Traditionally, e-mail messages have had to flow through the United States even when the message is sent to a bordering country. That means high Internet access costs for foreign countries. "The rest of the world pays the tab for connectivity to the U.S.," said Winokur. That's changing, he said, because Internet access providers are starting to build backbones and Internet "points of presence" or "POP" all over the world. Europe and the Pacific Rim are especially desirable targets right now.
Having a global presence is becoming more important for Internet companies. First, international companies on the whole have a better reputation for seamless Internet connectivity. But more points of presence also mean the company has a much larger potential customer base and may be able to charge less than its competitors. The competition for Internet access providers is continuously increasing; industry experts predict that out of 2,000 providers today, only 100 to 200 will survive.
Internet companies are also finding that fax is a great global business. "Fax represents 50 percent of the current international telecom traffic," said John Sidgmore, president of the Internet access provider UUnet Technologies Inc., Fairfax, Va., which has formed strategic partnerships with several international Internet companies. One of UUnet's primary competitors, PSInet, Herndon, Va., recently rolled out an international fax service. "[We want businesses] to choose PSInet as their virtual global printer," said Chuck Davin, chief technology officer at PSInet. International Web hosting will be another market for the Internet access company. Some global plans will probably include partnerships in such areas as Asia and Europe, said Pete Wills, COO of PSInet. "We're talking to a lot of people about expansion plans,"he said.
The United States still accounts for 73 percent of worldwide Internet users, according to the Georgia Institute of Technology. Four countries - Japan, Germany, the United Kingdom and France - comprise 92 percent of Internet users outside the United States, according to the market research firm Simba International, Stamford, Conn.
Internet telephony, in which individuals and businesses can use the Internet to make cheaper international calls, is a main motivation for global companies to build their own Internet connections.
Long distance telcos are particularly interested in Internet telephony because it would let them avoid paying local telephone companies an access charge.
Some international long distance companies, said Winokur, might entirely abandon the technology of circuit switches for Internet protocol, which uses packet switching.
Internet telephony "represents our entire strategy of voice and data," said John Scarborough, Washington-based MCI Communications Corp.'s Internet strategist. Scarborough said that MCI is separately building voice and data networks that will eventually be combined.
While Winokur points out that there is still a significant imbalance in how much other countries pay for Internet use and how many World Wide Web sites are written in languages other than English. But the fast-changing Internet business and the need to be global may soon balance things out.
