Prepared by:
Mark Brose
for the Carlson School of Management
Submitted: 3 Jun 1996
Posted on the WWW: 26 Oct 1996
East Otter Tail Telephone Company needs to replace 30-year-old, deteriorating air-core copper cable in its low population density rural network. Rather than spend $3,000 per customer to dig new copper, the company is trying to bring costs down to the $5,000 per customer necessary for it to break even in the deployment of a fiber-to-the-home (FTTH) network.
To find out if this can be done, the company is conducting a field trial in the summer of 1996. The field trial is being conducted for 94 of its approximately 16,000 phone customers in an area with a population density of 2 persons or less. The field trial will allow the company to test whether the FTTH as designed will deliver analog telephone, data (Internet) and cable services of equal or better quality relative to what exists today. Since the FTTH network has not been tested before, it is difficult to determine until after the field trial is operational whether it will deliver acceptable services. The design does meet East Otter Tail's criteria of replacing its old copper cable with a transmission medium that has a longer future, while keeping costs to a reasonable level. Costs in the field trial are about $7,500 per customer, but the company has already identified ways to bring them down to $5,500. It is hopeful that equipment costs will come down enough before the final roll out to meet its $5,000 per customer goal. Also, the company is working with a consultant which has long-term experience in working with fiber optic installations in rural Minnesota. The consultant is familiar with the territory and the conditions of the rural telephone companies, increasing the likelihood that the network will be made operational.
The main weakness of the FTTH network as designed is the fact that transmission remains analog, requiring additional investment in technology that will soon be out-of-date, in addition to the fact that the network will deliver lower quality service with fewer features than a digital network. It is possible; however, that by the time East Otter Tail rolls out the network to the rest of its rural service area, the equipment costs will have come down enough and availability increased enough to go all digital right away, at least for voice and data services.
It appears that the only government assistance East Otter Tail will need in deploying the FTTH is a low-interest Rural Utilities Service (RUS) loan. Even this government assistance may not be necessary if the costs of equipment come down enough, allowing the company to afford a private loan. However, it would be to the benefit of the company and local government, businesses and residents if East Otter Tail made an effort to collaborate more broadly in the design and implementation of the FTTH network. It is possible, that in this collaboration demand could be more accurately assessed and pooled so that the network is scaled properly and perhaps digital broadband services could be offered immediately.
TABLES AND FIGURES
In this paper I examine East Otter Tail Telephone Company's deployment of "fiber-to-the-home" (FTTH) in rural Minnesota. The company is currently conducting a field trial in which it is installing fiber optic cable from the central office to 94 homes in areas with subscriber densities of 2 per square mile or less. The goal of the field trial is to determine which technologies to use and whether it is economical to deploy fiber in the company's rural service area. The company hopes that by offering multiple services over the fiber, including telephony and cable television, this will be possible.
This case provides an innovative example of how to bring what is often touted as the highest quality transmission medium of the (near) future directly to the residences of rural customers, potentially without the need for large public subsidies or government intervention. While it is true that the exact conditions of the Otter Tail case exist everywhere, conditions may be similar enough so that it serves as a model for other small phone companies in Minnesota.
In the paper I will focus on six primary topics: the East Otter Tail Telephone Company's business, including services offered; the terrain and demographics in the service territory; the technology, including the impetus for the new technology, a description of the field trial and the technology deployed, costs, strengths and weaknesses of the network, evaluation, plans for future implementation and alternatives considered; and finally the policy issues, including Universal Service, Rural Utilities Service, national and state infrastructure development goals and the role of government..
The East Otter Tail Telephone Company sells telephone, data (Internet), cable television (CATV) and Direct Broadcast Satellite (DBS) services and has recently obtained a license to offer Personal Communications Services (PCS) (see Appendix for a description of DBS and PCS). This paper is concerned primarily with wireline technologies used to deliver telephone, data (Internet) and cable television services.
| Service | # Customers* |
| Telephone | 16,000 |
| Internet | 500 |
| CATV | 15,000 |
| DBS | 1,000 |
*Numbers are approximate.
