Final Report Minnesota Telefutures Study Group
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This document is made available electronically by the Minnesota Legislative Reference Library as part of an ongoing digital archiving project. http://www.leg.state.mn.us/lrl/lrl.asp FINAL REPORT OF THE MINNESOTA TELEFUTURES STUDY GROUP (MTSG) TO THE MINNESOTA PUBLIC UTILITIES COMMISSION November 19, 1993 TABLE OF CONTENTS Executive Summary i-iii Section I: Introduction. ............................................................................ 1 A. Objectives 2 B. Infrastructure Development Activities Around the Nation 3 C. Representative State Experiences 4 Tennessee .4 New York and Michigan 5 Illinois 5 New Jersey 5 Summary of State Experiences 6 D. Telecommunications Industry Survey.......................................... 6 E. Current Status of the Telecommunications Network in Minnesota....... 7 Section II: Short Term Goals 11 A. Digital Switching and Digital Interoffice Facilities 12 B. Local Service Attributes....................................................... 17 1. Single Party Service 17 2. Touchtone Service 18 3. Custom Calling Features 19 4. Equal Access 20 Section III: Intermediate Goals 25 A. Signalling System 7 25 B. Integrated Services Digital Network (ISDN) 30 C. Custom Local Area Signalling Services (CLASS) 34 Section IV: Long Term Goals 39 A. Description of a Broadband Infrastructure.................................... 39 1. What is Broadband? 39 2. Components of a Broadband Infrastructure 41 a. Distribution Alternatives 41 b. Switching 48 c. Interoffice Facilities 49 d. Signalling 50 e. Customer Premises Equipment.. 50 3. Summary 50 B. Broadband Services/Applications............................................... 52 1. Current and Potential Services 52 2. Current and Potential Applications.................................... 53 C. Broadband Benefits 54 1. Customer Benefits of Broadband 54 2. Social Benefits of Broadband 60 3. Characteristics of Current and Future Demand 61 4. Broadband Costs and Risks 62 D. Participants (Competitors/Co-Providers) in the Building of a Broadband Infrastructure (Examples) 63 1. Telephone Companies 64 2. Cable Television Companies 65 3. Interexchange Carriers................................................... 66 4. Competitive Access Providers 66 5. Computing Networks 66 E. Broadband Infrastructure Deployment Scenarios 67 1. Scenarios for Broadband Deployment 68 a. Build It and They Will Come Scenario 68 b. Market Demand/Deployment Scenario 70 c. Industry/Public Joint Action Scenario 71 F. Wireless Infrastructure Deployment............................................ 73 G. Potential Regulatory Issues 77 Section V: Summary of Recommendations 79 Appendices 85-183 Appendix I: MTSG Members 85 Appendix II: MTSG Charter. 91 Appendix III: Bibliography. ... .... ........................................ 95 Appendix IV: MTSG Survey 99 Appendix V: Network Requirements 109 Appendix VI: CLASS Order 113 Appendix VII: Detailed Description of CLASS Features 131 Appendix VIII: SONET Graphics 137 Appendix IX: ATM Graphics 143 Appendix X: Education Graphics 157 Appendix XI: Cellular Coverage in Minnesota 165 Appendix XII: MTA and BTAs for Minnesota 169 Appendix XIII: Glossary.. .. .... .............. .......... .. ................ ...... 173 EXECUTIVE SUMMARY BACKGROUND - The Minnesota Telefutures Study Group (MTSG) was fonned in 1990 at the request of the Minnesota Public Utilities Commission (Commission). Its purpose was to describe the telecommunications infrastructure required to further enhance Minnesota's leadership in telecommunications beyond the year 2000 and to develop a comprehensive set of recommendations, including industry and government actions, required to further position the State's telecommunications industry to deliver the latest enhanced telecommunications services required by the citizens of Minnesota. The study group was composed of representatives from the telecommunications industry, state agencies, public interest and customer groups. The MTSG surveyed and analyzed the telecommunications infrastructure activities of some thirty other states, as well as industry initiatives and general infonnation and data on the subject. This report contains the [mdings of the MTSG and its recommendations to the Minnesota Public Utilities Commission. ACTIVITIES OF OTHER STATES The MTSG found several objectives that were consistent throughout the various state plans they reviewed, including digital switching and fiber optic transmission facilities; redefinition of universal service to include technological advancements; examination of regulatory policies and practices; utilization of telecommunications to deliver educational, medical and government services more efficiently; promotion of telecommuting; facilitation of