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December 1, 1991


By CBR Staff Writer

The latest news from British Telecommunications Plc is that its Frame Relay service is up and running in the UK, but will not be launched officially until tomorrow. BT is currently taking orders from interested customers, and has decided the service’s tariffs. Although this figure will not be released until the launch date, information received by our sister publication Telegram suggests that it will not be particularly cheap. What is known, however, is that the service will be tariffed in the same way as the American equivalent – there will be a flat-rate monthly fee which will include unlimited access time, as well as all of the connection and installation charges. Currently the company has one, unnamed, UK customer using the service. A spokesman for BT North America attributed the delay to detailed discussions over tariffs, adding weight to the suggestion that there have been problems in pricing the US service. Certainly, at first glance, BT’s offering is expensive, although direct comparisons with competitors are difficult since, in the finest telecommunications tradition each US network operator works out tariffs differently. So while BT charges a flat rate $2,100 per site with an access speed of 128Kbps, CompuServe, for example, has a wonderfully complex tariff system based on such factors as the speed at which the service is running, the user’s distance from the nearest network node, the number of Permanent Virtual Circuits in the network – that is, the number of sites being linked – and the charges of the local network operator used to link into the network. However, a spokeswoman said that $1,300 per site would be a ballpark figure for a network connecting four sites, at 1.024Mbps. In this light, neither BT’s prices nor its access speeds look particularly inspiring; nonetheless, Telecom’s Joan Carmichael, manager of the Frame Relay Service in the US, defended both. She claims that customers used to speeds of 64Kbps with X25 will find 128Kbps more than adequate for their needs, and feels it is the next logical choice. On the pricing front, she pointed out that the lower charges demonstrated by some of BT’s competitors can mask hidden tariffs in the form of installation charges. BT North America now has seven or eight users of its Frame Relay.

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