overlays IP ontoATM, SONET, and WDM. Thisarchitecture requires a router network tocarry IP traffic, ATM switches to createvirtual circuits, add/drop multiplexers(ADM) and digital cross-connects (DCS)to manage SONET rings, and point-to-point DWDM optical links.

There are a number of limitationsinherent to this legacy architecture: • It is intensely difficult to provision

because each network element (NE) inan ATM path must be provisioned foreach different service

• It’s optimized for time division multi-plex (TDM) voice—not data—so itsfixed bandwidth channels are ultimate-ly inefficient and have difficulty han-dling bursty data traffic

• Legacy TDM-based architecturesrequire inefficient and expensive opti-cal-to-electrical-to-optical (O–E–O)conversion at each network node

• They also require installation of allnodes up front (because each node is aregenerator), and older architecturesdo not scale well because of their con-nection-oriented virtual circuits.

In the example of a streamlined EPONarchitecture in Figure 2, an optical net-work unit (ONU) replaces the SONETADM and the router at the customerpremise, and an optical line terminal

voice services aren’t widely implementedover these technologies. The result is agrowing gulf between the capacity ofmetro networks on one side and end-user

needs on the other side, with the last-mile bottleneck in between. PONs aimto break the last-mile bandwidth bottle-neck by targeting the “sweet spot” ofbandwidth between T1s and OC–3s thatother access network technologies do notadequately address. This bandwidth areaalso includes a sweet spot that willprovide a variety of cost-effective speedsand feeds that don’t exist today.

EPONS Versus APONs

The key difference between EPONs andAPONs is that in EPONs, data is trans-mitted in variable-length packets of upto 1,518 bytes (maximum) according tothe IEEE 802.3 standard for Ethernet.Conversely, in APONs data is trans-mitted in fixed-length 53-byte cells (with48-byte payload and five-byte overhead),as specified by the ATM protocol. Thisformat means it’s difficult andinefficient for APONs to carry trafficformatted according to the InternetProtocol (IP). IP calls for data to be seg-mented into variable-length packets ofup to 65,535 bytes maximum. For anAPON to carry IP traffic, the packetsmust be broken into 48-byte segmentswith a 5-byte header attached to eachone. This process is time consuming andcomplicated. It adds protocol overheadin the form of the notorious ATM “celltax”, which adds additional cost to theOLT and ONUs. When using ATM inany architecture, 5 bytes of bandwidthare wasted for every 48-byte segment,creating an onerous overhead. By con-trast, Ethernet happens to be tailor-madefor carrying IP traffic and dramaticallyreduces overhead compared to ATM.

EPON Fundamentals And BenefitsUnlike point-to-point fiber-optic tech-nology which is optimized for metro andlong-haul applications, EPONs arespecifically designed to address the

EthernetPassive OpticalNetworks(EPON) - TheSimple PON

Ethernet passive optical networks(EPON) are an emerging access networktechnology that provide a low-costmethod of deploying optical access linesbetween a carrier’s central office (CO)and a customer site. EPONs build onthe International TelecommunicationsUnion (ITU) standard G.983 forasynchronous transfer mode PONs(APON) and seek to achieve the dreamof a full-services access network(“FSAN”) that delivers converged data,video, and voice over a single opticalaccess system.

PON can support transmission up to 12miles, depending on the number of cus-tomers on the network and the capabili-ties of the laser signal regeneration,which is why it's only targeted for shortmetro links. Carriers are just beginningto deploy PON, with players likeQuantum Bridge, Paceon, and OpticalSolutions offering systems today.

Evolution of Passive Optical Networks

Passive optical networks (PONs) addressthe last mile of the communicationsinfrastructure between the serviceprovider’s CO, head end, point of pres-ence (POP); and business or residentialcustomer locations. Usually , only largeenterprises can afford to pay the $3,200– $4,300 per month it costs to lease aDS-3 circuit (45 Mbps) or optical carrier(OC–n) SONET connection. T1s thatcost $375 per month (average) are anoption for some medium-size businesses,but most small and medium-size enter-prises and residential customers are leftwith few options beyond plain old tele-phone service (POTS) and dial-upInternet access at 56Kbps. Where avail-able, digital subscriber line (DSL) andcable modems offer a more affordableinterim solution, but these services aredifficult and time-consuming toprovision. DSL availability is alsoconstrained based on whether or not therequired electronics are in servingcentral offices.

In EPON systems, bandwidth is limitedby distance and by the quality of existingwiring (similar to xDSL services); and

Paul Bedell, SBC

BANDWIDTH(bps)

SERVICES

64K 144K 1.5M 45M

Ethernet10BaseT

POTS ISDN DSL

SWEET SPOT OFOPERATION

Fast Ethernet100BaseT

T-1 T-3 OC-3

1G

GigabitEthernet

10 G

OC-192

155M

RANGE OF OPERATION FOR PASSIVE OPTICAL NETWORKS

"See an individual in every customer."

6

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Figure 1: Ideal Frequency Range for Passive Optical Networks

data, video, and voice over a singleplatform. While EPONs offer higherbandwidth, lower costs, and broaderservice capabilities than APON, thearchitecture is broadly similar andadheres to many G.983 recommenda-tions.

In November 2000, a group of Ethernetequipment vendors kicked off their ownstandardization effort under the auspicesof the Institute of Electrical andElectronics Engineers (IEEE), via theformation of the Ethernet in the FirstMile (EFM) study group. Sixty-ninecompanies have indicated they’ll partici-pate in the group, including 3Com,Cisco Networks, Alloptic and WorldWide Packets.

Passive Optical Network Architecture

The passive elements of an EPON arelocated in the optical distribution net-work (also known as the outside plant).They include single-mode fiber-opticcable, passive optical splitters/couplers,connectors, and splices. Active networkelements (NEs), such as the OLT andmultiple ONUs, are located at the endpoints of the PON. Optical signals trav-eling across the PON are either splitonto multiple fibers or combined onto asingle fiber by optical splitters/couplers,depending on whether the light is travel-ing up or down the PON.

********************************

KEY: The PON is typically deployed ina single-fiber, point-to-multipoint, tree-and-branch configuration for residentialapplications.

********************************

(OLT) replaces the SONET ADM andthe ATM switch at the CO. Figure 2below illustrates how EPON streamlinesservice provider architectures when com-pared to legacy designs and operations.

To summarize, an EPON architectureoffers carriers a number of benefits.First, it lowers up front capital equip-ment and ongoing operational costs rela-tive to SONET and ATM costs.Second, an EPON is easier to deploythan SONET/ATM because it usessimpler hardware and no outside plantelectronics, which reduces the need forexperienced technicians. Third, itenables flexible provisioning and rapidservice reconfiguration. Fourth, itoffers multi-layered security, such asvirtual LAN (VLAN) closed user groupsand support for virtual private networks(VPNs), IP security (IPSec), andtunneling. Finally, carriers can increaserevenues by exploiting the broad rangeand flexibility of service offeringsavailable over an EPON architecture.Profit margins will be higher due tolower infrastructure costs. This includesdelivering bandwidth inscalable increments from 1 Mbps to1 Gbps and value-added services such asmanaged firewalls, voice traffic support,VPNs, and Internet access.

The development of EPONs has beenspearheaded by several visionary start-upcompanies that feel the APON (ATM-based PON) standard is an inappropriatesolution for the local loop because of itslack of video capabilities, its insufficientbandwidth, its complexity, and its higherexpense. And as the migration to FastEthernet, gigabit Ethernet, and now 10

gigabit Ethernet gathers steam, thesestart-ups believe that EPONs will elimi-nate the need for conversion in the wide-area network LAN / WAN connectionbetween IP and ATM protocols.

EPON vendors are focusing initially ondeveloping fiber-to-the-business (FTTB)and fiber-to-the-curb (FTTC) solutions,with the long-term objective being therealization of a full-service fiber-to-the-home (FTTH) solution for delivering

Central Office

TDM/PSTNNetwork

ATMNetwork

PNetwork

Video/AudioNetwork

OtherNetwork

FEEDERFIBER

DISTRIBUTIONFIBER

1X4Coupler

1 ST COUPLER

PON

ONU ONU

ONU

ONU

ONU

ONU

PON

VOICE AND DATA

VOICE AND DATA

SOHOServices,

Voice, ISDN,Specials, etc.

