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Chapter 06 - Telecommunications and Networks
6 Telecommunications and Networks
CHAPTER OVERVIEW
Chapter 6: Telecommunications and Networks presents an overview of the Internet and other telecommunication
networks, business applications, and trends and reviews technical telecommunications alternatives.
LEARNING OBJECTIVES
After reading and studying this chapter, you should be able to:
1. Understand the concept of a network.
2. Apply Metcalfe’s law in understanding the value of a network.
3. Identify several major developments and trends in the industries, technologies, and business applications of
telecommunications and Internet technologies.
4. Provide examples of the business value of Internet, intranet, and extranet applications.
5. Identify the basic components, functions, and types of telecommunications networks used in business.
6. Explain the functions of major components of telecommunications network hardware, software, media, and
services.
7. Explain the concept of client/server networking.
8. Understand the two forms of peer-to-peer networking.
9. Explain the difference between digital and analog signals.
10. Identify the various transmission media and topologies used in telecommunications networks.
11. Understand the fundamentals of wireless network technologies.
12. Explain the concepts behind TCP/IP.
13. Understand the seven layers of the OSI network model.
6-1
SUMMARY
• Telecommunications Trends. Organizations are becoming networked enterprises that use the Internet, intranets,
and other telecommunications networks to support business operations and collaboration within the enterprise and
with their customers, suppliers, and other business partners. Telecommunications has entered a deregulated and
fiercely competitive environment with many vendors, carriers, and services. Telecommunications technology is
moving toward open, inter-networked digital networks for voice, data, video, and multimedia. A major trend is the
pervasive use of the Internet and its technologies to build interconnected enterprise and global networks, like
intranets and extranets, to support enterprise collaboration, e-commerce, and other e-business applications.
• The Internet Revolution. The explosive growth of the Internet and the use of its enabling technologies have
revolutionized computing and telecommunications. The Internet has become the key platform for a rapidly
expanding list of information and entertainment services and business applications, including enterprise
collaboration, electronic commerce, and other e-business systems. Open systems with unrestricted connectivity
using Internet technologies are the primary telecommunications technology drivers in e-business systems. Their
primary goal is to promote easy and secure access by business professionals and consumers to the resources of the
Internet, enterprise intranets, and interorganizational extranets.
• The Business Value of the Internet. Companies are deriving strategic business value from the Internet, which
enables them to disseminate information globally, communicate and trade interactively with customized information
and services for individual customers, and foster collaboration of people and integration of business processes
within the enterprise and with business partners. These capabilities allow them to generate cost savings from using
Internet technologies, revenue increases from electronic commerce, and better customer service and relationships
through better supply chain management and customer relationship management.
• The Role of Intranets. Businesses are installing and extending intranets throughout their organizations to (1)
improve communications and collaboration among individuals and teams within the enterprise; (2) publish and share
valuable business information easily, inexpensively, and effectively via enterprise information portals and intranet
Web sites and other intranet services; and (3) develop and deploy critical applications to support business operations
and decision making.
• The Role of Extranets. The primary role of extranets is to link the intranet resources of a company to the intranets
of its customers, suppliers, and other business partners. Extranets can also provide access to operational company
databases and legacy systems to business partners. Thus, extranets provide significant business value by facilitating
and strengthening the business relationships of a company with customers and suppliers, improving collaboration
with its business partners, and enabling the development of new kinds of Web-based services for its customers,
suppliers, and others.
• Telecommunications Networks. The major generic components of any telecommunications network are (1)
terminals, (2) telecommunications processors, (3) communications channels, (4) computers, and (5)
telecommunications software. There are several basic types of telecommunications networks, including wide area
networks (WANs) and local area networks (LANs). Most WANs and LANs are interconnected using client/server,
network computing, peer-to-peer, and Internet networking technologies.
• Network Alternatives. Key telecommunications network alternatives and components are summarized in Figure
6.11 for telecommunications media, processors, software, channels, and network architectures. A basic
understanding of these major alternatives will help business end users participate effectively in decisions involving
telecommunications issues. Telecommunications processors include modems, multiplexers, inter-network
processors, and various devices to help interconnect and enhance the capacity and efficiency of telecommunications
channels. Telecommunications networks use such media as twisted pair wire, coaxial cables, fiber-optic cables,
terrestrial microwave, communications satellites, cellular and PCS systems, wireless LANs, and other wireless
technologies.
6-2
• Telecommunications software, such as network operating systems and telecommunications monitors, controls and
manages the communications activity in a telecommunications network.
KEY TERMS AND CONCEPTS
1. Analog (244):
An analog signal is one in which a base carrier's alternating current frequency is modified in some way, such as
by amplifying the strength of the signal or varying the frequency, in order to add information to the signal.
Broadcast and telephone transmission have originally used analog technology.
An analog signal can be represented as a series of sine waves. The term originated because the modulation of
the carrier wave is analogous to the fluctuations of the human voice or other sound that is being transmitted.
2. Bandwidth (260):
Bandwidth describes the transmission speed and capacity of a telecommunications media or network.
3. Bluetooth (249):
A telecommunications industry specification for short range wireless communications.
4. Client/Server Networks (241):

