Time Warner's VoIP Train - Multichannel

Time Warner's VoIP Train

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That noise you hear rumbling in the distance is the train of voice-over-Internet protocol in motion. The cable industry, after years of developing standards, testing equipment, certifying vendors and modeling business cases, is set to roll out VoIP in 2004.

Cablevision Systems Corp. is already offering the service across its New York-area footprint, Comcast Corp. plans three to four launches next year and Cox Communications Inc. will deploy in Roanoke, Va.

But the biggest splash in 2004 may come from Time Warner Cable, which has launched service to 8,000 subscribers in Portland, Maine, and is the midst of an East Coast to West Coast rollout of the service over the next year.

"In 2004, there is going to be an extensive rollout across most of our markets," said Gerry Campbell, Time Warner's senior vice president of voice. "You'll see a very concentrated effort in first quarter."

In addition to Portland, Time Warner has launched service in Raleigh, N.C., and other North Carolina and South Carolina markets could soon follow.

Beside Maine and North Carolina, the MSO has been granted authorization to launch phone service in New York State. It has public-utilities commission authorizations pending in Kansas, Missouri, Ohio and Texas, which would open up Kansas City, Columbus, Cincinnati, Houston and San Antonio, among other markets.

Next year's rollout schedule will follow the path of America's pioneers.

"It's really just as much an East-to-West mentality than anything else," Campbell said. "We're concentrating more in the East. It's just the way the regions are cut up."

Time Warner launched in Portland with a $39.95 a month offering for unlimited local and long distance calling, call waiting, caller ID and E-911 service. Voice mail is about to be launched.

Monthly prices can be $5 to $10 higher, depending on whether the subscriber takes to high-speed data or video service.

Time Warner is using Motorola embedded multimedia terminal adapters in Portland. The cable-modem termination systems media gateway and soft switches are supplied by Cisco Systems Inc., although Campbell said Time Warner is testing other vendor equipment for possible launches in other markets.

Time Warner is using battery backup power for the EMTAs.

A small local telephony company, Pine Tree Networks, serves as intermediary between the MSO's network and the public-switched telephone network.

"We get dial tone wholesale from somebody else [Pine Tree]," said Campbell, and that's the model Time Warner will follow in other markets.

Calls from a Time Warner VoIP subscriber in Portland are routed from the home, through the EMTA, back to the Cisco CMTS. The soft switch for Portland is actually in Syracuse, N.Y., and that switch will eventually serve the New York City market.

"That's what changed the dynamics of this business," Campbell said — the ability to locate soft switches in regional locations that can serve several states.

Road Running

Time Warner will rely on its Road Runner data-over-cable national backbone to handle VoIP calls. It may only need dozens of soft switches to serve its systems across the country.

The soft switch in North Carolina, for instance, will also serve South Carolina markets.

"Our architecture is such that when I turn up North Carolina, I can light up both states," he said. A soft switch in Kansas City will be able to serve Memphis and Milwaukee, he said, while the media gateways will be more localized in individual systems.

In other markets, Campbell said Time Warner will look for companies like Pine Tree to deal with local phone companies, route traffic and help to address the E-911 issue.

"We wanted to have a wholesale, retail association," he said.

Campbell emphasized that Time Warner VoIP traffic never travels on the public Internet.

"It stays on our networks, and is then passed on to our partners," he said. "We have quality-of-service on our networks, and we have service level agreements with our partners."

Data Subs Eyed

On the marketing side, Time Warner is targeting its high-speed data customers, but will sell phone service to video-only and even non-video customers. So far, Time Warner has used e-mail, telemarketing and door-to-door tactics to market the service.

"It reminds me of new-build construction, starting from the headend and going node by node to the end of the plant," he said. "We're marching through a market, node by node. It's a very concentrated effort, all the way through."

By turning service on node by node, Time Warner can pinpoint marketing tactics and handle the volume of new subscribers and any attendant scaling issues that might crop up, he said.

Campbell said although VoIP is launching from Time Warner's corporate structure, "our model is to not silo this product at all.

"At the divisions, we try to get it to be as seamless as possible. It will be sold by residential marketing. We're trying to do the integration as soon as possible. That maximizes the revenue."

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