VOICE AND DATA

VOICE AND DATA

Small BusinessServices

DS-1, Data,ATM UNI,

ManagementSystem

OLTSYSTEM

EMS

continued on page 8

ONU

WAN

WAN

ROUTER ROUTER

PC

LAN

SERVER

PC

LAN

SERVER

CO CHASSIS

CENTRAL OFFICE CPE

CENTRAL OFFICE FIGURE 2 CPE

ATMSWITCH

SONETADM

SONETADM

ROUTER

Figure 3

Figure 2

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Source: www.iec.org

Source: www.iec.org

Figure 2: How EPON Simplifies Carrier Network Architectures: “Before” (top) and “After” (bottom)

Figure 3: Passive and Active Network Elements of a PON

7

The PON may also be deployed in a pro-tected ring architecture for businessapplications, or in a bus architecture forcampus environments and multiple-ten-ant units (MTU).

See Figure 3 for an illustration of aPON architecture.

Economic Justification For EthernetPONs

The economic case for EPONs is simple:fiber is the most effective medium forsimultaneously transporting data, video,and voice traffic, and it offers virtuallyunlimited bandwidth. But the cost ofrunning fiber point-to-point from everycustomer location all the way to the CO,installing active electronics at both endsof each fiber, and managing all of thefiber connections at the CO is obviouslyprohibitive.

********************************

KEY: EPONs address the shortcomingsof point-to-point fiber solutions by usinga point-to-multipoint architecture in theoutside plant portion of the networkinstead, by eliminating costly active elec-tronic components such as regenerators,amplifiers, and lasers, from the outsideplant. Active components will alwayscost much more than passive compo-nents. In the PON scenario, the passivecomponent is a type of optical splitter, aprism of sorts. This prism re-directsoptical signals (lambdas) down differentroutes in the “last miles”.

********************************

8

continued from page 7EPON THE SIMPLE

Cost-Reduction Opportunities

EPONs offer service providers unparal-leled opportunities to reduce the cost ofinstalling, managing, and deliveringexisting service offerings. For example,EPONs can :

· Replace active electronic componentswith less expensive passive opticalcouplers that are simpler, easier to main-tain, and longer lived

· Conserve fiber and port space in the CO Share the cost of expensive activeelectronic components and lasers over

many more subscribers

· Deliver more services per fiber andthereby slash the cost per megabit

·Enable long-term cost-reduction oppor-tunities based on the high volume andsteep price/performance curve of Ethernetcomponents

· Save the cost of truck rolls becausebandwidth allocation can be doneremotely. It’s estimated that each truckroll costs service providers around $750

· Use standard Ethernet interfaces whicheliminates the need for additional DSLor cable modems

· Prevent the need for electronics inoutside plant, which reduces the needfor costly powering and right-of-wayspace

· Free network planners from trying toforecast the customer’s future band-width requirement because the systemcan scale up very easily

continued on page 18

Grid Computing:An Example ofthe Confluenceof Telecom andComputing

What is grid computing? And why dowe, in telecommunications, care? We’llanswer the first question in this article.We care about grid computing because itis one of the things that are going tohelp restore strength in the telecommu-nications industry.

Background

There has been a lot of discussion in thelast couple of years about bandwidthgluts. We have heard that the dismal con-dition of the telecom market is partiallya consequence of excessive deploymentof fiber optic capacity. There is sometruth to this but the problem is more oneof timing than of any real excess incapacity. Networks have been built inanticipation of demand that hasn’tmaterialized—yet.

In a now-famous speech several yearsago, Bob Metcalfe (co-inventor ofEthernet and founder of 3Com) madethe prediction that the volume of trafficin private networks (he was specificallytalking about LANs) was growing atsuch a rate that it would cause the col-lapse of the Internet. Well, as we cannow see, the Internet has scaled nicely toaccommodate the growth of traffic. Thequestion now is: has “the Internet” (i.e.,backbone links and switches) scaled toofar? Do we really have a glut of capacitysomewhere? Anywhere? I’ll dodge thisone for now and say, “maybe”, but even ifso, this is a temporary condition. As isoften the case, so often that it’s becomea hackneyed cliché, what’s really neededto restore the economic balance is akiller application. There is no questionthat all of the capacity currently in placewill get exhausted; there is only thequestion of when. We can’t answer thatwith any precision but we can under-stand what some of the applications arewhich will utilize this capacity and thatwill give us some insight into the future.

Mark Fei

Sometimes InterestingTechnology

ideas float around for a while

before they get

enough traction to be widely noticed.

Point-to-Point FiberAccess

EPON

Point-to-Point Architecture Point-to-Multipoint ArchitectureActive electronic componentsare required at the end of eachfiber and in the outside plant.

Eliminates active electronic components suchas regenerators and amplifiers from theoutside plant, and replaces them with less-expensive passive optical couplers that havesimpler designs, are easier to maintain, andhave longer lives than active components

Each subscriber requires aseparate fiber port in the CO.

Conserve fiber and port space in the CO bypassively coupling traffic from up to 64 opticalnetwork units (ONU) onto a single fiber thatruns from a neighborhood demarcation point(splice box or manhole) back to the serviceproviderês CO, head end, or POP

Expensive active electroniccomponents are dedicated toeach subscriber

The cost of expensive active electroniccomponents and lasers in the optical lineterminal (OLT) is shared over manysubscribers

Table 1: Comparison of Point-to-Point Fiber Access and EPONs

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Table 1: Comparison of Point-to-Point Fiber Access vs. EPON

We’re going to look at one such applica-tion for the remainder of this article.

A Little Push

Sometimes interesting technology ideasfloat around for a while before they getenough traction to be widely noticed.There are many things that can help spurthis traction, but one would be boldstatements about $10 billion dollarinvestments by IBM. That’s exactly whathappened at the end of October whenSam Palmisano, IBM’s new CEO,announced their commitment to the “ondemand” future which has gridcomputing as a principal enabler.

A Very Brief History of Computing

Business computing is a little more than40 years old. A timeline of computingcould be broken down into threeoverlapping phases, with their start timesroughly as shown:

Stand-alone (began in 1960s)Distributed, aka Client/Server (began in1980s)Networked (began in 1990s)

Each new phase does not replace, butrather adds to, the methods of earlierphases.

In the stand-alone era, computersworked autonomously—they were fedprograms and data and they returnedresults. In the distributed, orclient/server era, computers areconnected together so that computa-tional workloads can be shared to acertain degree. However, such sharingwas rigidly and narrowly defined. Anexample would be mainframe computers(servers) performing complex databaseoperations while desktop PCs (clients)handle functions like user interface,information display, etc. The third era,in which we find ourselves today, islargely driven by the Internet and theopen protocols that have evolved with it.Users are able to access a great variety ofinformation resident on vast numbers ofcomputers located, potentially, anywhereon Earth. The client/server model is alsoa crucial element in this era, i.e., yourPC is the client and you are requestinginformation from servers located else-where. An important thing to note hereis that while information is widely dis-tributed and accessible from nearly any-where, actual computational horsepoweris still very statically located.

Let’s look at an example to betterunderstand what this means. Imagine ascenario in which you run standardproductivity applications on your PC(e.g., word processing, spreadsheet,email, browser, etc.) Hopefully, your PCis equipped with sufficient processingpower, memory, and other resources torun those applications satisfactorily.Now let’s further imagine that you havea new requirement to run a video editingapplication on your PC, but you’re onlygoing to need to do this kind of workoccasionally. What you quickly discover

is that your PC is woefully inadequate tothis new chore and you wind upspending countless hours waiting fortasks to be completed. In order for thisvideo editing to be accomplished in areasonable amount of time you needmore computer horsepower than youcurrently have sitting on your desk. But,if you were to go buy that horsepower, itwould sit, unused, for most of the time.What would be ideal would be the abilityto somehow grab (borrow, buy or rent)computational horsepower across a net-work from other computers, availablewhen you need it.

Enter Grid Computing

Grid computing is the solution to theproblem just described. Grid computingis sometimes described as making com-puting power available the way that elec-tric power is—just plug in and use (andpresumably pay for) what you need,when you need it. This is not a radicallynew idea but rather a very reasonable

next step in the evolution of computing.We move from the notion of clients andservers to one of peer-to-peer computing,but we extend this model in dramaticand, more importantly, dynamic newways by allowing applications toautomatically find not only distributedsources of information, but distributedsources of raw computational power.

Accomplishing what I’ve just describedis not trivial technically, and will requiresignificant work in the areas of openstandard protocols and methods. Thereis a tremendous amount of work that hasalready been done and there are excitingtrials already underway which provideproof of concept. Let’s take a few moreminutes to explore what the implicationsare in our bailiwick—the network.

