1

Chapter
4
Telecommunications
and
Networks

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Learning Objectives
Identify major developments and trends in the
industries, technologies, and business
applications of telecommunications and
Internet technologies.

Provide examples of the business value of

Internet, intranet, and extranet applications.

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Learning Objectives (continued)

Identify the basic components, functions, and

types of telecommunications networks used in
business.

Explain the functions of major types of

telecommunications network hardware,
software, media, and services.

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Section I

The Networked Enterprise

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Networking the Enterprise

Networking business and employees
Connecting them to customers, suppliers, and

other stakeholders.

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Trends in Telecommunications

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Trends in Telecommunications (continued)

Industry

More
competitive
More options for the firm

Technology

Unrestricted connectivity

Easy access for end users

Open systems

Use common standards for hardware,

software, applications, & networking.
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Trends in Telecommunications (continued)

Technology (continued)
High degree of interoperability

Digital networks

Higher transmission speeds

Moves larger amounts of information

Greater economy

Lower error rates

Multiple types of communications on the

same circuits
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Trends in Telecommunications (continued)

Technology (continued)
Fiber-optic lines & cellular, PCS, satellite
& other wireless technologies
Faster transmission speeds

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Trends in Telecommunications (continued)

Business applications
Dramatic increase in the number of

feasible telecommunication applications.

Cut costs, reduce lead times, shorten

response times, support e-commerce,

improve collaboration, share resources,
lock in customers & suppliers, & develop
new products & services

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Business Value of Telecommunications

Networks

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The Internet
A network of networks
Popular uses

E-mail

Instant messaging

Browsing the World Wide Web

Newsgroups and chat rooms

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The Internet (continued)

 The business value of the Internet

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Intranets
Within an organization
Uses Internet technologies

Business value of Intranets

Used for information sharing, communication,

collaboration, & support of business processes.

Web publishing

Comparatively easy, attractive, & lower cost

alternative for publishing & accessing

multimedia business information

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Intranets (continued)

Business Operations & Management

Used for developing & deploying critical

business applications
Supports operations and managerial

decision making

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Extranets
Network links that use Internet technologies to
interconnect the firm’s intranet with the
intranets of customers, suppliers, or other
business partners
Consultants, subcontractors, business

prospects, & others

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Extranets (continued)

Business value
Improve communication with customers and
business partners
Gain competitive advantage in

Product development

Cost savings

Marketing

Distribution

Leveraging their partnerships

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Section II

Telecommunications Network Alternatives

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Telecommunications Network Alternatives

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A Telecommunications Network Model

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A Telecommunications Network Model (continued)

Consists of five basic components

Terminals

Any input/output device that uses

telecommunication networks to transmit

or receive data
Telecommunication processors

Support data transmission and reception

between terminals and computers

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A Telecommunications Network Model (continued)

Telecommunications channels
The medium over which data are
transmitted and received
Computers

Interconnected by telecommunications
networks
Telecommunications control software

Control telecommunications activities &

manage the functions of telecommunications
networks
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Types of Telecommunications Networks

Wide Area Networks (WAN)
Cover a large geographic area.

Local Area Networks (LAN)

Connect computers & other information
processing devices within a limited physical
area.
Connected via ordinary telephone wiring,
coaxial cable, or wireless radio & infrared
systems
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Types of Telecommunications Networks (continued)

Virtual Private Networks

A secure network that uses the Internet as

its main backbone network, but relies on fire

walls and other security features

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Types of Telecommunications Networks (continued)

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Types of Telecommunications Networks (continued)

Client/Server Networks
Clients – end user PCs or NCs

Server – helps with application processing

and also manages the network

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Types of Telecommunications Networks (continued)

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Types of Telecommunications Networks (continued)

Network computing
“the network is the computer”

Thin clients process small application

programs called “applets.”

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A Telecommunications Network Model (continued)

Peer-to-Peer (P2P)
Two major models

Central server architecture

Pure peer-to-peer

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Telecommunications Media
Twisted-pair wire
Coaxial cable

Minimizes interference and distortion

Allows high-speed data transmission

Fiber optics

Glass fiber that conducts pulses of light

generated by lasers
Size and weight reduction

Increased speed and carrying capacity

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Telecommunications Media (continued)

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Wireless Technologies
Terrestrial Microwave
Line-of-sight path between relay stations

spaced approximately 30 miles apart.

Communications Satellites
Geosynchronous orbits

Serve as relay stations for communications

signals transmitted from earth stations

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Wireless Technologies (continued)

Cellular & PCS Systems

Each cell is typically from one to several

square miles in area.

Each cell has its own low-power transmitter

or radio relay antenna.

