Can the pstn be shut down?

1. Can the pstn be shut down? Cleveland Beverage April 14, 2011

2. Background • The Commission has been charged by congress with formulating a National Broadband Plan that will result in broadband availability for 100% of the United States • The Commission understands that Networks are transitioning from Circuit-Switched to IP-based technologies, and that Networks are a “growing platform over which the consumer access a multitude of services, including voice, data, and video in an integrated way across applications and providers”

3. Insight • Access Line Losses • “According to Greg Moffet, senior analysts at Sanford Bernstein as much as 700,000 lines a month are being disconnect, or 8,500,000 a year” • Revenues from POTS are plummeting as customers cut their land lines in favor of the convenience, and advanced features of wireless or VoIP • Due to high fixed costs of providing POTS, every customer who disconnects the service raises the average cost-per-line to maintain the legacy network

4. Continued • VoIP and Wireless Growth • CTIA said in 1997 there were approximately 55,000,000 wireless subscribers. By mid-2009 the number of wireless subscribers is around 276,600,000 • 2005 more than 59,000,000 High Speed subscribers wireless and by 2009 3G subscribership increased to more than 103,000,000 • VOIP • 2009 $7,700,000 in revenues • 2010 $8,300,000 in revenues

6. Continued • 3 major European Telco’s announced the plan to shut-down their traditional PSTN networks and completely switch to VoIP • Dutch Telekom (KPN) will shutdown the PSTN network by 2010 • British-Telekom plans to completely replace it's PSTN network by 2015 • German Telekom will finish the VoIP exercise by 2019

7. Challenges • How do you shut down the PSTN • Regulatory Approval • Support from both FCC, and State • Clarify “Is it Telecommunications or Informational service” • Develop Reasonable Time-lines • By Market type • Simultaneously Nation-wide • By Product service type • Create Migration plans from existing TDM services to VoIP services

8. Impacts • Consumers on POTS • Low Income • Elderly • Equipment Replacement • Wireless Providers Using Copper between towers and Central Office type equipment • ILEC, CLEC, and Resellers • Having to fund extensive VoIP investments • Having to continue to support PSTN during transistion • Cost of Long Distance conversion to non-covered areas • Local • International

9. Continued • E911 • Improve current methods & systems • Last Mile of Connectivity • Interoperability between IP Networks • Universal Fund • Alarm systems

10. Summary There is a lot of work that has to be done and considered and can not be done over night. It is my view that this is a just the start to many changes But something to thing about is POTS and VoIP just the beginning? Since Wireless and Mobile VOIP growing so fast?

11. But something to thing about is POTS and VoIP just the beginning? Since Wireless and Mobile VOIP growing so fast?

12. Thank You

13. Sources John Leonardelli Greg Moffet Gary AduinFCC Public Documents CTIA (Cellular Telecommunications Industry Association) AT&T CWA (Communication Workers of America) OPASTCO (Organization for the Promotion and Advancement of Small Telecommunications Companies)