A client/server network is a computing environment where workstations (clients) connect to servers.
5. Coaxial Cable (246):

A sturdy copper or aluminum wire wrapped with spacers to insulate and protect it. Groups of coaxial cables
may be bundled together in a bigger cable for ease of installation.
6. Communications satellites (247):

Earth satellites serving as relay stations for microwave communications signals.
7. Digital (244):
Digital describes electronic technology that generates, stores, and processes data in terms of two states. These
states are typically represented as "0" and "1".
8. Extranets (232):
A network that links selected resources on an organization's network to its customers, suppliers, or other
business partners, using internet technologies.
9. Fiber optics (246):

Fiber optics uses cables consisting of one or more hair-thin filaments of glass fiber wrapped in a protective
jacket. They can conduct pulses of visible light elements ( photons ) generated by lasers at transmission rates as
high as trillions of bits per second (terabits per second, or Tbps).
10. Internet Service Providers (225):

An ISP is a company that provides access to the Internet to individuals and organizations.
11. Internet Networking Technologies (222):

Internet networking technologies consist of hardware, software, and standardized protocols used to create
telecommunications networks.
6-3
12. Inter-network Processors (252):

Internetwork processors such as bridges, routers, hubs, or gateways to other networks.
13. Intranets (229):

An intranet is a network inside an organization that uses Internet technologies (such as Web browsers and
servers, TCP/IP network protocols, HTML hypermedia document publishing and databases, and so on) to
provide an Internet-like environment within the enterprise for information sharing, communications,
collaboration, and the support of business processes.
14. Legacy systems (242):

Legacy systems refer to an organization's outdated business information systems.
15. Local Area Networks - LANs (239):

A LAN is a communications network that connects computers, terminals, and other computerized devices
within a limited physical area such as an office, building, floor, manufacturing plant, or worksite.
16. Metcalfe’s Law (218):

Metcalfe's Law expresses the value of a network as the square of the number of its users.
17. Middleware (222):

Middleware is a general term for any program that serves to "glue together" or mediate between two separate
programs.
18. Modems (251):

A modem (modulator-demodulator) is a device that converts the digital signals from input/output devices into
analog signals for transmission over an analogue carrier at the sending node and converts analog signals back
into digital signals at the receiving node.
19. Multiplexer (252):

An electronic device that allows a single communications channel to carry simultaneous data transmissions
from many terminals.
20. Network (218):

The term network means an interconnected or interrelated chain, group, or system.
21. Network Architectures (255)

An organization's telecommunications environment including computers, software, communications standards,
and transmission media.
a. Open systems interconnection - OSI (255):
A seven-layer Open Systems Interconnection (OSI) developed by the International Standards Organization
(ISO) to serve as a standard model for network architectures in order to promote an open, simple, flexible,
and efficient telecommunications environment.
b. TCP/IP (257):
Transmission Control Protocol/Internet Protocol (TCP/IP) consists of five levels of protocols that can be
related to the seven layers of the OSI architecture. The use of TCP/IP defines the Internet and all intranets
and extranets.
22. Network computing (242):

A system of computing in which “the network is the computer,” that is, the view that a few powerful computers
on the network provide the central computing resource for the network's users.
6-4
23. Network interoperability (261):

Network interoperability describes the ability for one network to communicate with other networks.
24. Network topologies (254):

A network topology describes the relationship between network nodes and telecommunications media.
25. Open Systems (222):

Open systems are information systems that use common standards for hardware, software, applications, and
networking.
26. Peer-to-Peer Networking (243):

P2P networks enable computers to connect and communicate directly with each other.
27. Protocol (255):

Protocols consist of a set of rules and procedures for the control of communications in a network.
28. Telecommunications (221):

Telecommunications consist of the exchange of analogue or digital signals between computer nodes over a
distance.
29. Telecommunications media (245):

Telecommunications media consist of the hardware or channel through which signals travel. They include,
twisted-pair wire, coaxial cables, fiber optic cables, terrestrial microwave, communications satellite, cellular,
radio frequency, and infrared systems.
30. Telecommunications network (235):

A telecommunications communications network is any arrangement in which a sender transmits a message to a
receiver over a channel consisting of some type of medium .
31. Telecommunications processors (251):

Multiplexers, concentrators, communications controllers, and cluster controllers that allow a communications
channel to carry simultaneous data transmissions from many terminals. They may also perform error
monitoring, diagnostics and correction, modulation-demodulation, data compression, data coding and decoding,
message switching, port contention, and buffer storage.
32. Telecommunications software (253):

