FOUNDATIONS OF

BUSINESS TELECOMMUNICATIONS MANAGEMENT

APPROACHES TO INFORMATION TECHNOLOGY

S.rl •• Editor Thoma. F. Carb.ry, Strathclyde Business School

University of Strathclyde Glasgow, Scotland

Foundations of Business Information Systems Andrew Doswell

Foundations of Business Telecommunications Management Kenneth C. Grover

Humanizing Technology: Computers in Community Use and Adult Education

Elisabeth Gerver

A Continuation Order Plan is available for this series. A continuation order will bring delivery of each new volume immediately upon publication. Volumes are billed only upon actual shipment. For further information please contact the publisher.

FOUNDATIONS OF

BUSINESS TELECOMMUNICATIONS MANAGEMENT

KENNETH C. GROVER Telecommunications Consultant

PLENUM PRESS • NEW YORK AND LONDON

Library of Congress Cataloging in Publication Data

Grover, Kenneth C. Foundations of business telecommunications management.

(Approaches to information technology) Bibliography: p. Includes index. 1. Business-Communication systems. 2. Telecommunication systems. 3. Telephone

in business. I. Title. HF5541.T4G76 1986 384 86-5063 ISBN-13: 978-0-306-42249-2 e-ISBN-13: 978-1-4613-2193-4 DOl: 10.1007/978-1-4613-2193-4

© 1986 Plenum Press, New York A Division of Plenum Publishing Corporation 233 Spring Street, New York, N.Y. 10013

All rights reserved

No part of this book may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, microfilming, recording, or otherwise, without written permission from the Publisher

To the memory of my son David

FOREWORD

lnfonnation technology is about more than computers. Thus, it was a recurring-and rather infuriating-aspect of the early

discussions on infonnation technology that those who participated tended either to ignore or to severely understate the role in infonnation technology of telecommunications. This very fine book by Ken Grover goes a long way toward correcting that misconception. However important the computer and computer-based equipment might be, the role of telecommunications equip­ment has also been and continues to be significant. Moreover, as the author brings out, it is going to be even more important. As this enthralling story unfolds the reader will find him or herself continually remarking that there cannot be more-but again and again, there is.

Those who are already of the world of telecommunications will, on reading this work, be proud of their colleague. Those who are already of the world of computers will learn a great deal and, it is to be hoped, will in future be fairer toward telecommunications than they have been in the past. Those who are new to the world of information technology will sally forth better balanced than most.

Thomas F. Carbery Strathclyde Business School University of Strathclyde Glasgow

vii

PREFACE

For almost a century since the invention of the telephone by Alexander Graham Bell there was no real change in telecommunications as a means for two people to converse at a distance. Moreover, telephone users had very little choice in the installations they had or the services available, having virtually always to take what the telephone companies, usually exercising a monopoly, were prepared to provide, and to accept the operating standards they decided were appropriate. Businesses generally valued the telephone as a means of communication, but, with good surface mail and the telegraph for occasional special needs, were not critically dependent on the telephone.

With the rapid and continuing advance in telecommunications technology over the last twenty years or so, there has come a dramatic growth in the dependence of industry and commerce on telecommunications. Reliance is now placed on telecommunications not only for the immediate conveyance of information by the spoken word, but also for the conveyance of data and other nonvoice intelligence. The operational and financial viability of industry and commerce now depend critically on telecommunications.

It is not surprising that the monopoly exercised by the long established telecommunications companies for so many years has been challenged. In many countries telecommunications users are being given increasing freedom to decide for themselves what installations and services best meet their needs, and have increasing influence on operating standards. In some countries com­panies are being allowed to develop networks and systems in competition with the existing ones. At the same time, manufacturers are entering the

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x Preface

telecommunications and allied markets for the first time to compete in the supply of terminals and systems.

Senior managers and members of boards of major telecommunications users, of competing network and service providers, and of telecommunications manufacturers, are now facing for the first time major investment decisions on which the future commercial viability of their businesses critically depend. This book seeks to inform them, going no further into the technical aspects than is essential, and to give them an insight into the complexities of the issues with which they must cope to reach sound decisions.

AUTHOR'S NOTE

The views expressed in this book are based on the author's experience over more than forty years in the British Post Office and later, British Telecom­munications. They do not necessarily represent the views of those organi­zations or of any other telecommunications company. The author remains very conscious, however, of the influence which the many colleagues with whom he was privileged to work have had in forming those views.