Impact on the Network

For most of the 40+ years of computerhistory computers have been capable ofmanipulating and moving data internallyfar faster than the data could be movedbetween computers. Simply put, com-puters were very fast but networks were

slow. Furthermore, any networks thatwere fast enough to keep up with thecomputers (high speed LANs, datacenter technologies like ESCON,FICON, Fibre Channel, etc.) all hadserious distance limitations so theirapplication was limited to use within abuilding or campus. Advances in net-work technology in the last few yearshave produced an interesting leap-frogeffect. We now find that networks canbe faster than the computers. In essence,the computers, not the network, aresometimes the bottleneck in informationprocessing.

This improvement in networkingcapability is what makes grid computingpossible and economically viable. Ifsufficient throughput can be obtainedeconomically, then distributedcomputing nodes can be tied together toshare their horsepower. However, inorder for this to function on asignificant scale, the throughput neededwill be measured in gigabits per second,at a minimum. In other words, there hasto be enough bandwidth, with lowenough latency, that the computers don’twaste time waiting for data.

Conclusion

There are a few people left in the world(and I’m one of them) who are still veryoptimistic about the future of telecom-munications. This bright future willmaterialize because there will be applications that consume huge amountsof bandwidth, but that bandwidth has tobe available very inexpensively. The solu-tion to the current economic woes facingmany carriers is not to attempt to recapturehigher prices for services, but to helpenable massive consumption of services,which can only happen if the servicesbecome cheap.

For a look at grid computing today andan interesting example that you canparticipate in from your own PC, seehttp://www.fightaidsathome.org. Thisparticular example does not consumevast amounts of bandwidth because mostof the participants don’t yet have thebandwidth available, but it doesillustrate the grid computing model.

Mark, founder of Fei Communications Group, LLC, has been training CEOs andother leaders in the Telecom World for nearly20 years. He can be reached at www.fei-comm-group.com.

Opinions expressed are not necessarily those ofSBC.

9

"A Kind Word Is Like A Spring Day."

Russian Proverb

For Most ofthe 40 Years

of computer history, computers

have been capable of manipulating and moving data

internally far faster than thedata could be moved between

computers.

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Healthcare Enterprise Network

1 2

3 4

1= patient scheduling system; 2=billing system3=digital medical imaging ; 4= operating room

Figure 1

Telecommunication

Computer Robotics

Emerging Health Oriented Technologies

Figure 2

Integrated Health Services Network

High SpeedNetwork

HealthcareEnterpriseNetwork

HealthcareEnterpriseNetwork

HomeHealthcareConsumers

HomeHealthcareConsumers

Figure 3

Health-OrientedTechnologies(HOT)

The 20th century wasabout electronics andmicro-miniaturization,

making things smaller, faster andcheaper. The 21st century will be thecentury of quality of life and health,application of technologies to improvehealth. Here we explore the followingtwo areas where new health orientedtechnologies (HOT) will continue to pro-vide better quality of health for themasses. These include:

• Healthcare Enterprise Technologies• Home Healthcare Technologies

Healthcare Enterprise Technologies

Today’s health delivery centers are fullof telecommunication and computertechnologies. A representative exampleof a wired healthcare enterprise is shown

in Figure 1. Various departments in amedical center are all interconnected viaa high speed Intranet.

Technologies prevalent in various healthdelivery sites include:

• Video and audio conferencing forconsultation and remote diagnostics• Object oriented technologies forbilling and appointment scheduling• Digital Imaging systems for x-rays• Internet access for medical researchand training• Highly sophisticated OperatingRooms (ORs) for surgical procedures

Surgery is a very respectable branch ofthe medical system and this continues todeploy newer technologies to improvethe quality of healthcare. Laparoscopic

surgery is a recent development inthe evolution of operating room

Jagdish Kohli, Ph.D.

10

technology. This system deploystelecommunications, computers and robotics technologies as shown in Figure 2.

Laparoscopic surgery uses miniaturescopes and instruments that are insertedthrough tiny incisions in the abdomen.The surgeons don’t see the area, but viewthe procedure on a monitor that receivesimages from a small camera or scopeinserted into the body. Laparoscopicsurgery is used for a number of situa-tions. It’s a minimally invasive gallbladder surgery. A comparison of newertechnology based surgery with the tradi-tional method follows:

This procedure had previously requireda large incision, a week’s hospital stayand eight weeks of recovery. Today, Laparoscopic surgery producesalmost invisible scars. The hospital stayhas been reduced to overnight, with areturn to daily activities in about a week. Thus this newer medical enterprise tech-nology has resulted in economic benefitsalong with improving the quality of lifefor the patients.

OR-1—The Future in SurgicalTechnology:

ValleyCare Medical Center inPleasanton, California has the operatingroom of the future. In 2000, ValleyCareopened the first PC-based, fully inte-grated operating room in the United

States. “OR-1” is equipped with roboticassistance, ergonomic features to makelonger surgeries less fatiguing and touchscreen computers that enable surgeonsand nurses to control virtually everyaspect of the operating room. The use ofrobotic arm gives surgeons the use ofboth hands (instead of holding thecamera with one), and provides a moresteady and consistent view. Since therobot is programmed to each surgeon’svoice, making minute adjustments to thecamera position is simple, efficient andless fatiguing. This level of technologypermits the surgical team to tackle morecomplicated cases and providesValleyCare physicians almost unlimitedaccess to information and communica-tion during a surgical procedure.

Source: ValleyCare Health System

Home Healthcare Technologies

A number of health related technologiesare used by many people in the comfortof their own homes. These include:

· Blood pressure (BP) meters forchecking BP as and when needed

· Digital thermometers for checkingbody’s temperature

· Digital weighing scales for monitoringbody’s weight

· Digital meters for measuring bloodsugar levels specially for patients withdiabetes

· Medical alert systems for patients’ withserious medical problems and needingurgent help at a short notice

The Future

An integrated view of an evolvinghealthcare network is shown in Figure 3.Home healthcare users including elderlymembers and young and adult familieswould always be connected with the

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healthcare enterprises.

Health oriented technologies are verypromising with a number of system-widebenefits including:

· A convenient and non-threatening environment within the home to managehealth· Periodic consultations with the primaryhealthcare provider via audio or videoconferencing · Periodic health check monitoring byusing simple-to-use health oriented technologies· Monitoring resulting in an early detection of any malfunctioning withinthe body and thus recovery at muchlower costs · Overall improvement in the delivery ofquality healthcare

In order to fully benefit from newerhealth oriented technologies, variousmembers of the society must be exposedto the power of these technologies. Thebest and cheapest way to care for peopleis to help them not get sick. A height-ened level of self-awareness is extremelyimportant to recognize and take chargeof one’s own state of health.

Health-Oriented Technologies will helpalleviate human suffering by preventingthe onslaught of disease. Most of us willagree that a planned dose of preventionis much better than a painful cure.

Jagdish has worked on a number of infor-mation technology projects during thepast 20 years. His work in medical com-munications is widely known. He can bereached at jagdish_kohli@yahoo.com

SBC R&D to develop newlayers of Internet security

SBC Communications has announced theformation of an Internet security test beddesigned to uncover new and innovative waysto expand the scope and effectiveness ofcyber-security technology.

The project, known as the Internet Assuranceand Security Center (IASC), will be designedand managed by SBC Technology ResourcesInc., SBC’s research and development centerbased in Austin. TX

SBC is launching the IASC in response to therising tide of Internet security violations, suchas viruses, worms and denial-of-serviceattacks. The Computer Emergency ResponseTeam, Coordination Center, an organizationthat documents security vulnerabilities, saysInternet security violations more than doubleeach year. According to cyber-security experts,the recent Bugbear virus is the most severewidespread attack to occur in 2002. Less thanone week after it first appeared, the virus hadgrown exponentially, affecting millions ofusers around the world.

Howard Schmidt, Vice Chairman ofPresident Bush’s Critical InfrastructureProtection Board, met with SBC offi-cials last month to review plans for theIASC and other security efforts beingimplemented by the company. “SBC isshowing just the sort of initiative that isneeded in the private sector to helpadvance cyberspace security,” Schmidtsaid.

The IASC will focus on development ofsecurity technologies and standards thatcan be applied throughout large telecom-munications networks, such as SBC’s,that handle Internet, voice and data traf-fic for millions of individual users andbusinesses. While the majority of cur-rent security efforts, such as firewalls,place the primary burden of security onend users, IASC research will support aholistic approach that encompasses allelements of the network: telecommuni-cations providers, enterprise networks,customer networks, and hardware andsoftware vendors.

