FOCUS: HI-TECH PR - Talking on the right lines. According to IT professionals, ISDN is now second generation technology. But companies are still working to capture the small business and consumer markets Phoebe Gay reports.

Since the early 1990s, a joke in the technology industry has been that ISDN stands for It Still Does Nothing. It failed to live up to the PR hype that accompanied its launch and was plagued by a very low acceptance rate because of its cost.

Since the early 1990s, a joke in the technology industry has been

that ISDN stands for It Still Does Nothing. It failed to live up to the

PR hype that accompanied its launch and was plagued by a very low

acceptance rate because of its cost.



With new competitors entering the market, the messages of high-speed

access to the internet, as well as time and cost-savings are reaching

business and consumers. Executives in hi-tech PR hope that ISDN will

come of age in 1998.



’ISDN as a connection technology has been around for many years but

negative perceptions, such as cost, mean it has not achieved dramatic

penetration rates in the UK,’ says Andrew Smith, business group director

at the A Plus Group. ’Until now, ISDN has been a solution in search of a

need and the solution was not articulated.’



What has changed is that ISDN is no longer hi-tech. It is what the

industry calls second generation technology. As such, it is tried and

tested, and more applications are being developed to make use of it.

Finally, ISDN is no longer the realm of one supplier and the cost is

coming down.



This year the industry will target small and medium-sized businesses as

the most lucrative growth area, and PR experts expect to tackle the

consumer residential market later in the year.



ISDN (Integrated Services Digital Network) is a truly digital line.

Using a conventional-looking telephone line, ISDN provides a connection

that is digital end-to-end.



There are two bandwidths within one ISDN line, each with a maximum of

64Kbps (kilobauds per second). Bundled together, they have a maximum

speed of 128Kbps. The main users of ISDN until recently have been in the

business-to-business market, particularly graphics houses that use ISDN

primarily as a data line to send and receive large files. It has also

been seen as an efficient voice connection technology.



BT is by far the largest ISDN provider, and has offered ISDN lines to

businesses since 1988. In the early 1990s, BT introduced the basic rate,

ISDN 2e (two channels each with up to 64K) for small and medium-sized

businesses.



’The small-to-medium-sized business market is still an area to explore

because ISDN is no longer technically state of the art or experimental

technology,’ says BT’s PR manager, Business Division, Glyn Jones. ’It is

no longer complicated or expensive and we felt that the large businesses

already knew about the benefits of ISDN.’



BT shifted its attention in 1995 to small and medium-sized

businesses.



’The majority of small businesses two years ago did not know what ISDN

was and how it worked,’ says Jones. ’But we made this audience aware of

its usage and how widely it is being used through education.’



Case studies demonstrated how businesses sent large data files, used

video conferencing and practised teleworking (working from home).



BT has been targeting the information technology trade press for those

who are looking at ISDN’s technical side but also the national papers,

which focus on ISDN’s uses and on customer profiles.



BT begins a new campaign focusing on ISDN in the first quarter of 1998,

targeting small businesses. Its aim is to highlight its benefits and

correct perceptions such as ISDN being expensive. It will also position

ISDN as a standard connection, while pointing out that it does much more

than transmit a voice over a telephone line.



’ISDN is changing the way people work, by offering an alternative to the

post or the courier,’ says BT’s ISDN marketing manager Nick Jones.



But PR executives such as Andrew Smith of A Plus believe that ultimately

the big selling point will be efficient and quicker access to the

internet.



’With internet usage in the UK continuing to climb, consumer users are

looking to ISDN as an affordable connection technology that will provide

the speed and reliability needed to support the increasing demands of

multimedia-enabled web sites,’ he says.



As ISDN prices come down, the 56K market (see case study) may be

overlooked.



’The fact that ISDN rates are set to tumble in the next few months may

prove the turning point for the technology as it leapfrogs current 56K

modems,’ he says.



The prices are set to fall this year because of competition from other

telecoms companies. Cable and Wireless Communications (C&W) has been

selling its own ISDN lines for ten years to large businesses. It is now

switching its focus to small and medium-sized companies as it introduces

its basic rate service. ’We believe that ISDN, because of its

flexibility over a range of business applications, is ideally suited to

small and medium-sized businesses,’ says Andy Rogers, PR manager for

C&W.



C&W promotes its ISDN lines in a similar way to BT, highlighting cost

and time efficiency but differs in stressing good value, features such

as voicemail, and 24-hour customer service. PR campaigns will target its

six million UK-based customers as well as businesses in areas where C&W

has existing business telecoms licenses.



C&W began market trials in northern England last month and, if

successful, will expand this year to its other regions, including most

of London.



