The Internet has been long touted for its E-Commerce capabilities. Some even predicted the complete migration of customers purchasing from in-store, phone and fax to on-line in just a few short years. This view of the world has proven far too optimistic and unreasonable. There’s no doubt E-Commerce will grow and become an ever more important component in every retailers customer service offering. Perhaps the most overlooked aspect of the Internet is its viability as a low-cost data/voice communications vehicle.
Internet as Communications Vehicle
From its very founding roots, the Internet has been based on a collection of technologies to exchange information between different or unrelated computers – i.e. communications. The Transmission Control Protocol/Internet Protocol (TCP/IP), a.k.a. “IP” was developed in the late 60’s and early 70’s. Its early life was supported by the Department of Defense and quickly became the networking standard of all UNIX based systems. Microsoft first implemented TCP/IP in “Windows95” in the mid-90’s and eventually adopted it as its standard networking protocol with the release of Windows ’98. This dramatically accelerated IP’s entrenchment as the networking protocol of choice, both for UNIX and PC based systems, and is widely believed to have unleashed the Internet connectivity boom of the late ’90s.
IP based communications packetizes each block of data and transmits it through a series of routes to its final destination. As such, it has the advantage of being a many to many topology thereby enabling multiple devices to communicate through the same circuit, consecutively. Furthermore, the networks are often redundant, so if one route between devices is unavailable, the packet is automatically rerouted through alternate channels.
The Old Way – Leased Data Circuits
Traditional approaches to data communications to have revolved around telephone based dedicated data circuits. These circuits, while quite reliable, were generally low in bandwidth, and expensive. Variations included 9600 baud (9.6Kbaud) analog point-to-point 4-wire leased lines, as well as 56,000 baud (56Kbaud) digital point-to-point circuits. Frame Relay circuits have served a role too, especially in geographically diverse areas. (Frame Relay is in essence a proprietary version of the Internet developed by telephone companies (telcos) and sometimes offers substantial savings over point-to-point circuits.) Even simple dial-up phone lines have been used for branch connectivity, provided they’re local and don’t incur long-distance toll charges. Costs for these point-to-point circuits range between $50/mo for simple dial-up, to nearly $1000/mo for higher speed data circuits, especially when they cross telcos borders. The costs have been traditionally held high due to tariffs and fees imposed by the local phone monopolies, and have been “leased” by the customer.
Dumb terminals/printers vs IP-based devices (PC’s/Print Servers)
Equipment used on Leased Data Circuits generally employ “serial communications” and requires a one-to-one connection between the host computer and its terminal devices. Examples range from simple terminals, also known as “dumb” terminals, and printers, to more sophisticated IP based devices retrofitted to communicate via “serial” protocols. Multiplexors are often used to support multiple serial devices over a single data circuit. Communications equipment (modems, DSU’s, multiplexors) costs are moderately high but terminal equipment is affordable, simple and easily maintained.
“IP” based devices on the other hand, carry their communication traffic on a common link. Each device has its own IP address and is able to respond to the packets addressed to itself, without interfering with other packets destined for other devices on the same link. The communications gear (routers, hubs) is generally inexpensive. However, the terminal equipment (PC’s and Print Servers) are more expensive and complex, leading to more software and maintenance. PC’s generally deliver a wealth of additional personal productivity applications to the user, such as word processors, spreadsheet, Internet access, email and multimedia.
RITA – Remote Internet Terminal Access
Remote Internet Terminal Access (RITA), also known as “telnet”, represents a widely used method of communicating between computers. The remote computer, through the use of a terminal emulator, acts as a simple data entry/display device, with the host computer processing all keystrokes and controls access to the software and data. This information technology architecture is very prevalent in today’s mainframe or legacy systems.
While the remote users device must support “IP” based protocols (i.e. a Window’s PC), the RITA/telnet protocol sends remote user traffic over the user’s local Internet connection. This avoids long distance toll charges to the corporate system or use of an expensive leased line, and is ideal for a telecommuter or mobile sales force.
In fact, two wholesale suppliers (United American Sales, Wilmington, OH and Westgate Sales, Oakland, NJ) have recently implemented “RITA” connections for their distributor customers. This permits their customers to connect directly into their INFONETICS based accounting system to check order status, view inventory levels, and compute pricing. Eventual plans call for distributors to even place orders directly.
Security concerns do exist for simple RITA/telnet as communications are un-encrypted and could theoretically be eavesdropped on by unscrupulous individuals with access to the Internet. Good hardware based firewalls should be employed to protect your servers, allowing only RITA/telnet services through. This can be a restriction if your technology architecture requires use of other network services. Furthermore, login/passwording must be well managed on your servers so that only authorized users can gain access to your software and data.
VPN – Virtual Private Network
For those requiring better security, Virtual Private Networking (VPN) offers encrypted communications between devices. Both ends of a VPN connection must use a common encryption key, also known as a “private key”. The VPN devices then uses that private key to encrypt all packets exchanged between them. This technology is widely accepted as secure and reliable, even on the most open public networks.
VPN TUNNELING – Wide Area Network
VPN’s provide their services through the ability to “tunnel” through the Internet. Not only are the communications encrypted, but multiple Local Area Networks (LANs) are connected in a virtual Wide Area Network (WAN) configuration via this tunnel.
This allows secure exchange of all types of networked based services from File and Print Sharing to Network File Systems (NFS) also known as the “I: drive”. A correctly configured WAN can provide all services typically associated with a LAN, and can save thousands of dollars in line costs and reduce overall hardware and management expenses.