East Otter Tail currently services approximately 16,000 telephone subscribers, 85% of whom are residential. About 20% of the customers subscribe to one of two seasonal plans. The six month minimum plan is new and has the fewest users. In this plan, customers keep their telephone number from year to year, but are disconnected in the fall and pay to get reconnected in the spring. The nine month plan has customers partially disabled for 3 months, meaning they cannot make or receive most calls, but they can still dial 911 (emergency number) and 511 (access to the business office for questions about service and billing).
(Source: CC&I Engineering, Inc.)
(Source: CC&I Engineering, Inc.)
East Otter Tail Telephone Company serves a total of twelve telephone exchanges:
Three digital switches and 29 remote switches serve the 12 exchanges. The company owns approximately 2,800 route miles of copper cable of various sizes from 1 to 1200 pairs and about 350 route miles of fiber cable. Signaling System Seven (SS7) is used for most of its trunk routes. The company plans to offer Integrated Services Digital Network (ISDN) in late 1997 (see Appendix for a description of ISDN).
East Otter Tail is an Internet Service Provider (ISP) and currently has 500 Internet subscribers, which are a subset of its telephone subscribers.
The company has approximately 15,000 cable subscribers. The region it serves for cable is slightly different than the phone territory. Currently East Otter Tail doesn't serve customers when the population density is less than 10 persons per square mile unless the customers are willing to help pay the setup cost. The company has about 90% penetration in the areas it serves. This high rate of penetration is a result of the poor reception of current analog satellite broadcast television in the region. Most of its cable customers are only able to receive one channel of marginal quality via current satellite broadcast. Most of the coaxial cable currently used for cable is underground.
East Otter Tail's telephone service territory is non-contiguous (See Figures 1 & 2) and crosses five counties: Becker, Cass, Hubbard, Otter Tail and Todd. It is bounded on the north by the White Earth (NW) and Leech Lake (NE) Indian Reservations. Like much of the rest of the state, the area contains several lakes and rivers (See Figure 3).
Compared to the rest of the state, East Otter Tail's region has a relatively low population density, but by no means the lowest (See Table 2). The population densities of the counties in which East Otter Tail offers service range between 11 (Cass) and 26 (Otter Tail). These are well below the state average of 55, but significantly higher than Cook County's density of 3 persons per square mile. Table 3 shows housing data for Otter Tail County.
| Population | Sq. Mile | Pop Density | Name |
| 27,881 | 1,311 | 21 | Becker |
| 21,791 | 2,018 | 11 | Cass |
| 14,939 | 923 | 16 | Hubbard |
| 50,714 | 1,980 | 26 | Otter Tail |
| 23,363 | 942 | 25 | Todd |
| 4,375,099 | 79,617 | 55 | Minnesota |
| 1,032,431 | 557 | 1,855 | Hennepin |
| 3,868 | 1,451 | 3 | Cook |
(Source: U.S. Census Bureau, 1990)
| Total resident population (1992) | 51,362 |
| Per square mile | 26 |
| Housing (1990) | |
| Total units | 29,295 |
| Occupied units/households | 19,510 |
| Persons per household | 2.53 |
| Percent owner occupied | 78 |
| Median Value (dollars) | 46,600 |
(Source: U.S. Census Bureau)
(Source: U.S. Census Bureau Tiger Mapping Service)
East Otter Tail needs to replace its copper telephone lines, which are 30-year-old "air core" lines that are beginning experience water damage. Based on current technological trends toward more advanced services such as high speed data networking and video, it appears that copper cable will have a limited future. The company prefers to install a transmission medium that will be able to deliver advanced services in the future while keeping costs to a reasonable level today.