“Internet and network security viola-tions are at an all-time high, and theproblem demands our immediate atten-tion,” said Fred Chang, president andCEO, SBC Technology Resources. “SBCrecognizes this threat, and we also under-stand that addressing it will take a coop-erative, collaborative effort among thepublic and private sectors, including net-work providers and equipment vendors.We have chartered the IASC to helpfacilitate this effort and begin theprocess of enhancing overall security forthe Internet, carrier and corporate net-works.”

continued on page 12

Sterling CommerceLaunches Global PartnerProgramSterling Commerce has introduced theSterling Commerce Global PartnerProgram, a comprehensive initiative thatstreamlines sales processes, informationflow and resources between the companyand its channel partners. The wide-ranging program provides distributors,resellers, affinity partners and referralpartners access to a variety of sales,marketing and customer support toolsdesigned to address their unique needsand add value to their sales processes.Key elements of the sterling GlobalPartners Program include PartnerNet,Support on Demand and the PartnerAdvisory Council. PartnerNet, a pass-word-protected website, includes currentSterling Commerce product informationand downloadable marketing collateral,training materials and success stories.Contact your Liaison Manager or 1-800873-7945 (code, m29901nr) for furtherdetails.

SBC Technology Resources,Inc. Provides Solutions

For SBC to maintain its leadership posi-tion, it must continually pursue tech-nology research and development. That’sthe driving force behind SBCTechnology Resources, Inc. (TRI), theresearch and development division ofSBC Communications. Founded in 1988,TRI provides technology consulting andexpertise to the SBC Communicationsfamily of companies, exploring new waysto turn leading-edge technologies intoreal-life solutions for businesses andconsumers.

SBC’s business units rely on TRI to provide creative technology solutionsthat are necessary to gain a competitiveadvantage in the marketplace. With labsin two of the country’s leading high-techcenters — Austin, Texas, and Pleasanton,Calif. — TRI collaborates with othertechnology industry leaders and premieruniversities and assists with internal andcustomer field trials.

TRI focuses its research and develop-ment efforts on the following key areas:

Broadband Internet Studying new technologies that supportInternet transport and delivery systemsand widespread data connectivity to helpbusinesses and consumers communicatesmarter and faster.

Network ServicesTransforming telecommunications net-work services to increase user conven-ience, productivity and effectiveness, aswell as researching new convergence net-work architectures and products andservices.

Enterprise Information Technology. Researching new productsand services for network management,operational support systems, customercare, information infrastructure security,and information technology to supportbusinesses as they enter new markets,develop new products and services andimprove operations.

Wireless Systems Developing technology to improve andexpand SBC’s cellular, PCS and otherwireless communications services.

11

“Lead With Integrity.”

Thom Matson

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SELLING SOLUTIONSWinning customers in a competitivemarketplace is always a challenge. This isespecially true in today’s telecommunica-tions market, where customers increas-ingly have the opportunity to choose notonly between multiple providers, butalso between multiple technologies toaddress their needs. This gives cus-tomers considerable flexibility in pur-chasing, and drives service providers tocreate differentiation strategies for theirproducts.

Here’s an example.

The Neptune Printing Co. needs totransmit information between its loca-tions. Up until fairly recently, its choic-es primarily consisted of purchasingTDM-based connectivity from the ILECor not. Then, competitive long-distanceproviders such as MCI and Sprint, andnew technologies like frame relay andATM appeared on the market, butoptions remained fairly limited.

Today’s situation is likely quite dif-ferent. Neptune probably has a widevariety of providers to choose from,

including the big IXCs (AT&T,MCI/Worldcom, and Sprint), its localexchange carrier, such as SBC, and anynumber of competitive providers. Thisis especially true in metropolitan areas.

Equally important is the menu of tech-nologies that are now available to meetthe connectivity needs of NeptunePrinting. The standard list of options isstill there: DS-1, DS-3, frame relay, andSONET or ATM if bandwidth needs arevery high. However, this list is expand-ing in many areas to include other typesof transport, notably Ethernet and IP-based services.

Services above and beyond basicconnectivity are also becoming common-place, as service providers seek to createdifferentiation for their products. Theseservices include things like guaranteedlevels of throughput, various securityoptions, and the ability to monitor theperformance of one’s own network viathe Internet.

Providers are also beginning to offerbundles of services for increasedconvenience and favorable prices. Casein point-- what if Neptune would like tohave most or all of its communicationsneeds met by one company, consolidatedonto one bill, and priced at a discount?

As intimidating as this long list ofoptions may be for Neptune, it’s greatnews for them and for all buyers oftelecommunications services. Theability to pick and choose betweenproviders and between technologiesallows them to balance theirperformance needs and purchase pricemuch more effectively than ever before.

Obviously, this has implications on thesales side of the equation. Since in manycases there is more than one product,and more than one provider, that coulddo the job, a successful salespersonneeds to be able to explain to thecustomer why the benefits of what he orshe is selling, at the price being quoted,provide a better overall value than othercompetitive offers.

Let’s use Neptune Printing as anexample. Assume that what the companyneeds is a way to transport imaging databetween its locations. In order to answereven the basic question of whichtransport technology is appropriate,further analysis of the company’s needsmust be done.

Defining customer needs

Finding out how much traffic needs tobe moved from one place to another isonly the first step in understanding whatsolution would be the best fit forNeptune.

Is the amount of traffic more or lessconstant over time or does it “spike”frequently?

continued on page 13

In addition to the original research to beconducted by TRI, the IASC also willact as a point of collaboration withexisting security research efforts in gov-ernment, academia and industry.Telcordia Technologies is the first com-pany to partner with SBC on the IASCproject. TRI also has a research alliancewith the Center for InfrastructureAssurance and Security (CIAS) at theUniversity of Texas-San Antonio.Additional partners and collaboratorswill be announced in the future. TheIASC will evaluate several methods todetect and neutralize attacks andunwanted content from carrier networks.In addition to investigation of securitytechnologies and systems in general, theIASC will focus on approaches forembedding security components in thenetwork.

Network-based security brings the poten-tial for significant advances:

* Security functions could beshared among multiple subscribers on anetwork, relieving some of the burdensplaced on individual users to take secu-rity precautions, and ensuring that allsubscribers are protected by the latesttechnology. * Attacks and unwanted contentcould be stopped in the carrier network,preventing congestion of subscriberlinks. * Security technology compo-nents in different parts of the networkcould correlate information andcollaborate to thwart attacks.

As an example, security components inseveral parts of SBC’s network could bedesigned to detect unusual flows oftraffic converging on a particularcustomer. Once it is determined that thisbehavior is a distributed denial-of-service attack, the network couldautomatically filter the offending trafficfrom multiple locations. Another area of focus for the IASC willbe the development of new securityspecifications for telecommunicationsequipment providers. Large telecommu-nications networks are built usingproducts from several different vendors.The IASC will work with these vendorsto encourage widespread adoption ofsecurity standards for their components,creating a “designed-in” element ofsecurity that will protect networks fromthe ground up.

The IASC is only one component ofSBC’s efforts to provide comprehensivesecurity offerings for three distinct seg-ments of the communicationsinfrastructure: individual users,enterprise networks and large serviceproviders, such as SBC. Currently, themajority of Internet security productsand services are developed for individualcustomers and business networks; theseproducts include firewall and anti-virussoftware.

The IASC’s focus on carrier securitywill round out SBC’s complementaryInternet security offerings. The com-pany’s DataComm division offersenterprise customers a full networksecurity portfolio to integrate thedesign, delivery and management ofsecurity packages. Residential userswho sign up for the new SBC Yahoo!DSL service will receive security soft-ware at no extra charge. The Internetand data networks in general havebecome a critical infrastructure forbusiness, communicationsand entertainment.

Winning CustomersIn A Competitive Marketplace

is always a challenge.

This is especially true in today’s

telecommunications market,

where customers increasingly have

the opportunity to choose not only

between multiple providers, but also

between multiple technologies to

address their needs.

Rick Tonielli, SBC

12

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SBC & Yahoo!SBC and Yahoo! had an idea: Build anInternet experience specifically forbroadband. It would be somethingtotally new. Your homepages would bepersonalized for you. They would getyou things you like and keep out thethings you don't. They follow yourfavorite football team or help you payyour phone bill. Internet built for broad-band would even look different. Pageswould play streaming videos or connectyou to Internet radio stations.Homepages would update themselvesright before your eyes. Internet built forbroadband would be able to do thingspages programmed for slower speedswouldn't. And it's here. Welcome to SBCYahoo! DSL. It's smarter. It's faster. It'sInternet that logs onto you. See it your-self at sbc.com/sbcyahoo.

