PDF of this tutorialDefinition
In the telecommunications industry, "interconnection" refers to the establishment of electronic linkages between service providers so that they can conduct business transactions electronically. In short, interconnection is e-commerce or business-to-business trading between and among carriers.
Overview
In a competitive marketplace, there are a number of reasons why service providers need to interconnect with each other:
- New entrants need access to the networks of incumbents so that they can resell services.
- Competitive voice, data, and wireless carriers need access to "last mile" facilities to deliver services to end users.
- All carriers need access to each other's back-office systems to fulfill number portability mandates and to exchange the forms and messages involved in fulfilling customer orders.
Thus, in the telecom industry, interconnection or e-commerce is not just a way to make business relations easier. It is, literally, the key to competition. Without those linkages, competition would simply not be possible.
On a national level, interconnection is complicated enough, involving a tangled web of relationships among different types of providers. Interconnection on a global scale is further complicated by diverse languages, cultures, markets, regulatory environments, and technical idiosyncrasies. That's why the "technique" used to achieve interconnection is all-important. That technique becomes either the facilitator of or obstacle to competition and the spread of communications services around the world.
This tutorial will clarify the business case for global interconnection by explaining the evolution of interconnection in the United States, identifying the global drivers of interconnection, explaining how an interconnection clearinghouse works and why it is the most flexible and workable approach, illustrating how interconnection with and without a clearinghouse works for actual companies, and describing a practical vision for achieving interconnection on a global scale.