Telecommunications software includes network operating systems, telecommunications monitors, web
browsers, and middleware, that controls and supports the communications activities in a telecommunications
network.
33. Virtual private network (VPN) (239):

A VPN consists of a network created by two private networks connected securely to each other via the Internet.
34. VoIP (258):

VoIP (voice over IP) is a system through which voice communications transmit over the internet in a manner
similar to a telephone call.
35. Wide Area Network - WAN (238):

A WAN is a data communications network covering a large geographic area.
36. Wireless LAN (249):

A wireless LAN is a local area network supported entirely without telecommunications cables.
6-5
37. Wireless technologies (223):

The hardware, software, and protocols used to connect devices without the use of cables by means of radio,
microwave (high frequency radio), or infrared transmissions.
ANSWERS TO REVIEW QUIZ
Q. A. Key Term Q. A. Key Term

1 34 VoIP 21 2 Bandwidth
2 23 Network interoperability 22 33 Virtual Private Network
3 20 Network 23 5 Coaxial cable
4 17 Middleware 24 27 Protocol
5 16 Metcalfe’s Law 25 21a OSI
6 13 Intranets 26 21b TCP/IP
7 8 Extranets 27 25 Open systems
8 10 Internet service provider 28 12 Internetwork processors
9 35 WAN 29 11 Internet networking technologies
10 15 Local area networks 30 4 Client/server networks
11 7 Digital 31 22 Network computing
12 29 Telecommunications media 32 26 Peer-to-peer networks
13 9 Fiber optics 33 6 Communications satellites
14 3 Bluetooth 34 14 Legacy systems
15 31 Telecommunications processors 35 28 Telecommunications
16 32 Telecommunications software 36 36 Wireless LAN
17 18 Modems 37 21 Network architectures
18 19 Multiplexer 38 30 Telecommunications network
19 24 Network topologies 39 37 Wireless technologies
20 1 Analog
6-6
ANSWERS TO DISCUSSION QUESTIONS
1. The Internet is the driving force behind developments in telecommunications, networks, and other
information technologies. Do you agree or disagree? Why?
Agree
The Internet provides common protocols for information exchange (TCP/IP, HTML, and XML to name the
most common), and this inexpensive mode of communications appeals to many interests personal, public, and
commercial. Networks and related technologies serve as the enablers, and demand continues to drive
economies of scale and innovation.
Disagree
The driving force is the human desire to communicate.
2. How is the trend toward open systems, connectivity, and interoperability related to business use of the
Internet, intranets, and extranets?
Businesses are looking for the least expensive access to resources available. Open systems, connectivity, and
interoperability make these resources more readily available via internet technologies. They also help ensure
flexibility and long-term support – both important management issues.
3. Refer to the Real World Case on telemedicine and videoconferencing in the chapter. Not mentioned in
the case are implications for both privacy and data security arising from the use of these technologies. Which
specific ones could arise as a result, and to what extent do you believe those would inhibit the deployment of
these advances?
Privacy and security concerns exist for any networked health-care solution, and teleconferencing would be no
different. Undoubtedly, doctors would transmit and discuss patient information governed by various privacy
laws including HIPAA. Teleconferencing solutions providers should provide the same privacy protections
afforded other medical applications. These solutions would revolve around authentication, access control, and
encryption.
4. How will wireless information appliances and services affect the business use of the Internet and the
Web? Explain.
Affects
The overall effect will be massive growth of wireless information appliances and related applications.
Examples
• Marketing can now reach customers right at the point of purchase.
• Sales personnel can reduce sales cycle times by capturing sales real-time.
• Sales personnel can provide real-time competitive intelligence directly from the field.
• Distribution can optimize delivery schedules real-time.
• Supply chain can capture the movement of raw materials, WIP, and finished goods real-time.
• Employees will require fewer hours working in an office.
• Customer service can directly monitor product performance in the field.
6-7
5. What are some of the business benefits and management challenges of client/server networks? Network
computing? Peer-to-peer networks?
Client/server benefits:
• Clients (end users) take the computing burden off the server, thereby allowing the server to accommodate
more users.
• Servers centrally control information access and flow.
• Servers handle connectivity to and security between other servers.
• If the server fails, users can still continue using their machine for local tasks.
• Client-side processing is more tailored to the needs of the end users.
Client/server challenges:
• Client-side hardware is more expensive than network computers
• Client-side applications are more difficult to maintain than server side applications (one update on a server
v. hundreds of updates on the client-side).
Network computing benefits:
• Client-side hardware is cheaper.
• Applications are located on the server and easier to maintain.
• Clients can access a massive amount of computing power if necessary.
Network computing challenges:
• Network computers require enough computing power to handle peak loads.
• If the network computer fails, then all nodes cease to function.
Peer to peer benefits:
• Requires minimal (or no) servers.
• Processing and storage are distributed and use only surplus capacity.
Peer to peer challenges:
• Security
• Applications are more difficult to maintain than server based applications (one update on a server v.
hundreds of individual updates on the client-side).
6. What is the business value driving so many companies to install and extend intranets rapidly throughout
their organizations?
Intranets decrease communications costs. They increase the number of employees reached, the volume of
information they can access, and the speed at which this information flows.
7. What strategic competitive benefits do you see in a company’s use of extranets?

