From: johnl@iecc.cambridge.ma.us (John R. Levine)
Newsgroups: comp.dcom.telecom
Subject: Re: AT&T SDN; New Calling Cards
Date: 23 Aug 92 19:19:50 GMT
Organization: I.E.C.C.
X-Submissions-To: telecom@eecs.nwu.edu
X-Administrivia-To: telecom-request@eecs.nwu.edu
X-Telecom-Digest: Volume 12, Issue 657, Message 6 of 10

> Question: what does SDN stand for anyway?  And what makes it different
> from standard long distance service?

It's Software Defined Network.  In Olden Days when long distance rates
were much higher than now and switching was relatively much more
expensive than it is now, large companies usually rented lots of fixed
leased lines among their various facilities to carry intra-company
traffic.  This saved money relative to toll rates and also sometimes
avoided problems of not being able to get through at peak hours.

But now leased lines have become an anachronism, because the modern
network is much better at providing bandwidth on demand, so long
distance companies provide various billing hacks to give modern
equivalents of leased lines.  Once such hack is the "virtual private
line" which is a long distance ringdown circuit -- whenever you pick
up the phone at one end it quickly calls the other end to give you
pretty much the same effect as a leased line but at lower cost since
they don't need to provide bandwidth when you're not asking for it.
SDN is basically a bulk calling plan for large businesses that
replaces networks of leased lines.  One dials 10732 to make an SDN
call (and gets a message saying to call your account rep if it's not a
line assigned to an SDN account) but as far as I know the calls are
carried just like other AT&T calls.

Then there's the matter of Tariff 12.  AT&T, still being the dominant
long distance carrier, still has regulated rates which means that they
have to offer the same terms to everyone.  When dealing with large
customers, though, the only way a carrier can keep their business is
to create a package deal that meets their particular needs.  When AT&T
makes a package for a large customer, e.g. DEC, they file it as an
offering under Tariff 12 which means that if you happen to need
exactly the same service as DEC does, you can order it at the same
price.

But filing under Tariff 12 is expensive and slow so it doesn't make
sense to do it for other than the largest accounts.  To fill in this
gap, there has arisen a bunch of grey-market AT&T resellers.  There is
an SDN offering that covers multiple locations and sends each location
its own bill, but with a price based on the total volume, which many
companies use when each location handles its own overhead expenses.

The resellers buy this service and resell it to smaller businesses,
and AT&T then bills each of the smaller businesses directly.  I'm not
sure how the resellers make money, whether it's by charging a fee
directly to the customers or by somehow getting a rebate from AT&T.

AT&T doesn't seem to be entirely thrilled by this development, since
it gets them involved in situations with resellers who are often
marginal, low-overhead, and somewhat slimy, but it is a way they can
offer competitive prices to businesses too small for the bulk plans
but too big to be happy with something like Reach Out.


Regards,

John Levine, johnl@iecc.cambridge.ma.us, {spdcc|ima|world}!iecc!johnl