The Scoop

E-commerce ventures such as Netscape and Sun's iPlanetE-Commerce Solutions aren't just targeting big telecom carriers because they think the service providers might be interested in heavy-duty transaction platforms such as iPlanet's ECXpert. The e-commerce companies know that for the regional Bell operating companies it's practically a regulatory requirement that they use such products - or create their own.

Last December, Bell Atlantic became the first RBOC to gain long-distance approval from the Federal Communications Commission. To do so, the carrier had to show the FCC that it could handle heavy volumes of orders from local competitors to switch customers they had won in New York - and do so in an all-electronic environment.

AT&T and MCI WorldCom insisted on this requirement, pointing out that once they starting running ads on TV luring residential customers away from Bell Atlantic, the volumes of orders would be too heavy to handle manually.

Now that those TV ads are running in New York and tens of thousands of competitors' orders are flowing into Bell Atlantic every week, the system seems to be breaking down. And that raises into question whether a telecom regulation can really anticipate the problems of scalability in hardware and software systems.

But Bell Atlantic last week said it's having to handle a lot of competitive local exchange carrier (CLEC) orders in New York manually, and last Thursday it was due to meet with the CLECs and review with them the possibility of replacing ECXpert with its own home-grown e-commerce transaction platform. Bell Atlantic Regulatory Vice President William Allan admits that the potential replacement platform is still being tested internally. And that has left the CLECs feeling like they're starting from square one. After all, the FCC only gave Bell Atlantic the long-distance authority after an independent test of ECXpert and other back-office systems by consulting firm KPMG last year.

Even during that test, AT&T and others complained that a few of their orders were getting lost. Now that orders have risen dramatically, the problem is magnified. "Either on the way to ECXpert or on the way out - we don't know which - the orders get lost," says Harry Davidow, AT&T's chief regulatory official for New York. "They're losing 30% to 40% of them, and when the orders are lost, they're completely gone, and they don't know that they've lost anything."

Fortunately for enterprise network managers, the current problems in New York mostly affect residential and small-business customers - orders for enterprise-class CLEC data circuits go through a different procedure. But the bigger concern is how long it will be before RBOCs can offer long-distance in other states. Allan last week told Network World that Bell Atlantic has shut down testing of its local-competition systems in the three states where it hoped to next file long-distance applications - Massachusetts, New Jersey and Pennsylvania - in order to divert people working there to New York. And AT&T is certain to claim to the FCC that it is no coincidence that the first RBOC to win long-distance authority is already "backsliding" on its local-competition performance.

That's no help to SBC Communications, which is awaiting an FCC ruling on its pending application for long-distance authority in Texas. Until vendors and carriers can prove that they can trade CLEC residential orders without a hitch, the competitive telecom landscape may not change as fast as users would like.

- David Rohde