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CONTENTS

PART I: THE GROWTH AND DEVELOPMENT OF TELECOMMUNICATIONS

Chapter 1: INTRODUCTION .................................... 3

Chapter 2: HISTORICAL PERSPECTIVE ......................... 7

Chapter 3: TECHNOLOGICAL REVOLUTION .................... 11

Chapter 4: THE INTERFACE BETWEEN THE USER AND THE SYSTEM ...................................... 15

Chapter 5: DATA COMMUNICATIONS ......................... 19

PART II: TELECOMMUNICATIONS SYSTEMS

Chapter 6: TELECOMMUNICATIONS TERMINALS .............. 25 Voice Terminals .......................................... 25 Message Terminals ....................................... 29 Data Terminals ........................................... 32 Other Terminals .......................................... 34 Terminals-Summary ...................................... 37

Chapter 7: LOCAL TELECOMMUNICATION NETWORKS ......... 39 Internal Networks ......................................... 39 Local Networks Transmission ............................... 41 External Local Networks ................................... 42

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xiv Contents

Chapter 8: TELECOMMUNICATIONS SWITCHING ............... 45 Methods of Selection ...................................... 45 Active and Passive Switching Systems ....................... .47 Common User and Dedicated Switching Systems .............. .49

Chapter 9: MAIN TELECOMMUNICATIONS NETWORKS ......... 51 Main Networks Construction ................................ 52 Value Added Network Services and Leasing Operations ......... 55 Main Networks Summary .................................. 56

PART Ill: TELECOMMUNICATIONS STANDARDS OF SERVICE

Chapter 10: STANDARDS OF SERVICE ......................... 59

Chapter 11: SPEED OF INSTALLMENT ......................... 63 Distribution of Lines ...................................... 63 Installation of Terminals ................................... 65

Chapter 12: STANDARDS OF INSTALLATION ................... 67

Chapter 13: AVAILABILITY OF COMMUNICATIONS ............ 71 Switchboards ............................................ 72 Switching Equipment ...................................... 73 Main Networks ........................................... 76 Overall Standard ......................................... 76

Chapter 14: SPEED OF CONNECTION .......................... 79

Chapter 15: QUALITY OF CONNECTION ....................... 81

Chapter 16: RELIABILITY ..................................... 83

Chapter 17: SPEED OF REPAIR ................................ 85

Chapter 18: SECURITY OF COMMUNICATIONS ................. 89

Chapter 19: ADEQUACY OF SUPPORT SERVICES ............... 91 Number Information ...................................... 91 Assistance ............................................... 94 Public Pay Phones ........................................ 95

Chapter 20: USER RELATIONS ................................ 97

Chapter 21: CHARGING ACCURACy ........................... 99

Chapter 22: ENHANCEMENT AND DEVELOPMENT ............ 101

Contents xv

PART IV: TELECOMMUNICATIONS PLANNING

Chapter 23: THE NATURE OF TELECOMMUNICATIONS PLANNING .............. 105

Chapter 24: STRATEGIC PLANNING .......................... 107

Chapter 25: DEVELOPMENT AND PROCUREMENT PLANNING ...................... 109

Determination of Current Usage of Communications ........... 109 Forecasts of Future Requirements ........................... 111 Identification of Technical Options .......................... 113 Identification of External Factors Impinging on Telecommunciations Planning .............................. 115 Financial Appraisal of Options ............................. 116 Preparation of a Development and Procurement Plan ........... 117 Analysis of a Development and Procurement Plan ............. 118

Chapter 26: PREPARATION OF TELECOMMUNICATIONS UTILIZATION PLANS ............................ 121

PART V: TELECOMMUNICATIONS OPERATIONAL MANAGEMENT

Chapter 27: RESPONSIBILITY ................................ 125

Chapter 28: ACHIEVEMENT OF STANDARDS OF SERVICE ..... 127 Operator Services ........................................ 127 Dialed Services ......................................... 133 Installation Repair Service ................................. 137 Provision of Service ...................................... 139 Support Services ........................................ 142

Chapter 29: RESOURCE MANAGEMENT ...................... 145 Equipment Utilization .................................... 145 Manpower Productivity ................................... 147 Industrial Relations ...................................... 150 Financial Performance .................................... 152 Accountability .......................................... 153

PART VI: FREEDOM OF CHOICE

Chapter 30: MONOPOLY OF TELECOMMUNICATIONS ......... 159

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Chapter 31: REGULATION OF TELECOMMUNICATIONS ........ 163 Historical Background .................................... 163 Liberalization ........................................... 169 Competing Networks ..................................... 171 Cellular Radio Networks .................................. 172 Value Added Network Services ............................ 173 The Financial Implications of Liberalization .................. 174 Privatization ............................................ 177

PART VII: CONCLUSION

Chapter 32: FUTURE TRENDS ................................ 181

Chapter 33: PERSPECTIVE ................................... 183

APPENDICES .............................................. 185 United Kingdom Growth of Telephones in Service ............. 185 United Kingdom Growth of Inland Telephone Calls ............ 185 United Kingdom Investment in Local Telephone Exchanges ..... 186 United Kingdom Investment in Telecommunications Distribution ........................... 187 United Kingdom TelecommunicatIOns Annual Income and Expenditure ............................ 187 United Kingdom Net Book Value of Fixed Assets ............. 188 Telecommunications Operational Expenditure ................. 188

INDEX .................................................... 189