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Molti Bravi, Euros, ARPU for IP Trio

Italy's FastWeb offers voice, pay-per-view, and broadband Internet over the same fiber link - serious competition for incumbent, Telecom Italia.

By Ellen Muraskin

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    12/04/2002, 8:48 PM ET

    Those looking for a good large-scale, cable VoIP story should direct their attention to FastWeb (Milan, Italy - http://www.fastweb.it/ - it helps to understand Italian), whose IP subscribership grew 35% in 2Q2002 and faster - 17,000 new subs in September alone - in the third. FastWeb is the darling division of Milan-based e.Biscom SpA (http://www.ebiscom.it/), a media and telecom carrier started up by IP veterans in 1999, with a 2000 IPO of 1.6 billion Euro. The company is now offering a "triple play" bundle of 10 Mbit Ethernet Internet access, VoIP, and video-on-demand in six Italian cities: Rome, Milan, Naples, Genoa, Turin, and Bologna. It has reached EBITDA breakeven ahead of schedule in less than two years, and has raised residential ARPU (Average Revenue Per User) from 720 to 780 Euros/year for the first half of the year, while drawing new 470+ new customers per day. The fast uptake by consumers is partially explained by one peculiarity of the Italian market, admits Guido Roda, Fastweb Network Service Engineering Director: Italy has no broadcast cable TV.

    FastWeb started as a broadband ISP to businesses in Milan, leasing single-mode fiber from affiliate company MetroWeb. By September 2000, they began offering the service to residential consumers in apartment buildings as well, adding voice and video-on-demand services. Late in 2001, they added the CCS Class 4/5 softswitch and SVI media server from NetCentrex (San Jose, CA - 408-521-7400, http://www.netcentrex.net/) to bring enhanced services and regulatory compliance to the VoIP offering. NetCentrex's deployment took four months, and raised the level and scope of voice service high enough to unplug residents and businesses from Telecom Italia.

    Local routing, QoS and voice gateway functionality relies on Cisco Catalyst switches located in the basements of multi-tenant buildings or in larger business customer premises. These also serve up LAN connectivity and analog or (BRI or PRI) ISDN interfaces. Small businesses typically hook up their PBXs.

    On the residential side, customers plug their phones and/or faxes into H.323 gateway/routers made to FastWeb's specs by three Italian companies: Telsey, Access Media, and Pirelli. These extend FastWeb's Ethernet access to TV set-top box or to PC, and also to analog phone and fax. Forty percent of FastWeb customers have chosen VOD; close to 100% choose voice and high-speed Internet, according to Roda.

    Video-on-demand comes in both pay-per-view (unicast) and "Near" VOD forms, in which case the movie requested is played from a continuous multicast loop. "Near" VOD downloads, priced cheaper, may start at any point along the film; it remains available for viewing for two to three months.

    System integration among four H.323 vendors, FastWeb's in-house billing system, and other components fell to HP professional services, assisted by Cisco and NetCentrex. Difficulty arose over the devilish details of "standards-compliant" gateways, as interpreted by the three makers, according to Roda. In spite of this, deployment of the NetCentrex voice components took only four months.

    FastWeb's calling plan includes eight hours of long-distance calling, unlimited free on-net calling, and pay-per-minute international and mobile. This plus 10 Mbit Ethernet to the Internet is 65 Euro per month. NetCentrex's platform allows FastWeb to route LD and international calls through its least-cost wholesaler; currently these include KPN, Cable and Wireless, and Telecom Italia. NetCentrex's CCS softswitches reside on 50 1U NEBS-compliant HP switching servers in FastWeb's two POPs, fed through a master load balancing server. If one of the 50 CCS servers should fail, FastWeb would only lose calls on that box in the process of call setup, says Brian Mahony, NetCentrex Marketing, allowing for carrier-scale growth.

    Both web-based GUIs to the softswitch and TUIs, customized and localized by HP, allow subscribers to select from and configure a large suite of Class 5-type and enhanced features. Those Fastweb has implemented include voicemail, caller ID, call blocking, and call forwarding. The CCS has also allowed them to comply with regulatory constraints, such as local number portability and legal interception of calls, with 100% voice over IP technology.


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