Computers & other communications

processors coordinate & control the

transmissions to/from mobile users as they
move from one cell to another
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Wireless Technologies (continued)

Wireless LANs
Spread spectrum

Wi-Fi (wireless fidelity)

Wireless Web
Uses Web-enabled information appliances

Very thin clients

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Telecommunications Processors
Modems (modulation/demodulation)
Changes signals from analog to digital and

back to analog

Multiplexers

Allows a single communication channel to

carry simultaneous data transmissions from
many terminals

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Telecommunications Processors (continued)

Internetwork Processors
Switches

Makesconnections between telecomm

circuits so a message can reach its
intended destination
Router

Interconnects networks based on different

rules or protocols

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Telecommunications Processors (continued)

Hub

Port switching communications processor

Gateway

A processor that interconnects networks

that use different communications
architecture

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Telecommunications Software

Provides a variety of communications support

services including connecting & disconnecting
communications links & establishing
communications parameters such as
transmission speed, mode, and direction.

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Telecommunications Software (continued)

Network Management
Traffic management

Security

Network monitoring

Capacity planning

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Network Topologies
Star

Tiesend user computers to a central

computer
Considered the least reliable

Ring (sometimes called Token Ring)

Ties local computer processors together in a

ring on a more equal basis.

Considered more reliable & less costly
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Network Topologies (continued)

Bus

Local processors share the same bus, or

communications channel
Tree is a variation which ties several bus

networks together

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Network Topologies (continued)

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Network Architectures & Protocols

Protocols

Astandard set of rules & procedures for the

control of communications in a network
Standards for the physical characteristics of

cables and connectors

Network Architecture

Goal is to promote an open, simple, flexible,

efficient telecommunications environment

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Network Architectures and Protocols (continued)

OSI Model

TCP/IP

Transmission Control Protocol/Internet

Protocol
Used by the Internet and all intranets and

extranets

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Bandwidth Alternatives
Bandwidth is the frequency range of a
telecommunications network
Determines the channel’s maximum

transmission rate
Measured in bits per second (bps) or baud

Narrow-band

Low-speed transmission

Broadband

High-speed transmission
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Switching Alternatives
Circuit switching

Packet switching

Cell switching

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Discussion Questions
The Internet is the driving force behind
developments in telecommunications,
networks, and other information technologies.
Do you agree or disagree?

How is the trend toward open systems,

connectivity, and interoperability related to
business use of the Internet, intranets, and
extranets?
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Discussion Questions (continued)

How will wireless information appliances and

services affect the business use of the Internet
and the Web?

What are some of the business benefits and

management challenges of client/server
networks? Network computing? Peer-to-peer
networks?

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Discussion Questions (continued)

What is the business value driving so many

companies to rapidly install and extend
intranets throughout their organizations?

What strategic competitive benefits do you see

in a company’s use of extranets?

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Discussion Questions (continued)

Do you think that business use of the Internet,

intranets, and extranets has changed what
businesspeople expect from information
technology in their jobs?

Do you believe that the insatiable demand for

everything wireless, video, and Web-enabled
will be the driving force behind developments
in telecommunications, networking, and
computing technologies for the foreseeable
future?
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 51

Real World Case 1 – FedEx versus UPS

Why does telecommunications play such a key
role in the competition between FedEx and
UPS?

Why does “information about the package”

have such a strategic business value in the
express delivery business?

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Real World Case 1 (continued)

What telecommunications products or services

would you recommend that FedEx or UPS use
to improve their competitive position in the
overnight delivery and shipping business?

Consider the different management styles of

FedEx and UPS. What makes them work?

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Real World Case 1 (continued)

What other IT or web-based services could

FedEx and UPS offer their business or
consumer customers?

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Real World Case 2 – Nielsen Media Research

Managing bandwidth use

Monitoring and enforcing

Centralizing operations

Testing & tuning applications

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Real World Case 2 (continued)

How do the network bandwidth problems

experienced by the companies in this case
affect their business performance?

What network management tactics are used to

help solve these problems?

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Real World Case 2 (continued)

What other network management tactics

would you recommend to help solve the
business problems identified in this case?

What are some network usage problems not

mentioned in the case that could be solved by
better network management?

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Real World Case 3 – Link Staffing, FMC, AutoWeb, & APL

Logistics

Why do companies implement virtual private

networks?

What is the business case for outsourcing VPN

services?

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Real World Case 3 (continued)

What role does network management software

play in implementing and managing VPNs?

What challenges did each company face and

how did they use VPNs to help answer those
challenges?

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Real World Case 4 – Dow Chemical

Why have companies been reluctant to rely on
Internet telephony instead of traditional
telephone systems for business use?

Do the potential business benefits support Dow

Chemical’s decision to implement a new global
VOIP network?

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Real World Case 4 (continued)

Would you recommend that more companies

implement IP telephony services? Why?

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Real World Case 5 – General Motors Corp.

What is the business value of wireless LANs to

GM?

What are the security vulnerabilities of

wireless LANs? Is GM taking appropriate
security measures?

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Real World Case 5 (continued)

What are some other possible business

applications of wireless LANs?

What are some of the benefits and challenges

of LANs in a small business environment?

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