A Closer Look

With SBC Yahoo! DSL you get theInternet at warp speed--along withexciting, personalized features and perksthat take advantage of your fast new con-nection. Some of the features include:• Personalized Homepage: Customizeyour homepage and do everything--fromemail, Webcam, instant messenger, cal-endar--without leaving.• Customized SBC Yahoo! DSLBrowser: Enjoy a new browser designedto take full advantage of your fast newconnection.• Email: Set up 10 personalized subaccounts and access your mailbox onlinefrom anywhere.• Messenger: Send instant text andvoice messages and see your friendsbigger and clearer than ever.

Contact your Liaison Managerfor further details.

John Atterbury, Group President-Strategic Processes, has been named SBC GroupPresident-Operations. He assumes Stan Sigman's responsibilities for SBC's WirelineOperations & reports to Ed Whitacre, Chairman and CEO.

Stephen Carter, President & CEO of Cingular Wireless, has been named VicePresident of SBC & reports to Whitacre.

Stan Sigman, SBC Group President & Chief Operating Officer, has been namedPresident & Chief Executive Officer of Cingular Wireless.

Forrest Miller, Group President of Corporate Planning, also will oversee SterlingCommerce.

To more effectively focus on High-Speed Data Services and offer WorldclassCustomer Service for Data and Long Distance Products, SBC is changing thereporting structure for its Data and Long Distance Companies to report to SBCEnterprises, a division of SBC Operations, Inc. As of Dec. 1st, the following organi-zations report to Rich Dietz, President-SBC Enterprises:

· SBC Internet Services companies (SBIS, PBI, AIMS, SNETInternet & Prodigy)· SBC Advanced Solutions companies (ASI & AADS)· SBC DataComm· SBC Long Distance· SBC E-Services· SBC Telecom (on a dotted line basis)

Rich Dietz will report to John Atterbury, Group President-Operations. Amongthose reporting to Dietz will be:

Zeke Robertson, Senior Vice President-SBC Advanced Solutions

Fred Taylor, Vice President-SBC Advanced Solutions

Bob Casali, Vice President-SBC Advanced Solutions

Cliff Agee, Senior Vice President-SBC DataComm

Yno Gonzalez, Vice President-Network Operations-SBC Long Distance

Tim Harden, President of SBC Telecom (on a dotted-line basis). As part of thisreorganization, J. Michael Turner, President of SBC DataComm & SBC InternetServices, has announced his intention to retire (Dec. 30, 2002).

SBC Executive NewsAre the characteristics of the trafficexpected to change over time? Forexample, does the company expect tocarry voice traffic on the network atsome point in the future?Are delays in transmission important, orcan data just be resent if it gets lost? How mission-critical is datatransmission? What sort of networkdowntime is permissible?Does the company need to be able tomonitor the performance of its network?How quickly must the company be ableto add bandwidth? Does Neptune wantthe capability to do so itself, withouthaving to rely on the service provider?What level of security is needed? Doesit matter if Neptune’s data is mixed withdata from other sources during trans-port, as long as it gets there?What kinds of access are needed to thetransport network?What types of legacy equipment are inplace? Must they work with any newsolution?

The proliferation of transport servicesmeans that, even for a straightforwardapplication such as Neptune Printing’s,choosing one is more complex than itmay seem; it’s necessary to consider thetypes of questions listed above beforerecommending a solution. Each type oftransport has its own strengths andweaknesses from a customer perspectivewhen compared to the other, as high-lighted below. For the purposes of thisexample, we will assume that Neptunehas significant bandwidth needs, asmight be required to transmit detailedphotographic images. Two typical solu-tions that could perform this level oftransport are SONET and Ethernet.

Comparing suitable technologies

First, let’s consider SONET. It offersmany benefits; it’s a mature technologythat is extremely (over 99.999%) reliable.In addition, a SONET network canautomatically recover from a fiber cut inless than 50 milliseconds, and offersperformance and alarm monitoring.

Sounds great? There are also downsidesto choosing SONET. Installation andconfiguration of a SONET networkrequires a lengthy interval measured inweeks or months. Further, it can bescaled only in large increments. IfNeptune had an OC-3 network (155Mbps), its only options for increasingbandwidth would be to add another OC-3 circuit or to upgrade to an OC-12 (622Mbps). Either of these choices wouldrequire another lengthy installationinterval. Plus, users pay for all the fea-tures that SONET offers. MaybeNeptune could get by just fine without50-millisecond automatic restoration ofits network.

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So what about Ethernet? It doesn’t offerthe same level of recoverability and reliability as SONET. It is a relativelynew technology outside of the LANenvironment, and it doesn’t come withthe kind of performance monitoringoffered by SONET.

What Ethernet does do is provide band-width, and lots of it. Further, it’s cheap;next-generation technologies likeGigabit Ethernet are 30% - 70% morecost-efficient than legacy networks(Lehman Brothers / McKinsey, Aug.2001). These cost savings can be passedthrough to customers.

Ethernet’s long history within corporateLANs means that a company’s IT per-sonnel are likely already familiar with itsuse and will easily be able to connect itto existing internal networks.

Further, its simplicity means that it ismore easily scalable and can often beinstalled mor quickly than SONET.

The strengths and weaknesses of bothSONET and Ethernet must be evaluatedagainst the needs of Neptune Printing.In this very basic example, it seems like-ly that Ethernet would be the best choicefor Neptune. Imaging data probablydoesn’t need to be transmitted in real-time; it’s not like sending voice or videosignals, where any delays hamper theusefulness of the connection. Any datathat doesn’t come through flawlessly cansimply be resent.

Further, Neptune probably doesn’t needto have near-instant network restorationin the case of a network problem. Itsbusiness depends on providing printingservices, where a few seconds or evenminutes of downtime is unlikely toseverely hamper operations. Perhaps abackup T-1 circuit would provide a levelof protection without having to pay forSONET. All in all, Neptune could prob-ably save money while still getting thejob done by using Ethernet.

This is clearly a very simplistic example.Neptune undoubtedly has other telecom-munications needs besides transmissionof its imaging data. Perhaps the compa-ny has an internal telephony system likea PBX, a need for offsite backup storageof important information, or a largenumber of cell phones and laptops withremote access for its sales force.

Creating solutions

One way that a service provider can dif-ferentiate itself from its peers is to sell“solutions” to its customers, rather thanproducts. As a full-service provider,SBC could very well be able to meet allof the telecommunications needsNeptune Printing faces. For example,one way that SBC could make its

Ethernet product more attractivewould be to bundle it with other

14

continued from page 14SELLING SOULTIONS

services that Neptune may need, such aswireline or wireless voice services, ordata storage capabilities. Such a strategywould have the added benefit of lessening SBC’s need to compete strictlyon price for the Ethernet business.

The example of Neptune Printing can beapplied to all competitive situations. Intoday’s market, simply selling a stand-alone product at a competitive price isnot seeing the whole picture. A success-ful salesperson will help their customerevaluate the various available options,and recommend solutions that in somecases may go above and beyond the spe-cific need the original contact was basedon. Service providers that can providethis type of additional benefit will begreatly enhancing their efforts to retaintheir existing customer base and gainnew customers.

Rick is Associate Director-Strategy, SBC. Heearned a Master’s Degree at the University ofIllinois-Urbana-Champaign and an MBA from Northwestern University’s Kellogg School of Management. He previously workedfor the U.S. Environmental Protection Agency.

Broadband A Hit In Sports

SBC now has more than 2 million DSLInternet access customers. That stronggrowth is driven in part by people whoare using the product in new andinnovative ways. Take the world ofsports, where fans now take for grantedservices none of us dreamed of just afew years ago:· Enhanced coverage of games availablefrom sports networks.· Instant Polls that allow viewers topretend they’re managing a team ormaking decision in the World Series orSuper Bowl.· Streaming Radio Play-by-Play andVideo Highlights and Photos—perfect

when there’s no TV coverage or whenteams want to supplement what’s avail-able.· Fantasy Leagues where fans create playon teams they’ve dreamed about.· Online Virtual Tours of stadiums, pre-views of seating options, online ticketingand ticket printing at home.· Customized home pages that featureyour team’s scores, schedules and news.Customers with SBC Yahoo! can do evenmore—set up their browsers to add but-tons from virtually any sport, so they canjump from their home page right to thelatest sports news. They can select a per-sonalized scoreboard, so scores are visi-ble as soon as you open the browser. Andthey can use SBC Yahoo! to set up a cal-endar for their favorite team.

Paying Bills Online

The total number of online billing cus-tomers in SBC jumped 266% in 2001from the previous year. In about twoyears of offering its eBill service, SBChas nearly 700,000 customers payingbills online.