Other Networking Services
Internet access of course means much more than a communication route for your internal computer systems. It brings with it a whole range of additional services, many of which add great value to a distributors information management technology. Many have suggested that access to these services is at least as valuable as communications to the corporate mainframe. Some of these services are;
Web Browsing enable PC users to visit manufacturers web sites for product information and the ability to place and check on the status of orders.
Email is perhaps the most ubiquitous (beneficial/useful/universal/widespread/complete) tool for the late 20th century. This new form of correspondence is replacing phone calls to branch stores, along with the long distance toll charges they incurred. And the ability to send email, as well as file attachments, to multiple parties at the same time reduces duplicate efforts and increases awareness amongst all recipients.
This newest form of instant, nonverbal, communications, “Instant Messaging” rivals the telephone in its ability to interrupt and demand instant answers from “buddies” logged in anywhere on the Internet. Care should be exercised when implementing this technology as abuse is easy to allow and sometimes difficult to police. Users can easily appear to be working hard on company business while actually chatting with their friends on-line.
Voice-Over-Internet-Protocol (VoIP) phones allows you to connect telephone handsets in the branch to the main phone system in your central office. Actual phone conversations are digitized and packetized for transmission through the Internet. No more long distance toll charges to call the branch office. Better yet, with some phone systems, the remote handset can operate as a fully functional telephone capable of accessing voice mail and transferring calls. With a VOIP network, a company can save thousands of dollars a year on inter-branch long distance toll charges.
Types Of Connections
One of the tremendous advantages of “IP” communications is its ability to utilize a variety of Internet connection types. T-1 circuits provided by telco’s offer the highest bandwidth available (1500Kbaud), but also at the highest price point ($900-$1,500/month). DSL (Digital Subscriber Line) and cable modems offer similar broadband speeds at considerable price savings ($30-$120/month) over T-1 lines. These circuits generally offer 128Kbaud-768Kbaud upload speeds, with even faster download speeds. Even simple 56Kbaud dial-up circuits offered by local Internet Service Providers can be used for a mere $15-$25/month, plus the cost of the phone line. However, 56Kbaud dial-up lines should be used only as a last resort for small branches. Furthermore, static IP addresses are rarely available with dial-up circuits and therefore would not suffice for the main office connection.
Your servers Internet connection will also require a publicly accessible “static IP address”. Within the Internet, an IP address is akin to your telephone number. Many dial-up Internet connections are given a new (or “Dynamic”) IP address each time the connection is established. Just like in the telephone world, it would be difficult to receive incoming phone calls if your phone number changed every time it was used. So too in the Internet world, it’s difficult to connect to your server if it’s IP address is subject to change. Hence, a “Static IP Address” is one that doesn’t change over time.
Our case study is of a moderate sized, independent welding supply/industrial gas distributor. Their four branches are all located within 150 miles of the main office, but all are long-distance toll calls, two of which cross state (inter-lata) lines. Traditional 4-wire, 9600 baud, analog leased lines had been used to connect dumb terminals and printers in the branches to their mainframe system. Performance of the remote devices was acceptable, though newer technologies associated with Internet access were nonexistent. Communications costs for the three leased lines were approximately $1,200/month. The fourth branch had not been brought on-line due to the prohibitive cost of a leased line. Projected total cost using traditional leased lines was around $2,000/month.
A severe thunderstorm and lightning strike at the main office destroyed much of the serial communications hardware and dumb terminals/printers, so alternatives were investigated. 56Kbaud digital point-to-point circuits were initially promoted by the incumbent telco, but offered no significant cost savings or enhanced functionality. 56Kbaud Frame Relay circuits did reduce the overall monthly cost slightly, but required the inevitable transition to “IP” based terminal devices thereby making the investment payback quite long.
RITA+VPN was then investigated as a method of securely connecting their branches through the Internet. A typical DSL connection was projected at $80/month at the main office (including static IP), with an additional $60/month for each branch store. Two branches were not served by DSL so a cable modem provider was selected at slightly higher costs. Total monthly communication costs for the five Internet connections are now roughly $350, yielding a savings of $1,650 per month. This savings can be applied to the cost of the new “IP” based PC’s, communications hardware and print servers needed at the branches with a projected pay-back period of less than 1.5 years.
The additional benefits realized include Internet access, web browsing, Email and Instant Messaging between the branches. Long distance voice toll charges between branches are expected to be reduced dramatically as these new forms of interoffice communication replace traditional voice calls.
Implementation of any new technology can be fraught with potential pitfalls, and Internet based communications is no different. DSL and CableTV companies are struggling to ramp-up to the demand for their new low cost broadband offerings, and often promise services or installation schedules that aren’t met. Do not opt for “self-installation” of the equipment as there is still a great deal of technical know-how needed get these circuits up and running. A prudent implementer would research broadband availability and arrange its installation prior to disconnecting existing legacy equipment.
Long-term contracts for broadband service should be avoided if possible as costs continue to drop dramatically as vendors compete for market share. Today’s “bargain” will almost certainly be overpriced in one to two years time.
New, “IP” based PC hardware is generally more expensive to buy and maintain than its “dumb” terminal counterpart. Organizations must consider the deployment and maintenance costs for this new, more sophisticated platform.
Consideration will also need to be given to training employees on the use of new services. Like any new tool brought into the workplace, it should be accompanied by a realistic and thorough implementation and training plan.
Finally, web browsing, Email, and instant messaging can be tremendous productivity enhancing tools, they likewise can be easily abused by unsupervised personnel. Consider implementing an acceptable use policy before bringing the technology on-line.
The new Internet age has brought with it many promises – some of which are yet to be attained. Use of the Internet for its core strength as a communications vehicle though appears to be a technology that can dramatically reduce costs while equally dramatically advancing functionality and productivity.
What more can one ask out of a new use for an old idea?