The field trial is being conducted in the company's New York Mills exchange. It consists of 94 customers in an area which has a population density of 2 persons per square mile or less. The fiber for the field trial was dug by East Otter Tail in October 1995. Installation of the rest of the system was slowed by subzero winter temperatures and the first three homes were first made operational in March 1996. One customer was setup with voice, data and video and the other two were setup with video only. According to one of the equipment vendors, Optical Solutions, there has been only one problem so far with caller identification. The problem has been fixed and now all custom calling features are enabled in the system. The entire field trial will be up-and-running for the open house in the first week of June, 1996.
East Otter Tail is working with an engineering consulting firm in Fargo, ND, Communications Consultants, Inc. and a fiber optics system integrator in Bemidji, MN, Optical Solutions, Inc. to design and implement the field trial. The field trial has been approved by the Rural Utilities Service (RUS) and meets the State Telecommunications Modernization Plan (STMP) guidelines as required by RUS (See the section on RUS later in this paper for more information).
East Otter Tail's fiber-to-the-home (FTTH) network delivers plain old telephone (POTS), low speed data (28.8) and cable television services over fiber optic cable all the way from the central office to the customer premises. The network is primarily analog at this time, with the exception of the digital loop for telephony from the central office to the node (See Figures 4 and 5 for diagrams of the network).
The primary network components are a Central Office Terminal (COT) and Cable Television Head End (HE), an Optical Network Unit (ONU), a Fiber Distribution Point (FDP), and a Universal Demarcation Point (UDP). The main telephone switch and the video receiving point are located at the COT/HE. The network consists of two ONUs which contain a broadband receiver (RX-6000) that accepts the video signal from the COT, amplifies it and directs it to three (maximum six) radio frequency (RF) transmitters. The three transmitters modulate and send out the signals to up to 16 customers each for a total of 48 per node (maximum 96). Initially 36 cable television channels will be transmitted in the 55-300 Megahertz range. The system has the potential to transmit up to the 750 MHZ level and offer 85 channels.
The Optical Network Unit (ONU) also contains an analog device (SLI-96: Subscriber Line Interace/96 subscribers) which interfaces the voice circuit from the digital loop carrier (DLC) with the optical network to and from the customer premises. The system supports up to 96 subscribers in the 40-50 Megahertz spectrum. Each of 24 modules interfaces four subscribers with corresponding DLC cards. The signal is then modulated from the DLC card to an RF carrier and combined for delivery to the subscribers. On the upstream path the optical transmissions are detected, converted and interfaced back to the DLC and multiplexed for transmission to the COT. In the future, this component will be deployed directly from the COT, eliminating the need for digital loop carrier equipment altogether. The Fiber Distribution Point (FDP) is a splice point which reduces the fiber count between the ONU and the UDP.
All information is processed at the customer premises by the Universal Demarcation Points (UDPs). The UDP contains a receiver, transmitter, power supply, fiber management area, network interface panel and subscriber interface panel (coaxial and RJ11). The UDP is responsible for detecting and distributing the voice, data and video signals to the customer premises equipment (phone, computer, television). Up to three voice lines are supported. The UDPs are powered locally at the subscriber premises, although they have been setup to be powered before the meter base and East Otter Tail will bear this cost. In other networks of this type, the UDPs are network powered.
The network architecture is passive optical (PON) using single-mode cable and laser transmission. It is non-blocking, employing a "band pass filter" which uses dedicated frequencies in each direction. The design is modular in that components for new service can be added/changed easily at the ONU and UD. Each node (ONU) covers a service area of approximately 3 ½ miles (1,800 feet). The network is designed to keep the distance at or below three miles to eliminate the need for repeaters.
Omitted due to size.
The estimated total cost of the field trial is approximately $750,000, including expenses for outside plant, digital loop carrier, field trial equipment and fiber optic cable. With almost 100 customers in the field trial, the cost per customer is approximately $7,500. East Otter Tail has already identified ways to bring costs down to $5,500 per customer. To break even, the company estimates the cost would need to come down to $5,000 per customer. Based on past trends, the company is hopeful that equipment costs will come down even further before they roll this out to other service areas. For comparison, East Otter Tail estimates it currently costs $3,000 per customer for the copper facility.
