Wednesday, June 30, 1999 Published at 20:55 GMT 21:55 UK
Boost to Europe's Internet backbone
Phase One of the i-21 network is in red, Phase Two in blue
By Internet Correspondent Chris Nuttall
Plans for Europe's largest-ever data network have been unveiled, promising faster and cheaper Internet access.
The UK's Interoute Telecommunications has announced the world's first 'petabit' network - capable of carrying 1,000 trillion bits per second of data traffic.
The i-21 network (Internet 21st Century) will link 17 countries and 70 cities, have 200 Points of Presence, measure 20,900km long and use over 8m kilometres of the latest generation G655 optical fibre.
France's Alcatel has been awarded a $1.5bn contract to build the network and America's Corning Glass will provide the fibre-optic cable. The new fibre allows more power to be pumped into it, meaning longer distances between amplifiers and more bandwidth for less cost.
The scheme is being privately financed by the Swiss-owned Sandoz Foundation.
Savings for users
The savings should be passed on to businesses and the consumer. "We really believe in [i-21's] premise that if they drop the price of bandwidth enough, it will unlock a tremendous amount of latent demand," Wendell Weeks, an Executive Vice President of Corning told a London news conference for the launch.
Interoute chairman Ohad Finkelstein said its vision was to create a new era of telecommunications in Europe of virtually unlimited bandwidth. "We're going to break the (state-owned telephone company) monopoly on price and availability of bandwidth," he said.
Interoute's founder John Mittens said they expected the UK telecoms regulator Oftel to make recommendations shortly on how the copper phone wires that still link most homes and businesses to the local exchange can use new technology to provide high-bandwidth services such as Video on demand and fast Net access.
The new system, called DSL, would allow downloading speeds of a million bps, compared to current home Internet connections at 56,000 bps.
Highd demand for the digital subscriber lines (DSL) would put a strain on existing backbone networks, but i-21 sees itself as stepping into the breach.
i-21 points out that bandwidth prices in Europe are up to 10 times more expensive than in the US with a 2 million bps leased line from Madrid to Brussels costing $45 per kilometre compared to one costing just $5 per kilometre between Boston and New York.
Strong competition to build networks
Construction of the network, in two phases, has already started. It should be partly operational by May 2000 with 90% of planned coverage available by the end of 2000.
"They could steal a lead, although there will be some networks in place before them," Stewart Anderton of the Ovum consultancy told BBC News Online.
"At the moment there are 14 or 15 different organisations who have declared plans for some kind of pan-European network," he said.
Ovum researched the market for BT, which launched its own Europe-wide network in April. Other players include Cable & Wireless, Esprit Telecom (GTS), France Telecom/Deutsche Telekom (Global One), Global Crossing, MCI WorldCom, and Telefonica.
"Some are building their networks by putting fibre in the ground and then buying bandwidth off companies like Interoute. BT will probably be self-reliant and could be selling capacity to other organisations," said Ovum's Anderton.
"When are you going to be profitable? is a key question. If i-21 have private funding then they are in a strong position.
"The demand will certainly be there, there is this constipation of the telecoms industry and frustration with the price of bandwidth," he said.
i-21 predicts deregulation in Europe will trigger an explosion in demand for bandwidth, as will the introduction of applications and services that are bandwidth-hungry such as Internet telephony and streaming video.