Verizon’s (News - Alert) hard line on negotiating union contracts is yet another indication that the TDM networks over which 96 percent of U.S. businesses rely are no longer being supported at the levels they once were by incumbent telephone companies, says Stephen Canton, CEO of iCore Networks and a former Bell Atlantic employee. Of course, it’s also a clear indication that service providers like Verizon are pulling investment in the PSTN and placing their bets on wireless and other IP technologies.

As Verizon works with the International Brotherhood of Electrical Workers and Communications Workers of America to come to an agreement on contracts covering 45,000 workers in the Mid Atlantic and Northeast, union organizers are expressing extreme concern over the level of concessions the telco is seeking. One report quotes a CWA (News - Alert) president saying that Verizon wants everything back that the union has won during 50 years of negotiations.

The piece goes on to say that the average Verizon union technician makes $75,000 a year, plus $50,000 in benefits, but that the number of these folks on the telco payrolls is fading fast. The wireline businesses of cable TV, satellite and telephone companies in the U.S., according to the Labor Department, reportedly employed 575,000 people in May. That’s 4 percent less than the previous year and about 40 percent fewer than a they did 10 years ago.That may help explain why getting into the demarc in a building used to be like getting into Fort Knox ­– you needed all kind of security clearance to get into these areas of vital infrastructure, but is now accessible to anybody with a brick that wants to prop open the box, Canton says.

That says, Canton adds, it’s critically important for businesses that are still relying on circuit-switched technology to make the move to IP services, which deliver quality, service, savings and security.

As noted in a July 11 TMCnet posting, in case there was any doubt that telcos are moving away from the PSTN and toward IP networks, many of the nation’s largest service providers have made that perfectly clear in their recent statements to the Federal Communications Commission.

Some of the industry’s biggest names – including AT&T (News - Alert), Global Crossing, Time Warner Telecom, XO Communications and others – have been calling for a sunsetting of investment in TDM infrastructure. And late last month Time Warner Telecom took the argument a step further by filing with the FCC (News - Alert) a petition requesting that the commission issue a declaratory ruling on an all-IP interconnection model, which would mean the end of POTS.

Interestingly, Time Warner Telecom and its cohorts on this issue are calling for the FCC to reclassify interconnected VoIP from a Title I to a Title II service, which will move it from an unregulated service to a regulated service. I say interestingly because you don’t often see tier 1 service providers actively seek regulation of an unregulated business. It seems to make even less immediate sense when you consider that these service providers are migrating more of their traffic to VoIP, so you might think they’d prefer to keep the growing part of their business on infrastructure that is unregulated and just keep a bare bones operation going on the regulated PSTN side.

But continuing to prop up the PSTN creates giant operational inefficiencies that these carriers apparently are so keen to address that they’re actively seeking regulation around interconnected VoIP. If everybody is required to support interconnected VoIP, the thinking is, no one will be required to meet TDM mandates around interconnection. Richard Shockey estimates that U.S. carriers could realize at least $20 billion in operational savings over 10 years if they were allowed to phase out PSTN infrastructure. 

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