Improving services, cutting costs and winning jobs through ATM strategy

One forward-thinking local authority has transformed its IT department from a cost centre into a revenue generator, opening the door to a massive improvement in ICT infrastructure and services - whose benefits have been felt not only within its own community but also by people far beyond its own borders - creating jobs and employment skills throughout the North-East of England. Crucial to the success of this transition has been the selection of ATM technology, which has made it possible to achieve major cost savings and improve facilities even more.

Derwentside District Council in rural West Durham might not seem the most likely choice as the starting point for an IT revolution but that is just what it has proved to be, emerging as the first council in the UK to become an Internet Service Provider, the driving force behind the first online Job Centre in the UK, a pioneer of various now-nationally adopted services and a widely respected IT consultancy.

As with all revolutions, things started off in a very quiet way. The seed was the portentous realisation by Allan Hodgson, Director of Corporate and Community Development, that the development of an ATM, fibre-optic based solution offered a brilliant way for the council to achieve its technical service and community development ambitions.  “I realised that this technology was what we needed to create a wide area network - and in fact a LAN within the council - because you can run voice, video and data across the network, without any major problems, and guarantee the quality and delivery of service.”

Unemployment and deprivation are strong features of this region whose past was based on industries such as coal mining, iron and steel production and engineering.

For many years, an important part of the council’s remit, therefore, has been to try and raise the quality of life for local people – especially by improving skills and employment opportunities in the area.

So, when an engineering company in a nearby town wanted to open a satellite factory in Derwentside the council became very interested and got deeply involved in making sure that the kind of broadband telecommunications infrastructure needed to clinch the deal was put in place.

The major Telco in the region was not able to meet these broadband requirements at the time and so Derwentside negotiated an agreement with Telewest, a company that was primarily involved in the provision of cable TV plus telephony services in a neighbouring area to extend its fibre optic cable network into Derwentside.

“As part of the project we got a full ATM implementation using ASX200 ATM switching equipment from Fore Systems, part of Marconi, who were the leaders in ATM technology in our view.” Allan Hodgson explained.

That small satellite factory has grown enormously since then and will soon be supporting 1,000 jobs – thanks in no small measure to the things made possible by various local authority ICT initiatives– particularly with the Internet.

Based on this fibre optic connectivity, the council set about developing its new broadband infrastructure and won grant aid to set up what it is now called the Derwentside Infonet.

The aim of the project was to raise IT awareness in Derwentside, enhance the skill levels of the local population and make the area more attractive for business investment.

It linked a wide variety of local organizations and gave them “free” Internet access. One of the early participants was the Job Centre in Consett, which became the first online Job Centre in the country. National government was fascinated by the idea, a Minister performed the official opening and there is now a national policy to put all Job Centres online.

The Derwentside Infonet proved to be a pioneering development in other ways too. The council decided to be its own ISP, recognizing the cost savings and revenue potential. In return for a fixed annual fee subscribers were given unlimited “free” access to the Internet. Although this approach is now widely adopted by ISPs in the UK, it was an unusual and daring concept at that time.

The success of the Infonet is demonstrated by the fact that the number of subscribers has grown from 20 to several hundred.

At the heart of this service lies the broadband communications infrastructure supplied by FORE Systems/Marconi. By using the communications infrastructure to integrate services information onto a cohesive district lnfonet, it has been possible for Derwentside to deliver cost savings and improve the level of service offered to the business and residential communities. The network consists of a number of interconnected fibre optic trunks supporting local towns and villages.

The Infonet not only generated savings and revenue but it also developed skills and made it possible for the council win grant aid for a number of other infrastructure developments, including the creation of a £1m Business Centre in Consett, a regional backbone and the extension of broadband into more rural areas.

For the business centre, the council was obliged, as part of the grant conditions, to select and install a showcase item of advanced equipment to attract SMEs and expose them to the latest ICT technology. As its showcase item, Derwentside decided to install a state of the art IP or network-based telephony system.

“We had a look at equipment from all the major suppliers, including Cisco and Alcatel, but basically they all got a bit complicated, very expensive and there were an awful lot of issues with them,” said Allan Hodgson. “We reached the stage where we were not going to bother because we felt we could not afford it and there were too many technical complications, when we came across a new product, from Marconi, called Spericall.

“We got a hold of some of the Sphericall equipment, installed it very quickly and it worked. It was very simple and most importantly they had quite an installed base in America as well as at Marconi and DERA in UK.

“The proof of the pudding was when they brought the kit up. My team had it installed, configured and working within two hours and running telephony across the net  - and high quality telephony as well.

“We have been so impressed with it that we have now decided to replace the council’s own telephony system with this. It's not just LAN based telephony – the sophistication of it is amazing. It links beautifully with desktop PCs. 

“You do not have to use the computer to answer the phone but when you answer the phone you get a screen pop up straightway telling you who is calling you and you can do a variety of things with it. Basically every computer is a switchboard.

“There is also a layer of software which provides unified messaging and it really is true unified messaging. So in your email queue, for instance, you can also see voicemails and faxes and if you double click on your email queue it plays out messages through your speakers – or, if you have not got speakers, you can direct it to your phone.

“Faxing at every desktop and other things that we could not afford to have with the old system we will now be able to provide for everybody. It is very easy to deliver this kind of telephony anywhere on our WAN because it is an ATM based network.”

Most small and medium sized government facilities in the area used a Centrex service that provides a basic POTS service with a succinct list of features and facilities. Sphericall, however, has allowed the district to cut costs - by removing the recurring bill from their Telco – and generate revenue by providing services that would have been provided by their Telco. It’s a elegant cost effective solution for an organisation to replace costly PBXs.

One of the council’s latest ICT ventures has been in support of the e-Business Foundations project – a £4m programme sponsored by the North xxxx (NIA) – which involves the creation of e-Business incubators in seven towns and cities across the North-East of England. Derwentside was not only selected as the site for one of these incubators but it also won a contract in competition with major Telcos to provides the service and support for all seven centres.

As a result of the ICT expertise that Derwentside has built up in these and other projects, it has come to be regarded as a technology leader in its region and has been approached by neighbouring local authorities to provide them with Internet access and other ICT services. It now serves almost 100,000 email addresses and has developed a stream of revenue as a consultancy and services team - and that has made further technical investments possible.

Describing the many benefits of its ICT investments, Allan Hodgson said, “The infrastructure that we have procured has enabled us to improve our IT systems for no additional cost. Allowing for inflation, our telecom services actually cost us no more money than they did six years ago.

“In addition, we have generated a surplus, and it is that surplus which has paid for the expansion of the IT services team and the salaries of our community development team. It has also created employment in the area.  As a local authority, how do you put a price on getting a new factory that ultimately creates up to a thousand jobs? In a way what we have done is procured ourselves a first class telecom infrastructure for no more money than we were spending previously.” 

This network continues to be expanded, using Marconi solutions - as the council pursues its strategy of making sure that Derwentside remains at the forefront with modern cost-effective technology.