| BUSINESSWEEK ONLINE : MAY 1, 2000 ISSUE | ||||||||
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| SPECIAL REPORT
Birth of a New Communications Network It was 124 years ago when Alexander Graham Bell made his first phone call to Thomas Watson. Now the Internet is bringing fundamental change to the telephone network, lowering costs and adding a host of new features. Here's an overview of how the network is changing: THE OLD WAY: Long Distance Network Today's phone system is just a computerized version of Alexander Graham Bell's original design. It converts sound into electrical signals and shoots them across a copper network. It's simple and works well, but it's expensive. The switches that direct traffic across the network cost millions of dollars. And each call uses an entire circuit. That's like every car on the highway getting its own lane. The result: Long-distance calls cost about 10 cents a minute. THE NEW WAY: The Internet Internet technology is much cheaper than traditional phone gear. That's because its digital routers, which direct traffic on the Net, cost tens of thousands of dollars, not millions. What's more, each piece of data shares a line with data from other calls, just as cars share a highway lane. Parts of the same conversation often travel different paths, taking whatever route is available. The result: Long-distance calls can cost as little as 2 cents or 3 cents a minute. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP |
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RELATED ITEMS The Talking Internet TABLE: Birth of a New Communications Network CHART: Booming Voice on the Net TABLE: Telephones on Steroids Yahoo! Look Who's Yakking Away Europe Swoons for Voice-on-the-Net Where the Money Will Be CHART: Investing in Voice on the Net TABLE: Stock Stars INTERACT E-Mail to Business Week Online | |||
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