Strategic benefits derive from offering customers, suppliers, and partners with unique capabilities afforded by
effective and efficient communications. Examples include streamlined order processing, customer service,
account management, collaboration, and general communications. These abilities may help raise barriers to
entry, increase switching costs, decrease operating costs, and help improve product quality.
8. Refer to the Real World Case on telepresence in the chapter. What seems to be the difference between
videoconferencing and telepresence? Given the discussion on the latter in the case, does videoconferencing
have a future? Why or why not?
Differences: Telepresence is a high-end version of videoconferencing. Video conferencing involves sharing
audio and video feeds. Telepresence uses these feeds to give the participants the feeling that they are sharing
the same space. Cisco does this through high definition videos and multiple screens.
Bright future: Since Telepresence isn't mobile and videoconferencing is, videoconferencing has a significant
future.
6-8
No future: Given "Moore's Law" and the steady improvements in telecommunications, there's no reason
telepresence can't also become more mobile at some point in the future. As a result, videoconferencing has no
long-term future.
9. Do you think that business use of the Internet, intranets, and extranets has changed what businesspeople
expect from information technology in their jobs? Explain.
Yes. Over the last two decades, employees have seen significant improvements to information and information
access. The most recent improvements stem directly from internet related technologies. The direction these
improvements have taken allow employees to envision an even more robust future, and this significantly
increases their information technology expectations.
No. Personal use of the Internet has changed what people expect from IT. Personal applications have far
outstripped what is available in the business environment, and it is this market that has set employee's
expectations. The idea that, "if I can do this cool stuff at home, I should be able to do this at work," has driven
expectations for better IT at work.
Example
Peer-to-peer file sharing boomed with Napster and others years before software vendors figured out how to use
it to distribute licensed copies of their software. For example, Blizzard now uses peer-to-peer file sharing in
order to handle massive download demands on game-release day. 1
10. The insatiable demand for everything wireless, video, and Web-enabled everywhere will be the driving
force behind developments in telecommunications, networking, and computing technologies for the
foreseeable future. Do you agree or disagree? Why?
Agree: 3G and now 4G devices, applications, and networks have all taken the headlines. The massive number
of these internet-ready devices is also hastening the implementation of IPv6 as regions run out of IP addresses
under the old scheme. People expect information and video access wherever they are.
1
Starcraft II's installer defaults to peer-to-peer for its game download scheme.
6-9
ANSWERS TO ANALYSIS EXERCISES
1. How many addresses are enough?

a. Express as a power of 2 the number of nodes that can exist using IPv4.
2^32
b. Express as a power of 2 the number of nodes that can exist using IPv6.
2^128
2. MNO Incorporated Communications Network