“The growth rates SBC has seen, showthere is a demand for this service,” saidJason Briggs, senior analyst at theYankee Group. “Large telecom carrierswill play a significant role in drivingmainstream adoption of Electronic BillPresentment and Payment (EBPP).Telcos have the most penetrated servicein the U.S. home—local phone service—and an audience of broadband DSL sub-scribers (as well as dial-up) with which topromote eBilling. Our research showsthat a broadband-enabled household isalmost two times more likely to pay billsonline than a dial-up household.”

A Yankee Group Study shows 8.9 mil-lion households pay online and thisnumber is expected to double by 2004.

Saving money is one of several factorsspurring more people to sign up foronline billing. People use online billingto eliminate writing checks every month,to save time, to view bills online andkeep a record of their bill.

“Customers are quickly realizing thatonline billing is a convenient and secureway to pay bills and a great way tosimplify life,” said Yoland Martinez,Director of Online Billing at SBC.

To find out more about how you and yourclients can use eBill to save time and money,contact your Liaison Manager (1-800-552-5299).

What Ethernet Does Dois Provide Bandwidth,

and lots of it.Further, it’s cheap; next-generationtechnologies like Gigabit Ethernet

are 30% - 70% more cost-efficientthan legacy networks.

These cost savings can be passedthrough to customers.

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Data with David

“Integrated Access” isa term heard in theindustry today thatdenotes theconsolidation of voice

and data services on one pipe withenhanced customer service, includingoutsourced network management, con-solidated billing and single points ofcontact. It provides small and mediumbusiness customers with a consolidatedaccess to a full suite of high-speedtelecom services.

Customers have desired a singleintegrated T1 solution that provides costsavings with a bundled price andsimplified network management byconsolidating CPE from multiple devicesto just one. They want reliability fromtheir network provider and flexibility tochange service options as their businessneeds change. They also want convenience and the ability to buy packages of local voice and data services,high speed Internet access, long distancevoice and data services, web hosting,voice mail, calling features in a singlepackage at a competitive price from asingle point of contact.

T1 Integrated AccessSBC has introduced an in-territory T1Integrated Access porduct that providesa business service solution combininglocal voice, long distance (available incertain SBC areas), Internet, frame relayand CPE into a menu of services that canbe customized to fit each customersneeds. Customers who have businesslocations with between 8 and 22 linesand combined telecom expendituresbetween $1,000 and $2,000 per monthare good candidates for this service.

The new T1 IntegratedAccess product provides:

Transport – a channelized (1.5Mbps) thatdelivers up to 24 channels of DS0 leveldata and/or exchange voice service tothe nearest DCS (Digital Cross Connect)equipped central office. Local Exchange Services – includesindividual and multi-line businessservice, PBX trunking, Direct InwardDialing (DID) and Centrex service.Frame Relay Service for DataNetworking – SBC’s Advanced ServicesInc. (ASI) Interstate UNI Port will beoffered for permanent virtual circuits atspecified rates lower than the UNI portspeeds shown under Dedicated InternetAccess below.Dedicated Internet Access – DIA willbe offered in conjunction with ASI’sframe relay service with speeds of128Kbps, 384Kbps, 512Kbps and768Kbps.Dedicated Voice Access – SBC Long

Tom David, SBC Distance will provide customers withlong distance options. In addition to thetraditional DS1 point-to-point service,Dedicated Voice Access will be offeredin two new serving arrangements for T1Integrated Access. Customers may haveDVA 6–pack and DVA 12-pack offeringsthat are point-to-point connectionsbetween the SBC Long Distance Point ofPresence and the customer specificedDCS equipped central office.

And last, the customer requires anIntegrated Access Device (IAD)or CPEthat takes the channelized T1 signal andsplits it between several differentinterfaces so that the single T1 can beshared by multiple services. SBCDataComm will sell the customer theAdtran TA 850 and TA 612 to providethis interface. In addition to providing aplatform for analog and digital voicesupport, Total Access 850 has a built-inIP router, management, and a migration

path to next generation ATM services(through a flash-upgrade). SBC can useremote inband management of the TA850 to turn features, functions, andaccess ports on or off based on customerrequirements. (The TA 850 may beviewed at:http://www.adtran.com/Common/_Adtran/images/ta850.htm)

SBC also provides the Adtran TA-612that has exactly the same functionality asthe TA-850. The benefit to the customeris that the fixed port is less expensivethan the TA 850 which retains fullmodularity. The “fixed-port” refers tothe number of analog POTS linessupported in the IAD, via the amphenolconnector to the 66 block. The TA-612can support 12 analog POTS lines. TheTA 612 does not support DSX-1; and thisis a main differentiator. Any customerrequiring digital connection for voice (toPBX) will need to purchase the TA 850.

Qualifying Customers

Customers best suited for IntegratedAccess service have:Between · 8 and 22 analog lines· Average greater than $500 per monthin long distance expense· Utilize Internet access for e-mail andbrowsing (the direct Internet access @768Kbps is the highest speed offeredwith Integrated Access and it willsupport up to 30 users)

· Data networking services like framerelay. The Integrated Access solutionoften provides the most efficient way toeliminate unneccesary access costs aswell as equipment costs since a router isincluded in the IAD.

Single Point-of-Contact

SBC DataComm is the single point-of-contact when trouble shooting problemson Integrated Access. When reportingtrouble to SBC DataComm they willhelp isolate the trouble and coordinaterepairs with SBC, SBC Internet Services,SBC ASI or SBC Long Distance.Similarly, billing support and inquiriesare directed to SBC DataComm forprocessing.

Billing

Integrated Access has many variations ofproduct mix that prevent billing ofservices at one bundled rate. Instead,customers will select from a menu ofservices and be invoiced for the servicesindividually. The billing for localservices will appear on SBC’s billtogether with separate affiliate pages forSBC ASI and SBC Internet Services.SBC Long Distance charges (except forswitched long distance service notcovered by a high volume calling plan)and SBC DataComm (Adtran TA 850and TA 612) will bill direct.

Pricing

Pricing for this service may be obtainedthrough the account team, authorizedsales representative or your consultantliaison manager.

Summary

T1-Integrated Access Services is acomplete solution that allows yourclients to combine, over a T1 access line,their local and long distance service,Internet access and data servicesutilizing a single integrated accessdevice. It offers business customerssavings, convenience, reliability andflexibility. Customers may now select amenu of services tailored to fit theircommunication needs.

Tom DavidLiaison Managertd1898@sbc.com

15

“A leader is a merchant of Hope.”

Napoleon

Customers Have Desireda single integrated T1 solution that

provides cost savings with a bundledprice and simplified network

management by consolidating CPE frommultiple devices to just one.

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Vendor Spotlight

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designed automated information systemthat effortlessly takes you exactly whereyou want to go? The answer will tell youwhether customers who call your companycome away feeling frustrated or satisfied.Automated information systems (commonly referred to as call routing applications) are as essential to companiestoday as the banks of operators were to thecompanies of yesteryear. Whether yourcompany is large or small, you will need acall-routing application that efficiently andcost-effectively serves the needs of yourcustomers. In fact, successful businesses donot view these applications as a replacementfor a human attendant, but as a tool to helpsavvy customers get where they want to goas quickly and efficiently as possible.

Even the most basic phone and messagingsystems can allow users to quickly reachtheir party by keying in their extension, alsoknown as “auto attendant” or using a simplemenu to route directly to information suchas phone numbers, addresses, or instruc-tions for obtaining forms. Designed correctly,call routing applications can enhance productivity and give your company a moreprofessional image. Designed incorrectly,they can drive your customers away.

In order to ensure your customers’ acceptanceof your call routing system, it is critical thatyou take the time to plan, design and implement a caller-friendly application.Below we’ve included a few tips to help youdesign a simple, direct diagram (or callflow) and write a clear, concise script.

Design the Diagram

Your first step is to diagram your callrouting application. If you don’t have flowcharting software, a pencil and paperwill do. Draw a box, also referred to as a“cell,” to represent a transfer point or audiomessage. Connect these cells with lines toform the structure, which may resemble apyramid or tree. This drawing will help youcraft your script.

Most people cannot remember past three orfour choices so anticipate what your customers are calling for and design yourmenus accordingly. The most frequentlychosen menu option should always be first.

Give the caller the option to repeat themenu or spoken information by pressing akey. Use the same key throughout the application for consistency. You may alsowant to dedicate a key to returning thecaller to the previous menu in case they’vemade a mistake.

Consider how the caller will exit the callrouting application. Some systems allow a“goodbye” message to be played prior tobeing disconnected.

Finally, always provide the caller with theoption of pressing “0” to speak with aknowledgeable person during businesshours.

Write the Script

The way you convey information throughspeech is different than in writing. Your callrouting application will be heard, not readso try to keep the script in a conversationaltone. Do not read your company’s brochureword for word!

