CS3260 Tutorial 4    -    (week Sep 15-19)

4A. Singtel (http://www.singtel.com.sg) offers an international ISDN-2 service which carries 2 ISDN B-channels (64 kbps each).  The subscription price per month is S$ 15 (for both channels), and the local data traffic is 1.8 cents per minute per channel.  If the channels are used for voice communications, then the rate is 1.4 cents per minute per channel.  The additional tariff on data and voice traffic to the U.S. are S$0.95 and S$0.39 per minute per channel respectively.

a) KaiLung.com needs to make calls and send data to the U.S. headquarter periodically.  Suppose the price for a leased circuit from Singapore to the U.S. is the same as in Question 4B, and it can be used for both voice and data traffics.  For what quantity of data transmission per month is it cheaper to rent the leased circuit (assuming no voice calls)?  Similarly, for what volume of voice calls is it cheaper to rent the leased circuit (assuming no data traffics)?

b) Based on company records, on average, the ratio of voice-data traffic to the U.S. is roughly 1 minute to 15 kb of data.  For what volume of the combined voice/data traffics per month is it cheaper to rent the leased circuit? 

c) Singtel also has an alternative international ISDN-30 service, which provides 30 B-channels (64 kbps each) at a monthly subscription of $360.  The usage charges per channel are the same as above.  Under what circumstances would KaiLung.com prefer this service over ISDN-2?

4B. The prices of telecommunications and media services can be set on several bases, including connection, usage time, distance of transmission, and quantity of information transmitted. Consider the following charges (in Singapore dollars) for 64kbps X.25 packet-switched data service and a 64kbps leased circuit between Singapore and New York. (In practice, international telecommunications services are typically sold in two parts – by service providers at the two ends. For instance, for a leased circuit between Singapore and New York, it is necessary to buy a “half-circuit” from a Singapore provider and another “half-circuit” from an American provider. Further, the subscriber needs to pay a monthly fee to connect to the local provider's point of presence.  For this question, please focus on the prices paid to the Singapore provider.)

X.25 64kbps Datalink (in Singapore dollars)

monthly charge                                                            $ 700

Data charge (64 byte segment)

                                            local                                 $ 0.0008 / segment

                                            international                    $ 0.015 / segment

Duration charge

                                            local                                 $ 0.01 / minute

                                            International                    $ 0.20 / minute

64kbps Leased Circuit (in Singapore dollars)

Local                                                                            $   240 / month

International                                                                $ 5,200 / month

a) For what quantity of data transmission per month is it cheaper to rent the leased circuit? From an end-user’s viewpoint, which one has higher scale economies in data transmission?  

b) Explain why the usage charges for voice telephony tend to be based on duration time, while those for X.25 packet-switched services are based on the quantity of information transmitted and duration time.