Charter Flips the Circuit Switch

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Charter Communications Inc. is now officially in the cable telephony business, but how it got there is literally a switch from the norm.

The St. Louis-based MSO, which has been testing Internet-protocol telephony technology for some time, became a residential voice provider last month when it took over a circuit-switched service as part of a system swap with AT&T Broadband.

But it wasn't as easy as flipping a switch. In just six months, Charter had to assemble the voice service business and then oversee a tricky customer migration.

With that now complete, Charter has gained something for its trouble: a jump-started telephony system and a valuable test bed.

It all started in June, when Charter and AT&T Broadband finalized a system-swap deal that included a franchise in the St. Louis suburb of St. Charles County, Mo.

AT&T had already rolled out a circuit-switched, constant-bitrate telephony product in St. Charles. After some deliberation, Charter agreed to take over the service within six months.

"We felt that it would be a disservice to the community and to the current customers to not continue the service, even though constant-bitrate technology was not the general direction Charter was pursuing," said Charter vice president of technology Mark Barber.

It wouldn't be easy. Since IP telephony was still in the early technical trial stage when the contract was signed, Charter needed to develop a billing, customer service and network management systems virtually from scratch.

"Even though we have deployed some trials, at that point in July we weren't even that far along with the trials," Barber said. "There were a lot of things that the trials really had not envisioned, including other technology trials — not only back-office pieces, but things like operator services and directory assistance and having the ability to support porting in customers and local number portability."

On top of that, the AT&T Broadband service was linked to an AT&T Local Network Services switch that wasn't part of the swap deal. So Charter would have to buy a new switch, install it, and then port customers' existing phone numbers to the new switch.

Then there was the process of ordering circuits and negotiating for connections with the incumbent phone company — a task complicated by the fact St. Charles franchise is split between two regional Bell operating companies, Verizon Communications and SBC Communications Inc.

The circuit-ordering process is so complex that the federal government provides a 1,500-page resource guide to fill out the two-page request form.

"Of the whole project, that was the most challenging timeframe of all," Barber said. "I think clearly the one thing that would surprise someone who has not done this type of effort before is the lead time you need on interconnection, and the lack of clarity on how you actually order circuits. "With all of these challenges, pro-IP Charter decided not to add IP migration to the mix. Not only would that have required replacing 16,000 customer network-interface devices, but the IP systems Charter was developing weren't yet far enough along for live deployment.

"As we looked at all of those different alternatives, we just felt that there were so many risks in converting them in a flash manner, if you will, to IP," Barber said. "We felt we were better off converting them as-is. Of course, down the road we will explore whether or not we choose to convert them to IP."

On Jan. 1 — armed with Convergys Corp.'s ICOMs system — Charter took over billing, as well as call center duties. On Jan. 13, the MSO began to migrate customers from the AT&T switch to the new one.

There were no real service outages during that two-week migration, except for a brief interruption in the early morning hours as engineers moved phone numbers to the new switch.

Meanwhile, Charter plans to start with test IP-telephony rollouts this year. That will likely include the St. Louis market area — leading to the possibility of side-by-side comparisons.

"I think it is something the whole industry doesn't know yet; what the buzz is going to be for voice-over-IP telephony," Barber noted. Though the two telephony offerings won't look that different initially, "we're looking at a whole variety of services that can be leveraged on the IP platform. The question is going to be, will the customers want them?"

Until then, the constant bitrate service will furnish Charter with some important market experience.

"What this does is position us very well now to launch more aggressively into telephony with the next foray, whether that is voice-over-IP or whatever — which, clearly, voice-over-IP is our stated direction," Barber said. "It also gives us a test bed where we can try some various bundling techniques and see what's most attractive to the customers.

"We view this as really as a major step in getting Charter into the telephony business and getting some experience under our belt."

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