Use contractions as you would in everydayspeech (i.e., “you’ll” instead of “you will”).

* If you have a complicated menu, speakthe menu titles to keep callers from gettingconfused. * Avoid acronyms and technical jargon.

Implement the Technology

Finally, take the time to properly implementyour call routing application. Beforerecording the application, conduct staff auditions to find the best voice to reflect yourcompany. Use the same, professional qualityvoice talent throughout the application.Typically, a female voice is preferred whengiving instructions; a male voice for information. You may also consider hiringprofessional voice talent.

Thoroughly test your application for any programming or recording errors. Often thiscan be done before cutover. Choose a lowtraffic day for implementation to minimizeany problems due to programming errors.

If your company has a web site with similarinformation, be sure the content of the weband call routing application match. You canalso maximize both systems by referringcallers to the web site and web site visitorsto the call routing system. Don’t forget toinclude a diagram of the call routing application on the web site.

Advertise your new application to your customers through a mailer or other means.Include a copy of the diagram when appropriate so callers have an idea what toexpect. Anything you can do to increase thecaller’s acceptance will reduce the numberof complaints about “talking to a machine”and improve customer service.

You may also consider hiring a consultantto conduct an analysis of both the call flowand script. It’s important to make sure yourcall routing application complies withtoday’s industry standards. A consultantcan also audit an existing application foraccuracy, errors, and sense. Don’t simplyinstall your application and forget about it.Make a point to call it from time-to-time tocheck it for errors and changes. Perhaps aphone number associated with it was disconnected. Don’t rely on your customersto point out these errors to you!

Craig Tanikawa and Michelle Walker - Martin are Project Managers forPinnacle Bay Resource Group, Inc., a vendor-independent telecommunicationsproject management and consulting firm. Website: www.pbrg.com, Email:info@pbrg.com

continued from page 1FRUSTRATED OR SATISFIED

Opinions expressed are not necessarily those of SBC.

SBC Wins StateEndorsementFor Long Distance In Nevada

As we were going to press, the PublicUtilities Commission of Nevada (PUCN)endorsed SBC's application to provideLong Distance service in Nevada. SBCexpects to file its Nevada application withthe FCC in early January.Federal regulators will have 90 days toconsider and vote on theapplication. "This support of our LongDistance application means we are agiant step closer to bringing Nevadansmore choice and value as well as theconvenience of one-stop shopping for alltheir communication needs," saidSylvia Samano, president of SBC forNevada. The PUCN held several hear-ings, gathered input from the industry,public and their staff as well as theBureau of Consumer Protection in orderto make their decision.

Unsung Heroes Help TheirCommunities

The SBC Pioneers, a volunteerorganization of nearly 200,000employees and retirees, contributednearly 8 million hours of communityservice last year to enhance thecommunities where they live and work.

The Pioneers, the largest company-sponsored volunteer organization in theUnited States, help their communitiesby providing disaster assistance, literacytraining, beach cleanups, fooddistribution for the needy and specialathletic competitions for the physicallychallenged. At SBC, our connection withour customers goes beyondcommunications services, we want tomake a positive differencethrough the Pioneers.

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How To Avoid Wasting Time

SBC Inks Agreement to SellInterest in Cegetel

SBC has entered into an agreement tosell its 15% interest in Cegetel toVodafone for approximately $2.27 bil-lion in cash. Cegetel is a joint venturewhich owns 80% of SFR, the second-largest wireless provider in France withnarly 12.5 million subscribers. OtherCegetel owners include Vivendi,Vodafone and British Telecom.

· For service providers, all these benefitsadd up to lower capital costs, reducedcapital expenditures, and higher profitmargins

********************************

KEY: Although the focus here is on costreductions and related benefits for serv-ice providers (carriers), the standards ofcompetition do indeed come into play inthis context. If a service providers costsare reduced, those cost savings will ulti-mately be passed on to consumers in theform of lower service fees and charges.

********************************

In addition to POTS, T1, 10/100BASE-T,and DS–3; EPONs support advancedfeatures like Layer 2 / 3 switching,routing, voice over IP (VoIP), IPmulticast, VPN 802.1Q, bandwidthshaping, and billing. Revenueopportunities from EPONs include:

· Support for legacy TDM, ATM, andSONET services

· Delivery of new gigabit Ethernet, FastEthernet, IP multicast, and dedicatedwavelength services

· Tailoring of services to customer needswith guaranteed SLAs

· Quick response to customer needs withflexible provisioning and rapid servicereconfiguration

Paul is a Product Manager, BusinessMarketing, Optical Data Networks, SBC.He also teaches at DePaul University andcan be contacted atpaul.a.bedell@msg.ameritech.com. This article is an excerpt from his new book,"Gigabit Ethernet For Metro AreaNetworks", published by McGraw-Hill inDecember, 2002. It is available at majorbookstores.

continued from page 8EPON THE SIMPLE

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"Who Looks Outside, Dreams;Who Looks Inside, Awakes."

Carl Jung

Award Given for Innovative e-Commerce Strategies

Pfizer Inc. and Astra Zeneca have beennamed winners of the fifth annualSterling Commerce and the HealthcareDistribution Management Association(HDMA) Service Corporation award forBest Practices in Electronic Commercefor their innovation and implementationof the HEALTHCOM catalog for supplychain efficiency. The award is designedto recognize the most successful applica-tions of e-business technologies in thepharmaceuticals manufacturing and dis-tribution industries.

Formerly called the SterlingCommerce/HEALTHCOM award, recog-nition of this year’s winners was made atthe recent annual meeting of HDMA atthe Biltmore Resort in Phoenix.

Through the HEALTHCOM CatalogServices from HDMA and SterlingCommerce, drug manufacturers are ableto upload detailed product pricing, pro-motion and logistical information foreasy access by distributors and othertrading partners. During the last five anda half years, the HEALTHCOM Catalog(www.healthcom.com) has been suc-cessful in making more accurate and up-to-date information available whileimproving efficiencies and reducingcosts.

Both Pfizer and Astra Zeneca, pharma-ceutical manufacturers, were honoredfor their innovative use and implementa-tion of the HEALTHCOM catalog as aprimary supply chain management toolfor distributors and other trading part-ners. Pfizer and Astra Zeneca were pio-neer users of the catalog, which today iswidely used among pharmaceuticalwholesalers and manufacturers alike.Barry Sommerville, Pfizer director ofinformation technology revenue cyclesystems, created the original catalog and,until recently, was responsible for main-taining it for the industry.

With consolidation an ongoing force inthe pharmaceutical industry, both Pfizerand Astra Zeneca have succeeded in uti-lizing the HEALTHCOM catalog toincrease operational efficiency during aperiod when the size of their enterprisesand trading partner networks wereundergoing rapid growth. Having alreadyexperienced e-commerce success withthe HEALTHCOM catalog before theirbusinesses expanded, both companies

made it a priority to integrate the cataloginto their operations as they increased insize and complexity.

“As Pfizer and Astra Zeneca demon-strate, e-commerce solutions continue tohelp the pharmaceutical industryimprove operational efficiencies,” saidRonald J. Streck, president and CEO ofHDMA. “Together with SterlingCommerce we continue to offer HDMAmembers new opportunities to lowercosts and better serve customers byincreasing supply chain efficiency.”

“Sterling Commerce is proud of whatwe’ve accomplished with HDMA and areespecially excited by the results of mem-ber companies like Pfizer and AstraZeneca in using the HEALTHCOM cata-log,” said Sam Starr, chief operating offi-cer, Sterling Commerce.

Through the alliance between SterlingCommerce and HEALTHCOM, SterlingCommerce provides business integrationexpertise and e-commerce solutions toHEALTHCOM members.

SBC Moves to a SingleNational Brand

To further establish itself as a nationaltelecommunications leader, SBCCommunications Inc. (NYSE:SBC) has announced it will move to a singlenational brand - SBC. Use of the SBCbrand will provide a more unifiedpresence in the marketplace, making iteasier for customers to find and dobusiness with SBC companies acrossgeographic boundaries and productlines.

The move to a single national brand willunify offerings previously marketedthrough regional brands such as SBCSouthwestern Bell, SBC Pacific Bell,SBC Nevada Bell and SBC Ameritech.SBC companies will continue to offerwireless service nationwide throughCingular Wireless, SBC’s joint venturewith BellSouth.

It’s all about “we”

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SBC Positioned in Mexico

SBC owns an approximate 8 percentequity share in Mexico’s nationwidetelecommunications company, Telmex,which operates nearly 12.7 millionaccess lines. SBC has worked withTelmex to develop its network into oneof the most advanced in the world, andhas helped the company achieve its goalof enhanced telephone servicethroughout Mexico. Within the first fiveyears of privatization, more than 5.5million access lines were added, pro-viding phone service to thousands ofvillages where it had never beforebeen available.

