Call it the "broadband bustle." No, it’s not the latest dance craze. Rather, it’s the latest bandwagon being rolled out in the world of voice and data communications under the label bundled services. And the number of disciples chanting the bundled services mantra is growing.

What’s happening in the increasingly competitive telecommunications industry is that service providers — from local telephone companies to long distance carriers to cable television behemoths to software manufacturers — are using high-speed, broadband Internet access as the core around which voice as well as a data and network services are being bundled.

For a business, that can make for a tidy package that comes with a single bill. Or if not a single bill, certainly fewer bills.

So, before placing the order for that broadband Internet connection, business owners should assess all of their telecommunications and computing needs, as well as projected growth, and factor them into the equation.

Bundled services is the mantra of Dale Stein, the general manager of Pac-West Telecomm's San Diego/Orange County/Los Angeles region and president of INET, a wholly-owned Pac-West subsidiary. As you would expect, Pac-West is in the business of bundling services.

Bundling means one company, one bill and one phone, says Pac-West Telecomm's Dale Stein. (photo/lambertphoto.com)

Stein contends that the total cost of various telecommunications services — telephone, fax, broadband Internet access, telecommuting, video conferencing, interoffice networks, and specialized software — can be reduced significantly if some or all of them are obtained, if not from a single provider, at least fewer providers. It allows a business to do "one-stop shopping" and reduce the overall costs of these services.

It also can improve service and technical support, he says, because when dealing with several suppliers, they each tend to point their fingers at the other guys when something goes wrong. "The frustration that the customer has is, who is going to take care of my problem?" he says.

"So we have companies saying, 'I’m the ISP, I’m the ASP, I’ll provide your Internet access, I’ll provide your local trunks, I’ll provide your phone system, I’ll provide your computer network,'" Stein explains. "Instead of dealing with seven companies, you deal with one company, you get one bill, one phone, and your service is no longer, 'he-said, they-said, we-said.'"

Stein is not alone. There are at least a half-dozen companies offering variations on the theme in San Diego. Among them are Cox Communications, Pacific Bell and parent SBC Communications, Titan Telecommunications, Winstar Communications, and the most recent entry, Sprint, which last month introduced its Sprint ION service in San Diego. AT&T's fixed wireless unit is expected to join the fray this month.

"San Diego is one of the most ripe technical markets in the country for providing broadband Internet access," says Dan Gutwein, regional vice president and general manager for Winstar Communications Inc. "This is good news for customers because it leads to extremely competitive pricing."

Let's Make A Deal

Indeed, the competitors are playing "let's make a package deal." And these deals are bundled services, some including free Internet access, others a limited amount of free long-distance service.

Winstar, a New York-based broadband services company with an office in San Diego, operates what is known as a fixed wireless system. Voice and data signals are sent back and forth between its central office Downtown and other Downtown buildings via high-frequency wireless transmissions from roof-top, dish-like antennas. Winstar will extend its operation into Mission Valley later this month, and to Sorrento Mesa and the Del Mar area either later this year or next year.

But Gutwein cautions business owners to understand the distinctions between the various offerings. Bundled services comes in a variety of flavors. The services offered will vary, with some companies providing only voice lines and broadband Internet access, while others, such as Winstar, Pacific Bell/SBC and Pac-West, will provide a full range of services, including complete telephone systems and systems integration, as well as a broad menu of Internet services.

In addition, both Winstar and Pac-West are also ASPs (application service providers, offering access to Web-based software programs. Winstar owns and operates office.com, and will soon offer Web-based versions of Microsoft Exchange and Office software. Both companies also offer server co-location services.

But even with the potential cost reduction, many business owners are slow to jump on the bundled services bandwagon, says Christopher Bucci, president and founder of Titan Communications, headquartered in Mission Valley.

One Bill, Please!

One of the biggest barriers, not just for his company, but any company offering bundled services, Bucci says, is resistance to change. "When I talk to people in the business community, they say, 'A new business will be comfortable with this, because it’s not entrenched, but an existing business will see difficulty in change.'

"But there is no difficulty," he argues. "When you sign an agreement for a company to provide this level of services, it’s all done for you. And now instead of your accountant trying to figure out a long distance bill, a Web-hosting package bill, domain-registration bill, and DSL bill, you've got one. From an accounting standpoint, it’s phenomenal. One invoice, one check, and it’s cheaper."

Bucci describes Titan, which operates nationwide, as a services integrator. It bundles the services of several vendors, including DSL from Covad and long-distance from Frontier Communications, so the customer only deals with one provider and one bill.

And having a single bill is one of the most oft-heard requests, say the representatives of all these companies. Customers want consolidated billing in a format that’s easy to understand.

Titan does not offer local dialtone, however. That service would still have to come from Pacific Bell — and be billed separately — Bucci acknowledges.

But PB has its own package of bundled services, the difference being that it’s prohibited from offering long distance — at least for now. Parent company SBC began offering long-distance service in Texas last month and hopes to be offering it in California by early to mid 2001.

"The strategy we are pursuing is to have a fully integrated solution," says Joe Simone, vice president of marketing for Pacific Bell. "In our minds, though, packaging and integration goes further than the traditional telephone service and basic Internet access."

To that end, Pacific Bell is moving toward full ISP and ASP offerings to support e-commerce through expanded Web hosting options, and by offering a variety of business services online, Simone explains. And through SBC's Datacom unit, the phone company provides network integration services, he adds.

However, there are break points below which some of these packages are not cost effective. For example, the Pac-West program is most effective for businesses with a combination of 15 phone/fax lines or more. Winstar says its package has a break point of three to five phone/fax lines. Cox Cable, on the other hand, says its bundled service is cost effective with even a single phone line.

"We provide services everywhere from SOHO (small office/home office) to serving our corporate business needs for Cox in San Diego — voice, data and video for business customers," says John Altamura, Cox regional vice president. "We are definitely competitive (in terms of phone service). We target our prices to be about 10 percent below the local phone company."

Altamura cautions that the small or home-based business must realize it gets what it pays for. "The reality is, they have a choice to make," he explains. "Do they want a residential product to run their business from, or do they want a business product, which is a higher level of service guarantee and commitment?"

Cox does not serve the entire county, however, and cable-based services may be unavailable in some commercial buildings and business parks. Time Warner/Road Runner does not currently offer phone service, but will be entering the arena in the not-too-distant future.

What works best for any given business depends on its specific requirements, projected growth and geographical location. Some service options will be limited or unavailable in outlying and rural areas.

Unfortunately, most of the services are not directly comparable, making analysis difficult. Some offer a combination of telephone/fax, Internet access and e-mail accounts. Others offer a longer menu of services, including Web site hosting, online software applications, phone systems, network installation and systems integration. Before contracting for any of these services, you need to determine how much bang you’re getting for each buck you’re spending

Bottom Line

Bundling telecommunications services under one supplier — or at least fewer suppliers — may not only reduce overall costs, but service and accounting headaches as well. You would be wise to at least investigate what’s available, get out your green eyeshade, and do a little number crunching. (And make sure you get details on all the costs, including set-up and installation fees.)

Larry M Edwards is a new-media consultant and the author of the Official Netscape Internet Business Starter Kit. He may be reached online at: larry@larryedwards.com and www.larryedwards.com.