It also is planning a number of initiatives to support the campaign

drawing on the experience of its roster of PR agencies which includes

Biss Lancaster and Brunswick. In the middle of this year, C&W intends to

target the residential market. To lure existing BT ISDN customers, it

will offer them the chance to move to C&W while maintaining the same

ISDN number.



Telecoms giant Worldcom will also enter the ISDN market this month by

starting to resell BT lines. Full details are still under wraps but the

company will initially target the business-to-business market through

nationwide dealer channels.



Telecoms company TDS is also entering the market this year. In August,

it joined forces with German-based Teles, which is the world’s largest

ISDN terminal adaptor provider, to license and distribute in the UK.

Like Worldcom, TDS will be reselling BT’s lines along with BT-endorsed

terminal adaptors called ’ISDN in a Box’. It will include added

applications such as fax/modem software, ’virtual secretary’ and video

mail software along with customer service/ helpdesk facilities.



TDS will target the small business market and believes that consumers

who are internet buffs and who have high disposable income will be the

next source of revenue. TDS discovered from market research that 39 per

cent of small businesses are already on the internet, disillusioned with

the speed of their modem, and would be willing to try ISDN.



’We have a ready-made market to take our solutions out to the

marketplace,’ says TDS marketing director Ian Clarke. The PR campaign

for small businesses, which has yet to be finalised, will target

specific trade publications and possibly the sponsorship of a web site

or a search engine.



Internet Service Providers are also moving into ISDN, targeting the

small business market. According to industry sources, Netcom is in

discussion with BT to resell its lines at a lower cost. The talks

include a package for small and medium-sized businesses offering an

all-encompassing ISDN system, similar to TDS. If discussions are

successful, Netcom could begin selling its packages as early as next

year.



Industry experts predict that ISDN will become mainstream within the

year but they stress that it will have a limited lifespan. With the

likely development of other faster channels for sending information -

such as cable modems which use a cable TV line instead of a conventional

phone line - the challenge once again for hi-tech PR people will be to

maintain a dialogue with both business and domestic customers in the

face of the fast moving world of technological obsolescence.



A QUESTION OF SPEED: Get ready for rush hour



Battles between rival manufacturers to establish their product as the

industry standard are not unusual. Occasionally these struggles make

headlines and can impact on the consumer.



One such example is the new generation of modems. Manufacturers have

increased the speed at which they transmit data and are offering the new

56Kbps (kilobauds per second) modems as a cheaper alternative to ISDN

technology. The two standards, K56flex and x2, cannot talk to each other

so choosing which to invest in is important for consumers.



US Robotics (www. x2.usr.co.uk) was the first company to register its

technology with the International Telecommunications Union (ITU) in

September 1996. It was unveiled to the public and media in January

1997.



Its competitors, a consortium including Rockwell International

Corporation and Lucent Technologies Inc, launched their product the

following month.



Disputes over intellectual property keep the competitors from using the

same hardware. As with any new technology vying to become the world

standard, each competitor is promoting its product as the market leader.

Both claim victory in numbers of sales and acceptance of their standard

by modem manufacturers and Internet Service Providers (ISP). This

prompted a massive PR campaign from each side. 3Com created a page

within its web site (www.3Com.com) dedicated to the x2 and K56 flex

battle called ’Facts v Fiction’.



For Lucent Technologies, the most important piece of evidence is

sales.



According to its PR agency, Kingston-upon-Thames-based EML, sales

figures for August/ September showed the K56flex in front, taking 70 per

cent of the modem industry.



For journalists and consumers the messages from the national and trade

press have been confusing. But, a year down the line, some points are

becoming clear. The 56K technology is being promoted as a cheaper

alternative to ISDN. The 56K technologies are similar. Some ISPs are

taking sides, while others are hedging their bets by adopting both

technologies. Consumers are forced to make their own decision or to

follow the lead of their ISP.



In theory, x2 and K56flex can reach a speed of 56Kbps. But consumer

tests carried out by magazines such as Internet have claimed that they

only reach speeds in the high 40s and occasionally in the low 50s. US

Robotics refused to comment on reports that consumers in the US are

suing manufacturers for failing to perform as claimed. Both

manufacturers have added disclaimers to the product packaging which

state simply that modems can reach speeds up to 56K, depending on the

quality of the telephone line.



In December, a partial resolution to the standards war was mediated by

the ITU that used aspects of both technologies and a final decision on a

standard is expected this month.



GERMANY: Deutsche Telekom adopts a simple strategy



The UK is not the only market for ISDN where the consumer has been left

almost untouched. Up until a few years ago, the take up of ISDN in

Germany was low.



