EARTHQUAKE LESSONS
Taiwan’s earthquake reveals a digital divide
By Cesar Bacani

What catastrophe? Kevin Lodge, head of Asia Pacific Customer Services at Swift (Society for Worldwide Interbank Financial Telecommunication), was unfazed when he learned in December that an earthquake had severed subsea cables off Taiwan. He was confident that Swift’s 8,000 or so banking and corporate clients around the world would be able to send and receive their usual 11m electronic messages a day without a hitch. “And I was right,” says Lodge. “Our system was not affected at all.”

Not everyone fared so well. Especially hard hit were those wired through the legacy technology known as ATM/FR (asynchronous transfer mode/frame relay). “Non-IP based systems like leased lines and ATM don’t have the kind of flexibility that you find in IP-based services,” explains Claus Mortensen, research manager of Asia Pacific communications at technology research organization IDC. They send their data via the shortest path between two points and cannot re-route easily when that particular cable is severed.

Indeed, the Taiwan quake revealed a digital divide that still exists in Asia, between those that communicate via an IP (internet protocol)-based technology on one side, and those that use non-IP systems on the other.

A surprising number of companies still use the old technology. “We’ve been migrating customers to IP, but about 35% of them are still on ATM/FR,” says Allen Ma, president of BT Asia Pacific. They include price-sensitive ISPs that buy bandwidth in bulk for resale to businesses and individual users. Cost is not the only issue. Some IT departments maintain that ATM is more stable than IP, since data is sent directly from end to end, not broken down into packets, routed separately and then reconstituted at the destination. And not every company needs to be online all the time. “People in many Asian countries are used to disruptions in communications,” says Mortensen.

Still, the Taiwan quake has many organizations asking whether they are on the right side of the digital divide. The question matters most for any business that can’t survive without instant and always-on communications, suggests Mortensen. In particular, financial institutions, logistics companies, global manufacturers, Asia-headquartered conglomerates, and multinationals should take a closer look at their communications systems. “It’s a matter of signing up with a service provider that can assure you it has back-up and redundancy systems,” says Mortensen, “somebody who is able to re-route traffic in case one of the cables break down, which is usually in favor of IP-based technology.”

Not surprisingly, BT, AT&T, and other service providers are looking to capitalize on the cable problem to grow market share. “This is the biggest cable disaster I’ve seen in my 30 years in this business,” says BT’s Ma. “This should send a signal to legacy customers to move to MPLS” – that’s multiprotocol label switching, an IP-based network system that BT developed with router industry leader Cisco.

Swift, which uses BT as one of its service providers, also hopes to sign up new clients. It is trying out SwiftNet Mail, a new email service to complement its core messaging offering. “When you look at what happened on the internet, where there has been a bit of a muddle for a few days, certainly this would have been an instance, from the resiliency point of view, where SwiftNet Mail would have been seamless,” says Brian Haughan, head of Swift’s customer operations division.

But beware. Not all IP-based service providers are created equal. Before the quake, telcos and ISPs swore up and down that they had back-up systems and other contingency plans to prevent disruptions. It turned out that the business continuity agreements some had with the cable companies were not firm – it took days before they were allocated bandwidth on alternative cables.

Swift’s Lodge says its service providers – AT&T, Orange Equant, BT Infonet, and Colt – performed as promised. But, as a major customer, Swift enjoyed priority. How high you are on a provider’s totem pole, as measured by the level of service you signed up for, is yet another factor in surviving a future cable crisis.