Ray Richards is founder of Mindspan Consultants and a technology journalist hailing from Ottawa, Canada

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Magma ADSL Service Interview

As the Internet has increasingly become a vital component of many small businesses, and as content has driven an insatiable hunger for bandwidth, I thought an investigation of the emerging connectivity medium ADSL (Asymmetric Digital Subscriber Line) would be a great place to start a monthly column dedicated to the discussion of the appropriate alignment of technology with business processes, as pertains to the small office environment.

Up until very recently, ADSL was only available to residential clients through Bell Canada's Sympatico Internet service provider. Now Ottawa companies like Cyberus, Storm Internet, and Magma Communications are coming on-line with commercial ADSL offerings, generating a great deal of curiosity and enthusiasm in the small to medium business community. In an effort to better understand this new service, I conducted an interview with Randy Byers and Ron Ethier of Magma in which we discussed the benefits, limitations and obstacles associated with their impending roll out of ADSL.

OC: You've announced that you're going to be offering ADSL to your client base before Christmas 1998, can you explain what this service is?

Ron Ethier: ADSL is a high speed digital service whose main advantage from a costing point of view to our clients is the local loop - which is historically the portion users would get from Bell Canada on a T1 for example. The cost there is less than 10%, so they're saving upwards of $900.00 per month just on the physical line going into the office. It gets carried over regular copper and we are able to send high speed data over that standard copper phone line.

OC: So how fast is it?

Ron Ethier: It can be anywhere from 64K all the way up to 7 megabits per second. So it's scalable and we can tailor it to our users particular application. We have different rate levels for different bandwidths depending on what the user wants to pay for. The services are also asymmetrical; which means that the upload and download speed is not necessarily the same... they can be - but not necessarily. For example you might have 7 megabit downstream while upstream you might only have 1 megabit... which is still, you know, astronomically fast compared to say 56K. It should be a very well received product in downtown Ottawa primarily...

Randy Byers: Our service will be commercial only, targeted at businesses in the downtown core.

OC: I understand that Magma has been having a bit of a war with Bell Canada over the provision of ADSL services. Could you explain a little bit about that?

Randy Byers: I guess all ISPs in general are very concerned about the fact that Bell can offer (through it's company Sympatico) a high speed service to home users at $65.00 a month whereas another ISP would require at least $100.00 a month to provide a similar service offering.

OC: So you think that's unfair business practice?

Randy Byers: Sure. Absolutely. They're subsidising that service... they're losing money offering this service at that price and they're subsidising it through our telephone rates probably. So you pay your phone bill, we pay our phone charges, our long distance etc... and they're using this money to try to put us out of business because we can't offer it at that same price.

OC: So have you taken any action to address this issue?

Randy Byers: A group of ISPs got together and filed with both the CRTC and the Competition Bureau, however we're still waiting for an outcome on that.

OC: So how popular do you think this service is going to be?

Randy Byers: We're not sure. The service is distance sensitive in terms that the customer can only be so far from the ISP's  point of presence... this plays a big factor. So if the client is too far away then ADSL wouldn't be a feasible solution.

OC: How close is close enough?

Randy Byers: We're still doing testing but it can be anywhere from 1 to 4 kilometres from the downtown location.

Ron Ethier: The impending ADSL service has been well received by our clients and we already have a number of signed contracts ready to go.

OC: Is there signal degradation the further you go out?

Ron Ethier: That's right. It's rate adaptive technology, so if you're 100 yards away you should be able to get the full 7 megabits per second, whereas if you were 4 kilometres away you might only get 1 megabit ...which is  still a lot better than 64K ISDN.

OC: So how are you going to cost this out?

Randy Byers: We have different pricing structures, for instance the client may order a particular level of service but if we found we could only provide a lower level, we would shift the price to reflect that.

Ron Ethier: Also if you are able to receive a rate of 7 but you only want to pay for 2, we are able to throttle it back on our side so that you get 2.

OC: So How much is this ADSL going to cost us?

Randy Byers: The customer should call us. Again, it's distance sensitive so we would give them a quote based on their location and such... but it should run anywhere from $400.00 to $1200.00 a month depending on the bandwidth package they selected.

OC: So, what's the story for Magma in the future?

Ron Ethier: With the recent purchase of Intranet Technologies, we now have POPs (ed.: points of presence) in three cities: Ottawa, Montreal and Belleville so an avenue that we might explore is opening POPs in other locations and making the existing POPs as large as our presence in Ottawa. Also if the ADSL pilot in Ottawa works out as we expect it will, we'll roll out the service in Montreal as well.

ADSL offers several key advantages over traditional connectivity technologies and bears further examination by anyone serious about their Internet connection. It makes the promise of quality video over the net a reality, makes short work of massive file transfers (ideal for industries such as graphic design, printing or advertising), facilitates electronic delivery of software products and upgrades and much more - all at a fraction of the cost of older technologies.

For more information, check out www.adsl.com. Ottawa Computes would like to express our sincere appreciation to Randy Byers and Ron Ethier for taking time out of their hectic schedule to allow us to conduct the preceding interview. Go to Part 2 of the interview.

Originally published in Ottawa Computes!, January, 1999, by technology columnist, Ray Richards.


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