When it was first introduced in December 1989, ISDN was positioned as a

flexible communications tool that provided users (both business and

residential users were targeted) with a simple and cost-effective

telecommunications solution.



In 1990, out of 32 million telephone lines in Germany, only 84,100 were

ISDN. In the past two years, however, ISDN has been taking the country

by storm. In Spring 1995, Deutsche Telekom began actively promoting ISDN

to residential and small office/home office users using a combination of

PR, advertising and direct mail (included in customer bills). By 1996,

of 44 million telephone lines, 5.2 million were ISDN. Of these, 600,000

were for residential customers.



Deutsche Telekom is currently the only ISDN player in the market because

of the slow progress of deregulation. For Deutsche Telekom, this has

provided an opportunity to establish ISDN relationships with

specifically small and medium-sized businesses and residential

customers.



The company launched an aggressive hard-sell communications campaign for

ISDN. This included a flood of TV and print advertisements targeting

both business and residential customers which announced special offer

packages for first-time ISDN connections and low-price handsets. The

advertisements were accompanied by PR aimed at educating the public.



Deutsche Telekom’s key message was simplicity along with the benefits to

small businesses and residential customers. These were promoted as two

telephone lines (one for voice and one for fax/internet access) and up

to three telephone numbers.



As the campaign progressed, simplicity was still the key message and

drove the advertising. It offered ideas on how to use ISDN, either for

high-speed internet surfing or two phone lines, allowing simultaneous

calls.



’For Deutsche Telekom, a fully-functioning ISDN system is a benefit for

companies and for private users,’ says industry observer Stefan

Ehgartner, managing director of Harvard PR in Munich. ’They promoted

high-speed data transmission for things like e-mail and data and

superfast call connection, in addition to many improved features, all

making working life a lot easier.’



The other focus of the PR campaign was to target specific markets, such

as architects and doctors, via the press and educate them about the

benefits of ISDN.



As a result, the take-up of ISDN has continued dramatically. From 31

December 1996 until 31 July 1997, a million ISDN channels were

installed, bringing the total to 6.3 million. Analogue lines are still

used substantially in Germany although, notably, the growth of analogue

lines is slower than that of ISDN.



If the take-up of ISDN in Germany continues through Deutsche Telekom’s

promotions, there may be a smaller market for new players such as Bosch

Telekom once the industry fully deregulates.



Bosch has installed two ISDN networks in the UK for British companies,

the retail group Oasis and for Lasmo. It plans to be one of the top five

ISDN suppliers in the UK by the year 2000.



BT: Making the customer connection via radio



One of BT’s chief campaigns in 1997 highlighted the value of ISDN.



Called ’Why Not Change the Way We Work,’ it was launched last May. It

focused on flexible working and productivity for large and small

firms.



BT’s basic service, ISDN2e, was promoted primarily as an alternative to

travelling to work. The campaign used advertising and direct mail along

with well-focused PR to spread the message: ISDN is teleworking. It

enables people to log-in to computers at work, to send and receive data,

and to take part in video conferencing with colleagues at home or at

other offices.



The campaign used case studies of existing ISDN customers. BT showed

that all kinds of operations use ISDN, from a global education charity

to a vegetable importer in New Covent Garden.



’ISDN is fast becoming the standard business line, accounting for over

30 per cent of all new business line orders,’ says Dominic Owens of BT’s

National Business Communications. ’Today, we wonder how we survived

without the fax machine. Tomorrow, we’ll wonder how we ever communicated

without ISDN.’



BT worked with the radio station, Classic FM, on a promotion during

European Teleworking Week at the start of November. BT installed ISDN2e

lines in the homes of all the presenters for the promotion’s final day.

The entire day’s programming came from the presenter’s homes, as far

apart as Dublin, London, Bath and Canterbury.



The response from Classic FM listeners was positive and the promotion

generated coverage by Channel 5 News as well as by regional media in the

presenters’ home towns.



BT also worked with Jazz FM in the weeks prior to Christmas to promote

teleworking over the holidays. Instead of operating a skeleton staff,

the message was to have staff available at the end of a telephone or

ISDN line.



On New Year’s Day, BT again sponsored Classic FM. The theme was to

resolve to change the way you work in 1998, highlighting ISDN and

encouraging listeners make their New Year’s resolution to work ’smarter,

not harder’.



The campaign, according to BT, was a success. During the first five

months of the campaign, more than 88,000 ISDN2e lines were

installed.



More than 20,000 firms each month are adding ISDN lines and sales are up

25 per cent.



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