There are several strengths to the network as designed. The strengths of the network result primarily from the integration of service delivery over one transmission medium and the positive characteristics of that medium-fiber optic cable:
The weaknesses of the network as designed are few, but significant. The main weaknesses stem from the fact that the network remains analog:
Evaluation of the field trial will be strictly performance based. East Otter Tail is testing to determine if services can be provided with the same or better quality as compared to conventional copper delivery. The contract prices are set so the company will not be able to cut costs for this project. East Otter Tail hopes to be able to learn new methods and techniques that will enable it to reduce the costs for future roll out.
Since the East Otter Tail field trial is in it's initial stages and is not fully operational as of this writing, it is difficult to accurately assess the success/failure of the FTTH network as designed. There are currently at least two other similar FTTH networks in rural areas for comparison, but they are also in the very early stages of operation. Rural Telephone Service Company of Lenora, Kansas, has been operating a video only FTTH network with Optical Solutions equipment since December 21, 1995. According to Optical Solutions, as of March 1996 there have not been any maintenance, service or reliability problems reported. Federated Telephone Company in Chokia, Minnesota, is just now completing installation of its FTTH network and no results are available at this time.
Despite the lack of field tested results from this exact network design and components, a few comments can be made as to its prospects for success and applicability to East Otter Tail's market. The design accomplishes the objectives of East Otter Tail in that it allows the company to install a transmission medium that will be useful in the future, while keeping costs to a reasonable level today. Fiber optic cable is being installed and it appears that the costs of network components will come down enough by the roll out for East Otter Tail to reach the break even point. The main problem with the network as designed is that it is analog. East Otter Tail may be throwing away money in analog equipment. This is a risk averse approach in the sense that it keeps investment costs down while demand for more advanced services is still unclear. This approach may be sensible if the company can recover its investment before switching to digital. It may also make sense because the digital components are not completely mature and still quite expensive. Waiting for product maturity and price decreases may allow for a more stable and less expensive network in the future. On the other hand, with limited funds available for investment, the implementation of an analog network may leave East Otter Tail's subscribers with limited services as it waits to recover its cost of investment.
Another positive is that East Otter Tail are working with a local company, Optical Solutions, whose president has long-term experience in working with fiber optic installations in rural Minnesota and is familiar with the territory and the conditions of the rural telephone companies. Optical Solutions has designed its products and the network and products around this experience.
Assuming the field trial is successful, the decision to implement the technology in the rest of the company's service area will be a matter of economics and demand for services. The primary emphasis will be on rural areas where the cost per serving a single customer is already high. In the city at least for now, the options for coaxial cable are better for broadband services
.For telephone service, the company will consider digital as it rolls the network out further, but may only upgrade customers with special needs, such as ISDN. For Broadband services such as CATV, digital transmission will not be used unless the entire CATV system moves to digital components.
East Otter Tail considered deploying switched digital video (SDV), but found that the initial costs were extremely high and the technology did not deliver network broadcasts effectively. The company also considered standard copper distribution with either copper or fiber feeder cables. Fiber feeder with copper distribution was found to be the least expensive, provides some feature enhancements over all copper, and is the standard in the industry in the company's region today. Copper distribution cannot; however, deliver broadband services over the distances needed in East Otter Tail's sparsely populated rural areas. East Otter Tail also considered hybrid fiber coax, but the costs were higher, and the reliability was lower.
In looking at going all digital right away, East Otter Tail encountered several obstacles in the CATV arena. The company stated that the set top boxes required for digital cable are themselves not prohibitively high cost, but the low volume purchase makes them high priced and thus the initial startup cost is very high. The startup cost for common equipment at the headend to receive a digital signal or to actually encode the signal from analog to digital is also expensive when used for a small number of customers. The products necessary to be fully digital are not generally available right now. Some programming may be available in a digitized form, but the cost to convert real-time video to compressed digital is very expensive.