a. Create a database table with an appropriate structure to store the data below. Enter the records shown
below and get a printed listing of your table.
See Data Solutions Disk for a sample database.
b. Survey results suggest that the peak traffic to and from a site will be approximately 2 kilobits per second
for each phone line plus 10 kilobits per second for each computer. Create a report showing the estimated
peak demand for the telecommunications system at each site in kilobits. Create a second report grouped by
region and showing regional subtotals and a total for the system as a whole.
See Data Solutions Disk for a sample database.
3. Wireless Radiation
a. Use an Internet search engine and report on what the World Health Organization (WHO) has had to say
about microwave radiation or nonionizing radiation.
The WHO conducted a ten years study from 2000 to 2010. The study consisted of 13,000 people in 13
countries and found no link to cancer. Some data "suggested" a link with glioma, but it acknowledged study
bias could account for these results. As a result, the WHO could pronounce no "definitive" results and
suggested more study.
b. Use an Internet search engine to identify the various complaints posed by stakeholders regarding cell
phone towers. Write a one-page paper describing an alternative to cell phone towers that would enable cell
phone use and yet mitigate all or most of these complaints.
Complaints:
• Fear of cancer or other illness
• Unsightly cell phone towers
Alternatives:
Rather than using cell towers with effective transmission ranges of up to a mile, some advocates have
encouraged cell phone companies to install numerous, low-cost, cell stations. These smaller stations only need
sufficient transmitting power to extend a few hundred yards and would not require tall towers. Instead of
towers, phone companies could place these small stations on the tops of telephone poles or on the roofs of two
or three storied buildings. This approach has several advantages. Small transmitters would require very little
power to cover a range of only a couple hundred yards thereby reducing the strength of transmitted microwaves,
they would blend into their surroundings thereby eliminating eyesores, and they would allow cell phones to
transmit on very low power thereby enabling even smaller phones or significantly increased battery life.
6-10
4. Maximizing Communications
a. In Excel’s menu, select “Data” and then “Sort” and then press the “F1” key for help. Read through each
of the topics. How would an ascending sort arrange the list “Smith; Jones; Zimmerman”?
Ascending order sorts from the lowest value to the highest value or in alphabetical order for text data. In this
case: "Jones; Smith; Zimmerman"
b. What feature allows users to sort month lists so January appears before April?
The "Options" button within data sorting dialog box opens a new dialog box that allows users to select an
alternative sort order. Excel lists several default sort orders including one by the name of the month.
c. Sort the partner data first on Gender, then by Industry, and then by Region, and save the file.
See Analysis Exercise Data Solutions files: [Chapter 06 - Solutions.xls].
The results from this sort will depend on the starting point. The original file has been sorted in ascending order
by last name and then by first name. This ordering will take forth and fifth precedence following industry,
region, and gender. Since this exercise doesn't specify maintaining this order, you may expect varying results.
Simply check to ensure that industry, region, and gender are in the proper order and ensure students have
included all columns in their data sort. Failing to do so will result in partners who have been inadvertently
reassigned gender, industry, or region. For example, Ziara Abud started off as a female audit partner in the
Americas, and your student's data should maintain this.
d. Examine the sorted results from the previous step. Notice that assigning the first eight partners to the
same table would minimize diversity. This result should also provide a clue about how to maximize diversity.
Using this insight, assign a table number in the range from 1 to 50 to each partner in your sorted list so to
maximize diversity. Save the file as “partners_sorted.xls” and explain your logic.
See Analysis Exercise Data Solutions files: [Chapter 06 - Solutions.xls].
Since assigning table #1 to the first eight partners in the list minimizes diversity, assigning tables {1, 2,… 50}
to the first fifty partners will maximize diversity. Start the table numbering over again with the 51 st partner.
This process ensures that the partners who are grouped together by the sorting activities are split up across
different tables. While not every table will have four men and four women, this reflects the fact that the firm is
not equally balanced by gender at the partnership level. Indeed, this in itself may make for an interesting
classroom discussion. See "partners_sorted.xls" on your faculty CD for a sample solution. Note: encourage
students to use Excel's Auto Fill feature rather than type all four-hundred table numbers individually.
6-11
ANSWERS TO REAL WORLD CASES
RWC 1: DLA Piper, MetLife, PepsiCo, and Others

Case Study Questions
1. Implementing telepresence seems to have other, less tangible, advantages beyond travel cost savings.
What are some of those? How do you quantify them to make the case for investing in the technology? Provide
at least two fully developed examples.
Intangible benefits
• Helps "green" initiatives
• Improves employee's quality of life
• Increase junior team member's exposure to executive management
• Improves working relationships
Indirect methods to quantify impact
• Count instances of coverage by industry press
• Note changes in employee turn-over rates
• Note changes in recoverable hours
• Note changes in billable hours
• Evaluate client retention
2. DLA Piper, MetLife, and the other companies featured in the case are very optimistic about the
technology. However, other than its cost, what are some potential disadvantages of implementing telepresence
in organizations?
Disadvantages
The case does not specifically discuss disadvantages other than cost.
• Important meetings are at the mercy of technology failures
• Overreliance on video conferencing might hinder the development of personal relationships
3. Do you think meetings conducted through telepresence technology will be similar to face-to-face ones as
the technology becomes more pervasive? How would the rules of etiquette change for telepresence meetings?
Which type of meeting would you like best?
Similarities
• Real-time communication
• Body language aids communication
Differences
• Less personal
• Meeting ends at the end – minimal socializing after work
• More impromptu – meetings can be arranged more quickly than travel
Etiquette
• When meeting across time zones, which party gets up early or stays up late?
• Agreement and trust on the subject of recording the meeting
• Beware the "open microphone"
• Participants should minimize side conversations as microphones pick up all voices equally
6-12
Real World Activities

1. Telepresence is described in the case as a green technology because it replaces air travel with a more
environmentally friendly alternative. Recently, many organizations are looking to IT to help them cut their
carbon footprint. What other technologies can be helpful in this regard?
Sample "Green" IT Technologies
• Google's containerized server rooms
• Google's server motherboards with built in UPS
• Cloud computing pooling resources
• "Smart" appliances that run off-peak
• Solid State Drives (SSD) that are faster and use less power than hard drives
• Virtual Machines (VM) reduce the number of physical servers required
• Virtual Private Networks (VPN) allow users to work from home and avoid commuting
• Mobile computing that allows users to capture data and/or work on the road
• GPS/traffic analysis help drivers avoid current traffic congestion
• Route planning software to minimize distance driven and left-hand turns
• "Remote support" allows fewer IT support people to serve geographically disperse users
• Grid computing using existing machines during off-peak computing times
2. Go online and research different ways in which the “green IT” movement is catching on. Prepare a
report to share your findings.
Search terms
• "green IT"
• "green computing"
3. The organizations featured in the case are not too keen on the future of business travel. Despite the high
quality of current and future telepresence systems, do you believe these companies are missing something by
not having people meet face to face? Why or why not? Break into small groups with your classmates to
discuss this issue.
The case does not state that organizations have banned travel – just that they have reduced travel. These
organizations still have face to face meetings when appropriate. In fact, they may increase the total number of
meetings (when counting video meetings), and this may serve to improve working relationships rather than
hinder them.
RWC 2: Brain Saving Technologies, Inc. and the T-Health Institute

