Videotron Still Sees IP Rollout This Year


Las Vegas -- Le Groupe Vidéotron Itée and its vendor
partners last week reaffirmed their confidence that the MSO will be able to roll out
IP-voice services throughout Quebec Province before the year is out.

With four-and-a-half months of development efforts under
their belts since they announced the ambitious deployment agenda, the parties said they
saw no reason to push the launch date back, despite widespread skepticism that anyone
could offer first-line-quality voice service over the Internet-protocol-packet platform
within that time frame.

"We believe that we've got the dream team that
can make it happen," Vidéotron vice president Francois LaFlamme said, speaking at
the Voice on the Net conference here. "It's almost there."

The first step to proving that the system works will be
taken shortly in a series of tests at the labs of Telcordia Technologies Inc., the former
Bell Communications Research (Bellcore), which is supplying operations-management and
call-agent components.

"Their lab facilities give us an opportunity to shake
up the system extensively," LaFlamme said.

Following these tests, Vidéotron will launch a technical
test in the Montreal area using gigabit router switches, gateway interfaces with the
public switched network, headend-termination systems and other network-facilities
components supplied by Cisco Systems Inc., he said.

That test will expand to become a market trial in the early
fall and, from there, it will go to commercial launch "toward the end of the
year," he added.

The parties acknowledged that the big issue to be worked
through in the testing is scalability -- the extent to which the system can accommodate
expansion to tens of thousands of users across the 2.3 million-household base served by
Vidéotron in Quebec.

Moreover, they said, the initial level of reliability will
be below the Bellcore "five 9s" standard for telephone networks, which requires
uninterrupted service performance to each user 99.999 percent of the time on a
year-to-year basis.

"The network will easily support 'three 9s,'
if not 'four 9s,' from the beginning, and some elements, such as the trunking
gateways, will have even better reliability parameters," said Mark Bakies, who
oversees product management at Cisco's telephony-services unit. "The overall
performance will improve as we go forward."

While 99 thousandths of a percentage point may not seem
like much, this departure from five 9s reliability represents the major reason why most
MSOs -- currently led by the performance standards set by AT&T Corp. -- believe that
IP telephony won't be ready for primetime until sometime in the second half of 2000.

Moreover, Vidéotron is willing to use a call-agent
protocol -- Single Gateway Control Protocol -- that is an early version of the emerging
Multimedia Gateway Control Protocol, which is a key component of the still-evolving
PacketCable IP-telephony specifications.

But waiting for such incremental changes makes no sense to
Vidéotron, given the opportunities that it has to enhance revenues through integration of
services over the IP platform, LaFlamme said. Launching circuit-switched cable-phone
technology would entail twice the capital expense of using IP, he noted.

A key element of the bundled-services opportunity described
by LaFlamme has to do with the integrated billing system supplied by Kenan Systems Corp.

Built around a data repository of customer and network
profiles that avoids the use of application-specific information, the IP-based billing
system can be expanded to include any type of service within a single subscriber bill by
using a uniform data-input procedure in the back office, said Paul Varley,
Internet-products manager at Kenan, which was recently acquired by Lucent Technologies.

"You can twist the dials on the billing system, tell
it what to expect from the voice-over-IP platform and roll out the service," Varley