East Otter Tail contributes to but does not currently receive any Universal Service Fund support because its average cost does not exceed the national average by more than 115%. This is not likely to change as a result of the current Federal Communications Commission (FCC) Rulemaking being conducted as required by the 1996 Telecommunications Act.
East Otter Tail has applied for a Rural Utilities Service (RUS) loan, but the interest rate and other terms have not been released yet, and won't be until the loan is approved. It takes several months for RUS funding approval to come through.
The RUS lending program attempts to create public-private partnerships to finance the construction of telecommunications infrastructure in rural areas. The program assumes that rural telecommunications is more capital intensive and that government assistance is necessary to ensure investment. The average borrower has between four and six subscribers per square mile. Loans are made to companies providing telephone service in rural areas. Among other requirements, all RUS borrowers must bill their urban and rural phone customers at the same base rate. As an RUS borrower, East Otter Tail is already in compliance with this requirement.
East Otter Tail's trial has been granted official field trial status by RUS. This is required for all equipment to be funded by an RUS loan not on the approved "List of Materials".
For all loans to be approved after February 1996, RUS requires that a borrower participate in an RUS approved State Telecommunications Modernization Plan (STMP). The intent behind this requirement is to ensure that advanced telecommunications servicess are brought to rural areas at the same time as urban areas. In reality, the requirements were somewhat watered down from their original intent. The intent was for the plan to be developed by the State Public Utilities Commission (PUC). The RUS suggested (but did not require) that the plan include all service areas of all telecommunications operators (wireline and wireless) in the state. In Minnesota, the PUC opted not to develop a plan, which by RUS requirement then left the development of the STMP to a majority of RUS borrowers. The RUS clearly states that in this case the STMP may only apply to RUS borrowers. Thus, the coordinated deployment of services in urban and rural areas will only occur in the urban and rural areas served by RUS borrowers, and will not take place in the State as a whole as a result of the STMP.
Nevertheless, the RUS borrower must hold to the requirements of the plan for their service areas. The requirements are broken down into short- and medium-term categories. The Minnesota STMP simply restates the requirements, almost verbatim, in its plan:
The RUS also recommends, but does not require, that the RUS borrowers adopt long-term goals.
The Minnesota STMP includes the following goal statement:
This Plan shall include the elimination of party line service and the provision of state-of-the-art special features provided by digital switching and fiber optic facilities utilizing SS7 interexchange signaling protocol or its successor's system. This Plan includes the goal of providing digital voice and data services, and other services that provide transmission and reception of high bit rate (no less that 1 Mbps) data and the reception of video (as per the NTSC or Motion Picture Experts Group MPEG-1 or -2), for customers who desire these services.
The FTTH network as designed will already meet all of the short-term and long-term goals. The FTTH network as currently designed does not; however, address
the long-term goal of digital voice and data services.
Current Federal and State government and government/industry collaborative documents that outline goals for developing the information infrastructure generally focus on increasing the availability of "advanced services". While there is no agreed upon definition of this term, it generally implies moving beyond POTS initially to higher speed narrowband services (e.g. BRI-ISDN), ultimately in the direction of two-way broadband services. Narrowband and broadband in this sense are defined non-technically without respect to transmission medium or technologies in terms of transmission rates (see Table 4).
Transmission Rate | Engineering Term | Non-technical Term |
16 Kbps |
| Narrowband |
|
| Wideband |
|
| Broadband |
(Source: Minnesota Telefutures Study Group, p. 39)
A bill proposed by Minnesota State Representative Kelley (D), for example, called for ubiquitous: local dial-up Internet access by December 31, 1998;
BRI-ISDN (128 kbps) or equivalent service by December 31, 2000; and T-1 (1.54 Mbps) level service by December 31, 2005. Federal and State documents
also focus on ensuring that these services are offered in rural and high-cost areas, as well as schools, libraries and health care providers.
