I notice that you haven't mentioned when you last used HiPE, nor have you mentioned what was unstable about it when you used it. I also notice that you haven't offered any sort of detailed description of or link to the OTP port that you saw some time ago. I'm genuinely interested in all of these things.
Every single time I have heard of "network transparency", whether it was from the Project Athena documentation out of MIT, OpenGL tomes, or CORBA programmer's guides, the author has said something to the effect of:
"Network transparency means that -to client code- access of local resources appears to be identical to access of remote resources; client code doesn't have to care where a resource is. However, access of non-local resources is bound to be slower (often substantially slower) than access of local resources. Be aware when writing performance critical code!"
Everything I've read defines network transparency in this way. Everyone I've talked to knows this definition and knows about its performance implications. Everyone I know who's not a freshly-minted web developer agrees that if you lack a certain level of experience, you have no business designing distributed systems. I'm not sure why you have such trouble with the term.
In regards to your VoIP service: Erlang/OTP provides battle-hardened monitoring, failover, exception handling, and the like. When you use Erlang, you don't have to write any of that, or fish for libraries of unknown quality to provide that functionality. That's one of the big things that's nice about the language and platform.
> Failure of the runtimes/VMs was never an issue...
Neither I, nor most folks who work with languages that run on a properly-developed VM often run into VM failures. If we did, we probably would stop using that particular faulty system. :)
> How is Erlang going to help with logic errors...
It helps by letting you write code only for the happy path. See my next comment.
> I don't see how crash and retry fixes the majority of bugs.
You might be confused about what it means to crash in Erlang. When you write Erlang, you code only for the cases that you must handle. This reduces the amount of code you must write and test. If a component of your software encounters unexpected or invalid input, or gets put into an unanticipated state, it crashes, the invalid state is lost, and the supervisor for that part of the system restarts the component. Folks sometimes talk about writing a crash-free error kernel [0] surrounded by code that dies when it runs into something unexpected.
Do you get this for free? Yes and no. The process supervision code is built in. The modular software design to take advantage of the supervisory stuff you must do for yourself. You would likely end up doing very similar design work regardless of what language or platform you used.
> ...the Linux kernel is pretty big and haven't people achieved high uptime with it? ... Is this an invalid comparison?
It probably is an invalid comparison. And yeah, Ericsson's engineering department is likely full of good, disciplined programmers. However, most tools (like Erlang/OTP) that improve programmer productivity will improve the productivity of all but the very, very weakest of programmers.
> Even the guys I know that use Erlang, all the heavy lifting is C. Erlang's just the signal plane.
Yeah. As I understand it, that's the general pattern for high-performance systems. If you have really serious performance needs for your robust distributed (or simply fault-tolerant) system, do some perf tests, write the performance-critical parts in C or C++ or whatever, then use an Erlang Port Driver (or maybe some IPC mechanism of some sort) to connect them to the more difficult or logically tricky bits that are written in Erlang.
As I understand it, this is how the software running the AXD301 was designed. If you have an hour or so, you might be interested in [1]. It's an Ericsson presentation on the design of the switch in question. Some of it is stuff you undoubtedly already know about, but much of it is probably not. If you're looking for more, any one of the papers from Joe Armstrong on the proper way to go about designing Erlang systems are always good reads.
> As far as I remember, the process distribution part ... [isn't] a secret magic perf sauce, is it?
It was written by programmers much like you and me so -no- it's not secret or magical. The protocol is even partially documented [2]. What's more, AFAICT noone claims that it's the source of serious performance gains. It is -however- reliable, and -I gather- well understood, and backed by an active, talented development team.
[0] http://learnyousomeerlang.com/building-applications-with-otp
[1] www.erlang.se/publications/Ulf_Wiger.pdf
[2] http://erlang.org/doc/apps/erts/erl_dist_protocol.html