DS-1:A 1.544 Mbps digital signal carried on aT-1 transmission facility.

DS-3:A 44.7 Mbps digital signal - theequivalent of 28 DS-1s.

EBITDA: Earnings before interest, taxes,depreciation and amortization.

EBITDA Interest Coverage:EBITDA divided by total interestexpense.

Frame Relay:A connection-oriented high-speed datatransport service that facilitates theexchange of data through predefinedpaths.

Free Cash Flow:The excess cash that is generated from abusiness. Cash from operations less con-struction and capital expenditures.

Internet Access:A service that provides a gateway to theInternet for the user.

InterLATA:InterLATA calls are long distance callsthat originate in one LATA andterminate in another. With theTelecommunications Act of 1996,RBOCs must satisfy certain criteria to beable to provide interLATA long distanceservice.

Internet Protocol (IP):Part of a family of protocols that tracksthe Internet address of nodes, routesoutgoing messages and recognizesincoming messages.

Interstate Access:Interconnection of local networks withlong distance networks to originate andterminate state-to-state long distancecalls. Local exchange carriers chargelong distance carriers for originating andterminating access to the local networks.

ISDN:Integrated Services Digital Network, ahigh-speed network that enablessimultaneous transmission of data,graphics, video and voice over a singletelephone line. ISDN comes in 144,000BPS for the desktop or 1.544 Kbps fortelephone switches, computer and voiceprocessing systems.

LATA:Local Access Transport Areas are geo-graphic sectors established in 1984 bythe FCC for the administration of longdistance telephone service provided bythe RBOCs and the interexchange carriers.

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SBC & Cisco AnnounceStrategic RelationshipTo Deliver New Class of ManagedCommunications Services

SBC & Cisco have announced a newstrategic marketing and sales relationshipfocused on accelerating the delivery of anew class of managed business services,combining Cisco’s leading edge equipmentand SBC’s state-of-the-art transport andnetworking services. SBC also plans to useselect Cisco technology in its core networkinfrastructure to deliver emerging services.

The agreement is designed to address oneof the most pressing dilemmas faced bybusinesses today—the need to expand andupgrade communications technology tostay competitive, while at the same time,conserving scarce financial resources.

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Demand for Mobile ServicesStrong Internationally

China is adding about 4 million mobilesubscribers a month.

India is expected to add 8 million sub-scribers in the next 5 years.

In the United States, mobile minuteshave grown 45% over the last year.

Source: Healy & Co.

Access Charges:Fees paid by long distance carriers tolocal telephone companies for use oflocal facilities to originate or terminatecalls.

Access Lines:Local loop telephone lines providingtelephone service to individual residences and businesses.

Access Minutes of Use:The units of time used as the basis fordetermining the billing for the intercon-nection between the long distance net-work and the local loops in interstateand intrastate long distance calls.

Access Reform:The process by which access charges willbe restructured to better reflect the costof providing access to local networkfacilities. This process will involveremoving implicit subsidies and restruc-turing cost recovery mechanisms.

Additional Lines:Access lines in addition to a primary linesold to homes to meet increased demandfor voice, data and video products andservices.

Asymmetrical Digital Subscriber Line (DSL):Allows Internet users to surf the WorldWide Web at high speeds over existingcopper phone lines. DSL enables down-stream connection speeds of up to 1.5Mbps and upstream connection speedsof 128 Kbps.

Asynchronous Transfer Mode (ATM):High-bandwidth, low-delay packetswitching and multiplexing techniqueused to deliver traffic at varying rates,permitting a mix of voice, data andvideo.

CAGR:Compound annual growth rate.

Caller ID:A flagship product that allows customersto see a caller’s name and number beforeanswering a call.

Cash Operating Expenses:Operating expenses that excludedepreciation and amortization.

Channel Terminations:The number of end points of a data circuit.

Churn:The percentage of customersdiscontinuing service during a monthcompared to the average base during theperiod.

Cost of Capital:SBC’s weighted cost of its respectivedebt and equity capital. Each SBC sub-sidiary has a unique and identifiable costof capital appropriate for its businessand financial risks.

SBC Telecom Glossary

“Enjoy the journey.The journey is the reward.”

communication. A traditional audioconference may also be streamed. This allowsparticipants to listen to an audio conferenceby simply clicking on a link from the desktop.Webcasting is a natural extension to the1-800-CONFERENCE® current suite ofservices and helps organizations extend theircommunication savings, reach and impact.For more information contact 1-800-CONFERENCE®, at1-800-266-3373 and select option 1.

SBC Long DistanceStreaming Media

BroadcastWed. Feb. 19, 2003

9-11:30am PST

Featuring Ron Fischer, Director, BusinessLong Distance, SBC & Others.Streamers: To get the URL, please contactyour Liaison Manager on 1-800-552-5299or leave your name & email address onour Reservation Line: 1-888-889-6010 andyou'll be contacted.

To Participate in the Broadcast at SBCLocations in Sacramento, San Francisco,San Ramon, Pasadena, Los Angeles orAnaheim, please call your LiaisonManager or our Broadcast Line. ThankYou. We Look forward to your participa-tion in this important event, sponsored by

1-800-CONFERENCE®.

WHOSE NETWORK AREYOU USING?

If you ever get a phone call to change yourtelecom service from SBC, you might wantto ask:· Whose Network Are You Using?· Who Maintains That Network?· Whose Repair People Go Out To Fix It InAn Emergency?· Does Your Company Serve Everyone OrJust The Most Profitable Areas?

Liaison Manager(949) 855-5055Fax: (949) 348-2941e-mail: td1898@sbc.com27402 Camino Capistrano, Room 211, Laguna Niguel 92677Helps Consultants and Vendors in the following area codes:619, 714, 760, 858, 909, 949

Tom David

Liaison Manager(626) 576-3045Fax: (626)-576-5081e-mail: ls1869@sbc.com500 E. Main Street, Room 540 Alhambra 91801Helps Consultants and Vendors in the following area codes:213, 310, 323, 562, 626, 661, 805, 818

Lowayne Shieh

Data Administratore-mail: ea3515@sbc.com

Eric Aguirre

CVSG Vice President(415) 542-4516e-mail: kw6875@sbc.com370 Third Street, Room 711 San Francisco 94107

Kari Watanabe

Editor/ Communications/ Seminars/ Conferences(714) 284-2370Fax: (714) 563-1736e-mail: cm9816@sbc.com200 Center Street Promenade, Room 100 Anaheim 92805

Brian GriggsSBC Graphics & Advertising Department(210) 886-9996 e-mail: bg9183@sbc.com

Graphic Design

SBC Consultant/Vendor Sales GroupToll-Free Hotline 1(800) 552-5299 (for any other number, toll charges may apply.)

Vendor/Consultant Service Center — 1-800-773-3318, (fax) 877-778-4133, vcsc@sbc.com

Craig MacDonald

Thank You for reading

Update

Liaison Manager(415) 542-1071Fax: (415) 542-2648e-mail:bm1254@sbc.com370 Third Street, Room 711 San Francisco 94107Helps Consultants and Vendors in the following area codes:209, 408, 415, 510, 559, 650, 707, 831, 916, 925

Bree Ma

Consultant/Vendor Web Address To Change

As we were going to press, SBC Communications Inc. went to a single brand--SBC--that unifies offerings previously marketed through regional brands like SBC PacificBell. As a result, our Web Address (www.pacbell.com/Products_Services/CSG) will bechanging sometime in the future. If you're unable to get through, please contact ourteam at 1-800-552-5299. We'll be publicizing the new address once we have it.

Thanks.

“Optimism Is The Father That Leads ToAchievement.”

Helen Keller

1-800-CONFERENCE®

Announces StreamingServices Powered by

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The 1-800 CONFERENCE® productportfolio is pleased to announce its newWebcasting service powered by Yahoo!Webcasting (also known as streaming) is anemerging technology that has shownincreased demand among customers lookingto send video or audio messaging to largeaudiences. The service is backed by Yahoo’sWebcast Studio Professional tool and a teamof event coordinators who take clientsthrough the process of presenting a live orpre-recorded event.

The most popular applications for this newtechnology include capturing video from anyvideo conferencing system and streamingdirectly to a viewer’s desktop. Unlikeswitched telephone and ISDN charges, thelarger the audience involved the bigger thesavings over traditional forms of

“Light Tomorrow With Today.”Elizabeth Barrett Browning