While the FTTH network as designed today offers telephone and data (Internet) services only in the narrowband range and one-way video in the broadband rage, because of the deployment of fiber optic cable in the network the bandwidth will be available for delivery of two-way broadband services in the future. Thus the East Otter Tail FTTH network has the potential to evolve in line with national and state infrastructure goals as it transitions in the offering of narrowband to broadband services in the rural setting.
Without RUS support, East Otter Tail says it would be unlikely to proceed with further implementation of the FTTH network. If costs come down as hoped; however, it might be possible for the company to continue implementation with private loan money. It appears for the time being that the most East Otter Tail would require from the government to implement the network is a low-interest RUS loan. Other Federal or State assistance is not necessary for further deployment. It is unclear whether this will change as competition begins to enter the market. However, there are several factors that make it unlikely that East Otter Tail will see significant competition, at least in the near term: its market is relatively small; it offers both wireline and wireless services (DBS and soon PCS); and Regional Bell Operating Companies (RBOCs), one large potential market entrant, are selling off their rural exchanges rather than trying to enter new rural markets because they do not tend to be lucrative. The one potential competitor in the near term would probably come from cellular (see Appendix for a description of cellular).
Generally, government agencies have called for intervention in rural areas. The (now defunct) Office of Technology Assessment (OTA), for example, in a 1994 report, makes a case for the concurrent economic and telecommunications infrastructure development strategies that involve the cooperation of rural institutions (development agencies, schools, libraries, and health care providers), telecommunication companies and "catalysts for change" (government, private entrepreneurs, universities and colleges, and local leaders).
The OTA argues in this report that with the increasing importance of communications and information in society and the likelihood that only one telecommunications network is economically feasible in a rural area, it is critical that all stakeholders cooperate in developing the appropriate network for the community. An holistic approach that integrates technology and economic development would offer new ways for rural communities to achieve economies of scale and scope and in this way economically justify the deployment of advanced technologies. It is extremely important that this occur in a one network situation, since extensive capital for network upgrades is generally not readily available in rural communities and government resources are limited with national budget concerns and competing demands for funds.
The OTA argues further that rural areas are generally not aware of the potential of telecommunications technologies and that government needs to give technical assistance and education to users to "familiarize them with communication technology and assist them in planning and devising communications based development strategies" (OTA, p. 16).
The OTA also makes an argument against what it calls an "evolutionary approach to network modernization." Instead, rural areas should pool users (business, government, etc.) to offer broadband technologies right away, since "broadband technology is optimally designed for sharing." The OTA goes on to say that this kind of pooling will not result as a mere extension of narrowband technology and that upgrading will be costly if the need is established at a future date. Pooling users, especially in advance of the network design and implementation, may also be beneficial to the telecommunications provider, since by working with the consumers the company may be able to obtain commitments to purchase services, thus overcoming some of the risks associated with demand uncertainty.
This is consistent with at least one Minnesota Legislator's plans. Recently, a Minnesota Legislative Analyst posted a message to a telecommunications Internet listserv requesting assistance in developing:
legislation for the creation of consumer cooperatives, to aggregate and leverage the purchasing power of residential and small business utility consumers. The intent of these cooperatives would be both to decrease rates and to increase access to advanced services for these consumers. This legislator would like the cooperatives to be operative and effective in both the telecommunications and energy industries.
Although it can be shown that both consumers and providers of telecommunications services can benefit from collaborative planning, the OTA is perhaps overly optimistic in the ability/desire of local stakeholders to participate in such a process. This may happen, as it has in Winona, but the conditions or needs for such projects do not necessarily exist in all areas. The OTA approach may not apply when the network is primarily connecting residential areas, for example, as it is in this case. Thus it is desirable that the network design and implementation occur to the extent possible with an eye toward supporting local economic development and participation. However, in this case it may not be feasible or necessary.
In its rural service area, East Otter Tail Telephone Company's fiber-to-the-home (FTTH) network as designed will replace deteriorating copper cable with high bandwidth fiber optic cable at a relatively reasonable cost. The network is made economically viable by initially using analog transmission (lower startup equipment cost) and combining delivery of telephone, data (Internet) and cable television services over one transmission medium (fiber). Keeping the network analog has the downside of requiring additional investment in technology that will soon be out-of-date, in addition to the fact that it delivers lower quality service and fewer features. By deploying fiber optic cable; however, the bandwidth is in place in the network for the delivery of high speed services in the future.