economic development opportunities through business cost reductions via telecommunications; and preparation of a detailed inventory of the existing telecommunications infrastructure. The different approaches to infrastructure and alternative regulatory policies examined by the MTSG have been introduced into various jurisdictions in recent years. The MTSG believes that it is premature to conclude that any single approach provides superior results. INDUSTRY SURVEY/MINNESOTA NETWORK CURRENT STATUS To detennine the current status of the network and local exchange carriers' (LECs') future infrastructure plans, the MTSG surveyed all Minnesota LECs in late 1991. Respondents serve 96 percent of all Minnesota access lines. Alternative data sources were reviewed, and those companies serving the remaining four percent of access lines were contacted, to complete the survey. The survey addressed services that the MTSG believes are most important to the development of a modem telecommunications infrastructure, including planned investment in facilities and systems. The current telecommunications network in Minnesota consists of 94 local exchange companies, approximately 100 long distance companies, one local exchange competitor, and about 900 payphone companies. The local exchange carriers vary in size from 1. 8 million access lines in 122 exchanges to 36 access lines in one exchange. The quality of service of even the smallest local companies in Minnesota is among the best and 70 percent of the State's access lines are served by a digital switching vehicle. Currently, 89 percent of all trunking facilities in Minnesota carry digital transmission and over two-thirds of the interoffice facilities are fiber. ESTABLISHMENT OF MTSG GOALS The MTSG developed short term, intermediate and long term goals for the provision of specific facilities and services that it believes are essential for an advanced telecommunications infrastructure in Minnesota. Phased goals were adopted in order to establish workable and achievable target dates for the study group's recommendations. The short term goals include ubiquitous availability of the following by 1998: digitally switched access lines, digital interoffice facilities, single party service, touchtone calling, custom calling features, and interLATA equal access. The intermediate goals cover Signalling System 7 (SS7), Integrated Services Digital Network (ISDN) and Custom Local Area Signalling Services (CLASS). SS7 is the next generation of signalling, providing out-of-band signalling which allows for more signalling information, fraud reduction and the opportunity for new service offerings. ISDN is a digital architecture that allows for an integrated voice/data capability over the end user loop facility. CLASS is an enhanced offering of nine central office based services and is available in offices equipped to provide these services. The long term goal is deployment of a broadband network capable of supporting advanced services as dictated by market demand, competition, and technology development. Full evolution may take two decades due to evolving standards and technology. Current expected costs of deployment, excluding loop electronics, may range from $4,800 to $23,100 per access line. These goals, and the technologies they encompass, are described in detail in thisreport, as are the associated applications and benefits. Potential regulatory issues related to the long term goal are also discussed. RECOMMENDATIONS The MTSG unanimously adopted the following recommendations: Short Term • All exchanges must be served by digital switches by January 1, 1998. II All exchanges must be interconnected by digital interexchange facilities by January 1, 1998. ~ All providers of basic local service must offer single party lines to customers upon request by January 1, 1995. ~ All providers of basic local service must equip all lines with touchtone and provide touchtone to all subscribers without separate charge by January 1, 1995. All providers of basic local service must offer basic custom calling features to all subscribers by January 1, 1998. All subscribers should have access to multiple long distance providers on a presubscribed (l +) basis for interLATA calls by January 1, 1998. An intraLATA equal access recommendation was deferred pending the current docket before the Commission. Intermediate ~ SS? trunk signalling for call set up should be deployed ubiquitously throughout the State by the year 2000. Information on ISDN features and availability should be provided, with further deployment and penetration in the State left to customer demand and individual company offering. In extended area service (EAS) markets, where one of the exchanges obtains CLASS services, the exchanges with EAS to that exchange should also obtain CLASS services within three