1. From the perspective of a patient, how would you feel about being diagnosed by a doctor who could be
hundreds or thousands of miles away from you? What kind of expectations or concerns would you have
about that kind of experience?
Feelings:
I wouldn't care about the source of a diagnosis so long as I had confidence in the source's competence.
Expectations:
I would expect a local specialist involved in the diagnosis. The local specialist would act as my advocate and as
a safety check. A specialist rather than a general practitioner or intern would be more able to detect and
communicate my symptoms to the remote expert.
6-13
Concerns:
I would be concerned that the remote expert wasn't getting all the information necessary to make an accurate
diagnosis including information that may be unique to my case. Hospitals already face criticism for providing
impersonal care. Adding a remote expert into the loop will do nothing to address these concerns. I would also
be concerned that a local specialist and the remote expert were in collusion to charge my insurance company for
an unnecessary consultation.
2. What other professions, aside from health care and education could benefit from application of some of
the technologies discussed in the case? How would they derive business value from these projects? Develop
two proposals.
Other professions:
• Engineering projects
• Auditors working on global corporations
• Teams working on mergers or acquisitions
• Political campaigns
Proposals:
1) Implementing high quality video conferencing can be an expensive project and a distraction from core
business. Therefore, a service provider might undertake to create an international network of video conference
centers. End users would only need to commute to the nearest conference center to participate in a conference.
Cisco Systems is currently undertaking just such an initiative.
2) A global corporation might implement a high quality video conferencing system in order to reduce travel
costs and the inconvenience frequent travel places on its employees. In Star Trek terms, one might think of
these facilities as virtual "transporter rooms."
3. The deployment of IT in the health professions is still very much in its infancy. What other uses of
technology could potentially improve the quality of health care? Brainstorm several alternatives.
A few suggestions:
• Integrated billing
• Universal access to patient records
• Family/patient education
• Doctor/staff continuing education
• Supply chain management (many examples already exist)
• Prescription drug dispensing machines (to reduce errors)
• Doctor/hospital performance reporting

1. Technology enhances the ability of educational institutes to reach students across geographic boundaries.
One recent development in this area is YouTube EDU. Go online to check out the site and prepare a report
summarizing its objectives, the kind of content available there, and how it could be used to support
traditional modes of education delivery, such as lectures.
URL: http://www.youtube.com/education?b=400
Objectives:
YouTube – EDU gives two and four year degree granted public and private colleges and universities their own,
individual YouTube channel through which they can organize and publish videos. (YouTube.com)
Content:
Content ranges from messages from the institution's administration and student orientation to classroom lectures
and related content.
6-14
Classroom support:
• Professors could tape their classes and make them available online if they are willing to give away the
content for free.
• Professors might find videos that supplement their lectures and assign them for viewing.
2. If widely adopted, these technologies could conceivably lead to a concentration of specialists in a small
number of “hub” institutions, essentially creating a two-tier health care system. Do you believe this would
lead to an increase or decrease in the availability of these professionals for patients? What could be the
positive and negative consequences of this development? Break into small groups with your classmates to
discuss these issues.
Availability:
The main point is to make experts more available to the people who need them. Its secondary objective,
provide educational access, should help maintain or increase local specialist's expertise. Video conferencing
should also help reduce the need for hubs of specialty (which have long been in existence). The reduction will
come because experts will no longer need to work in physical proximity in order to collaborate.
Positive impact:
• Increase collaboration
• Increase the dissemination of information.
• Increase access to experts.
Negative impact:
• Create an over-reliance on technology that could fail in an emergency
• Potentially depersonalize medicine even further
RWC 3: Metric & Multistandard Components Corp.: The Business Value of a Security Self-Managed
Network for a Small-to-Medium Business
1. What were the most important factors contributing to MMCC’s success with its new, secure, self-
managed network? Explain the reasons for your choices.
• increased bandwidth (eliminated congestion)
• improved reliability (less down time, greater productivity)
• improved security (obvious but not explained in the case)
• easier to manage (lower personnel costs)
• lower costs (fast payback period, lower risk)
2. What are some of the business benefits and challenges of self-managed and externally managed
networks?
Self-managed benefits:
• Greater accountability
• Greater flexibility
Self-managed challenges:
• Lack of expertise
• Distracts from core operations
Externally managed benefits:
• Access to expertise
• Potential for economies of scale (not mentioned in case)
• Doesn't distract from core business
6-15
Externally managed challenges:

• Lack of accountability (extra communications layer)
• Inflexible contract (locked in)
3. Which type of network management would you advise small-to-medium business firms to use? Explain
the reasons for your recommendation.
Self-managed. Network technology is fairly mature and requires minimal customization. Expertise is not
difficult to find when required.

