Iristel inks deal with MTS for inexpensive network backhaul system

With telcos around the world looking for ways to cut operating costs during what may turn out to be a protracted economic downturn, Toronto-based Iristel Inc. has developed a solution that will enable Canadian incumbents and competitive providers to backhaul their wholesale international traffic more cost effectively. Speaking with Network Letter this week, Iristel’s president and CEO Samer Bishay says the company’s solution could save incumbent and competitive local exchange carriers (ILECS and CLECs) about 30% in wholesale traffic backhaul costs, and when combined with the time saved in provisioning capacity, the reduction in expenses could even be higher. Calling China may cost $0.02 per minute today, but it could drop to $0.015 tomorrow, he says, highlighting the importance of being able to move quickly to provision capacity. “So if you don’t maximize on the opportunity now you’re losing out on a lot more than just the 30% savings on the backhaul,” Bishay tells Network Letter. “Everything together, there are significant savings and it’s much more than the 30% when you total everything up.” Currently the large incumbent and competitive providers deploy points of presence in New York where they interconnect with a third party to convert their conventional TDM traffic to IP. According to Bishay, this amounts to a significant expense for network backhaul, regardless of whether these circuits are being used. As well, the time it takes to provision additional capacity can be anywhere from three weeks to a month. Iristel’s system brings the TDM to IP conversion process inside carriers’ infrastructure, which significantly reduces leasing costs and time to provision capacity. “So instead of backhauling this capacity to New York, just takes it a couple of feet away from their switch into our equipment,” Bishay explains, dubbing it a “headache free solution” for carriers. “Turn up time is reduced from roughly three weeks to something like two days because it’s all virtual. The connection is done prior to the fact and then we just turn up circuits virtually.” The company has already inked agreements with carriers in Europe, and signed its first deal with a Canadian carrier late last month. MTS Allstream Inc. is using the Iristel system to convert its conventional TDM traffic to IP without having to sign costly IP interconnection agreements with a third-party located in New York City. Other CLECs and ILECs in Canada are kicking the tires of Iristel’s system. “We’re in discussions right now to see because everybody has the same problem backhaul capacity and there’s no made-in-Canada type solution. I think ours is pretty much the first the made-in-Canada type solution on this level,” Bishay says. With the economy still seemingly in a free fall, he says Iristel’s system couldn’t have come at a better time as companies struggle to keep costs in check. “Not just the money savings, but the time savings are significant in terms of provisioning and getting to market because in this telecom business, it’s time to market. It’s essential, especially for wholesale business.”

Iristel inks deal with MTS for inexpensive network backhaul system

News | March 5, 2009

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