Since the technology and design of East Otter Tail's FTTH network have not been tested before, it is not yet clear if the network will operate acceptably. This will first be known after the field trial is conducted this summer (1996). However, the design does meet East Otter Tail's criteria of replacing its old copper cable with a transmission medium that has a longer future, while keeping costs to a reasonable level. Also, the company is working with a consultant which has long-term experience in working with fiber optic installations in rural Minnesota and is familiar with the territory and the conditions of the rural telephone companies. This increases the likelihood that the network will be made operational.
It appears at the moment that the only assistance East Otter Tail will need from the government to roll out the FTTH network is a low interest Rural Utilities Service (RUS) loan. It is possible; however, that if costs come down the network could be rolled out with a private loan. It may also be the case that by the time East Otter Tail is ready to implement the network after the field trial, the cost and availability of the equipment required to go digital, at least for voice and data services, will have changed enough to allow the company to deploy digital right away. It may also make sense, as the Office of Technology Assessment (OTA) recommended in its 1995 report, for the company to work with local government, businesses, and residents to try to pool demand and assist in the move toward digital broadband services immediately.
ISDN is a service which provides for the distribution of voice, video, audio and data over the end user loop facility (between the home/office and the telco). It makes use of the public switched telephone network (PSTN) with two standard methods of end user service: a basic rate interface (BRI) and a primary rate interface (PRI) which conform to internationally developed standards. The BRI has two 64 kbps bearer (B) channels and one 16 kbps data (D) channel (2B+D) and allows for up to 144 kbps transmission speeds. In the U.S. the PRI has a capacity of 1.544 Mbps and has twenty-three 64 kbps B and one 64 kbps D channels (23B+D). The B channels carry the circuit switched and packet data information (voice or data) and the D channel handles signaling information (Simplex 1996 and Minnesota Telefutures Study Group 1993, 30-31).
2B + D, up to 144 kbps transmission rates.
23B + D, up to 1.544 Mbps transmission rates.
Diagram Source: Stallings 1995, 299.
DBS is a type of radio communication service in which signals transmitted or retransmitted by satellites are intended for direct reception by the general public. The key distinction between DBS and the direct-to-home broadcast television that existed previously, is the ability of the satellites to transmit with much higher power. This allows for the use of much smaller and lower-cost receiving antennas. This has led to the increasing popularity of this service in the home, especially in rural areas where broadcast reception is poor to non-existent and cable is not available (NTIA Pub 95-33 1995; 4-57, 59, 63).
The cellular system is designed to provide wireless phone and low speed data services in limited spectrum space. This is accomplished by breaking up geographic areas into smaller areas called cells. After a certain distance (approximately 4-6 times the cell radius), the cell frequencies can be reused, giving the cellular system a large capacity, despite the limited spectrum space available. Low power transmitters provide coverage within each cell. The cells are designed to be hexagonally shaped with no gaps of coverage between the cells (true in theory but not always in practice). As subscribers move between cells, calls are "handed-off" to the next radio link. Cell sizes typically range from 0.5 to 10 miles in radius, depending on factors such as landscape and population density.
Components of the system are the mobile telephone switching office (MTSO), cell site base stations, and mobile units. The MTSO (displayed in the center cell) is the central office for the entire cellular system, taking care of call processing and billing, and provides the link to the public switched telephone network (PSTN). The base stations (displayed as "Radio tower" in each cell) provide the radio link to the mobile subscribers. The subscribers generally own or lease their own "mobile units", usually phones (NTIA Pub 95-33 1995, 4-25 - 4-26).
Source: NTIA Pub 95-33, 4-26.
Personal Communication Services (PCS) is a technology similar to cellular, but with a few key differences:
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