1. Use the Internet to discover more about the telecommunications products and services and current
business performance and prospects of Cisco Systems and Hi- Link and some of their many competitors in
the telecom industry. Which telecom hardware and software company and IT consulting firm would you
recommend to a small-to-medium business with which you are familiar? Explain your reasons to the class.
Cisco Systems:
Cisco is a publicly held company that makes IP based networking hardware and software and provides related
products and services. Cisco is the industry leader.
Hi-Link
Hi-Link is a privately held corporation providing a range of network related consulting services. It is one of
many similar IT consulting firms in the industry. It is a certified partner of a variety of hardware and software
manufactures.
Cisco's competitors include
• 3Com
• Nortel
• Juniper
Recommendations
Note: This recommendation applies to small and medium firms that lack the time and resources to conduct a
detailed analysis of its unique needs and vendors' product offerings.
Cisco is the leading industry leading hardware vendor. Choosing a different product would require a very
careful rationale. When in doubt, go with the leader. For implantation, it's best to stick with a firm certified by
the vendor. This helps ensure they have the required expertise and access to higher level support. They should
also have offices in all the installation locations. This helps reduce travel costs.
2. In telecommunications network installation and management, as in many other business situations, the
choice between “do it yourself” and “let the experts handle it” is a crucial business decision for many
companies. Break into small groups with your classmates to debate this choice for small-to-medium
businesses. See if you can agree on several key criteria that should be considered in making this decision, and
report your conclusions to the class.
Key criteria:
• product maturity, stability, and reputation
• vendor experience, stability, and reputation
• degree and availability of expertise
• degree of customization required
• potential for economies of scale (cost savings)
6-16
RWC 4: Starbucks and Others

1. Do you agree with the plans by Starbucks to offer time-limited free Wi-Fi to customers? Part of the idea
is to push the Starbucks card and reap other business benefits from doing so. Do you think free Wi-Fi would
be enough to instill that kind of loyalty? Based on the experiences of the other coffee houses reported above,
do you think free access was a critical factor in developing a loyal customer base?
Agree:
If I were a Starbucks stockholder, the only question I would have is "is this making us money?" Starbucks has
enough stores to run controlled tests to determine optimal pricing and deals. Regardless, Starbucks has not
locked itself into a long-term solution. With a Wi-Fi infrastructure in place, they can deploy it as they see fit.
Finally, all Wi-Fi providers need to be aware that "free Wi-Fi" maps exist for just about any location. These
maps highlight locations with open and free Wi-Fi access. Starbucks (and others) need to know that if they
offer this service for free, they will quickly appear on these maps.
Loyalty:
Loyalty cards work because the customer sees a benefit to using them. Typically these benefits revolve around
free stuff. In this case, it's free Wi-Fi. It could just as well be a free beverage.
Customer base:
Wi-Fi might get people in the door, but delivering value will keep them spending money. Because free Wi-Fi is
increasingly available, Wi-Fi users have more choices, and they need not put up with an inferior product.
Therefore, free Wi-Fi is a good promotional tool, but nothing more. Stores must also contend with the effect
free Wi-Fi will have on the customer experience. Traditional coffee house customers enjoy coffee and
conversation. Free Wi-Fi has made some stores resemble the workplace environment with a dozen or more
heads buried in their laptop computers. This customer base tends to use the store for "free parking" rather than
refreshment and relaxation, and traditional customers may not appreciate the change.
2. Part of the reason for Starbucks’s move had to do with increased competition from chains like
McDonald’s for the morning breakfast crowd. However, Starbucks and McDonald's hardly seem to be
targeting the same public. Do you think that free wireless access by such a competitor would have moved a
significant portion of Starbucks' customers away? Why or why not?
Note 1: this question appears to pre-suppose that Starbucks and McDonalds do not compete for the same
customers but then asks for the student's opinion. The question essentially reduces to whether or not the student
believes enough food & beverage customers seeking a place to use Wi-Fi would choose McDonalds over
Starbucks if McDonalds offered free Wi-Fi access to make a difference to Starbucks.
Note 2: this question is very significant to Starbucks' bottom line. Why? During peak rush times, both
Starbucks and McDonalds operates at peak capacity. Therefore attracting more customers during these times
offers little benefit. On the other hand, attracting customers between rush periods translates to additional store
revenue, and Wi-Fi appeals to this segment.
Effectiveness: Starbucks obviously believes that McDonalds poses a threat or they wouldn't have lowered their
Wi-Fi access price. McDonalds clearly believes that it can compete against Starbucks as evidenced by their TV
advertisement campaign highlighting their coffee's taste test victories over Starbucks. Some McDonalds have
also redesign portions of their dining areas to make them more comfortable and encourage patrons to linger.
3. The case notes some companies that offer free Wi-Fi in exchange for viewing advertisements or
answering questions for market research studies. Would you be willing to do so in order to get free wireless
access, say, at an airport? Would your answer change if you were using a corporate laptop versus your own,
because of security concerns?
Personal use answers will vary.
The corporate use answer should take into consideration corporate policy. Also note that G3 and G4 networks
now offer a competitive alternative to free Wi-Fi and are less likely to violate policy.
6-17

1. Johan Bergendahl of Ericsson believes the demise of Wi-Fi is rather imminent and that mobile
broadband will replace hot spots for wireless access. Search the Internet for current commercial offerings of
mobile broadband and compare their features with Wi-Fi hotspots. Which one would you choose? Which
factors would affect your decision? Prepare a report to share your findings and opinions.
Broadband Features:
Greater coverage area than Wi-Fi
Wi-Fi Features:
• Faster transmission speeds
• Low cost
• Hardware availability
Decision factors:
• speed
• coverage
• cost
• reliability
• security
Trend:
The trends are interesting. Wi-Fi coverage areas are increasing – but piecemeal. Projects to offer Wi-Fi city-
wide have failed. On the other hand, broadband costs are going down, security is built into the product, and the
necessary hardware has begun to proliferate. If broadband can overcome the transmission speed issue, and
there's no reason to think it eventually won't, it will likely prevail.
2. Go online and look at different companies in one of the industries mentioned in the case, noting which
companies offer free wireless access and which ones do not. Break into small groups and brainstorm
potential explanations for these differences. Do you see any patterns in the type of companies that charge for
access versus those that offer it for free?
Industries mentioned:
• Hospitality
• Transportation
Hospitality (hotels) resources:

List of chains 2 3
"Best WiFi Hotels" 2009 list4
Benefits analysis:
General benefits to Wi-Fi5
Hotel WiFi services vendors 6 7
2
http://www.ajc.com/travel/content/travel/articles/stories/2007/03/13/0311gohotels.html
3
http://freehotelsearch.com/allChains.html
4
http://www.hotelchatter.com/special/Best_WiFi_Hotels_2009
5
http://www.ciscopress.com/articles/article.asp?p=680821
6
http://www.wirelessnetworkproducts.com/wi-fidesignservice.aspx
7
http://www.wanderingwifi.com/hospitality/index.html
6-18
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6 Telecommunications and Networks

1. Understand the concept of a network.

2. Apply Metcalfe’s law in understanding the value of a network.

7. Explain the concept of client/server networking.

8. Understand the two forms of peer-to-peer networking.

9. Explain the difference between digital and analog signals.

11. Understand the fundamentals of wireless network technologies.

12. Explain the concepts behind TCP/IP.

13. Understand the seven layers of the OSI network model.

KEY TERMS AND CONCEPTS

4. Client/Server Networks (241):

5. Coaxial Cable (246):

6. Communications satellites (247):

9. Fiber optics (246):

10. Internet Service Providers (225):

11. Internet Networking Technologies (222):

12. Inter-network Processors (252):

13. Intranets (229):

14. Legacy systems (242):

15. Local Area Networks - LANs (239):

16. Metcalfe’s Law (218):

17. Middleware (222):

18. Modems (251):

19. Multiplexer (252):

20. Network (218):

21. Network Architectures (255)

22. Network computing (242):

23. Network interoperability (261):

24. Network topologies (254):

25. Open Systems (222):

26. Peer-to-Peer Networking (243):

27. Protocol (255):

28. Telecommunications (221):

29. Telecommunications media (245):

30. Telecommunications network (235):

31. Telecommunications processors (251):

32. Telecommunications software (253):

33. Virtual private network (VPN) (239):

34. VoIP (258):

35. Wide Area Network - WAN (238):

36. Wireless LAN (249):

37. Wireless technologies (223):

ANSWERS TO REVIEW QUIZ

Q. A. Key Term Q. A. Key Term

ANSWERS TO DISCUSSION QUESTIONS

7. What strategic competitive benefits do you see in a company’s use of extranets?

ANSWERS TO ANALYSIS EXERCISES

1. How many addresses are enough?

2. MNO Incorporated Communications Network

ANSWERS TO REAL WORLD CASES

RWC 1: DLA Piper, MetLife, PepsiCo, and Others

Real World Activities

RWC 2: Brain Saving Technologies, Inc. and the T-Health Institute