Attack and counterattack, ashes to ashes
Telecommunications – or ICT, information and communications technology, it makes little difference nowadays – is spinning off in so many directions it is hard to find a fixed point, fixed opinions, fixed strategy.
If convergence is the technological vision of the moment, divergence is the commercial philosophy. Convergence says, ‘your turf is my turf’, but marketing says, ‘my turf is my turf too’. Telephone operators – both fixed and mobile – hustle and tussle to offer cable services and broadband, cable operators to provide telephony and broadband, and ISPs are trying to pull up to the pack by offering voice and video. Of course, all this is in the most unbrotherly spirit of ‘love’. Who would have thought so much divergence would come of convergence?
Regulators are trying to sort out the questions this raises. Should we give free reign to technology to benefit the consumer? How much freedom can we give and still maintain a healthy industry? What is healthy competition and what is unhealthy? What are the political ramifications of the choice? What sort of intellectual property questions should they address and how? Regulators face a long series of decisions, of dilemmas, few of them easy or clear-cut. As Vivian Reding, the EU Commissioner for Information Society and Media, said when speaking of just one of the regulatory questions, choosing the wrong standards could drive economies into long periods of economic underperformance.
Regulators are trying to figure out how to open-up the traditional box – how to guide, more than regulate, the technologies and services that are not anywhere as fixed and self dependant as we once thought. It is incredibly difficult to chart the right course. Ms Reding proposed open standards, even competition between open standards. She is probably right. As it is for so many issues, perhaps open commercial competition is the quickest – albeit bloodiest – way to resolve the issues. There seems to be a growing consensus that regulators might serve best as guides and referees channelling competition in the interests of the public and limiting the bloodshed.
Companies, especially service providers and operators are also trying to sort out the questions convergence raises, but at a different level. The view from their trenches must be somewhat disheartening at first glance. It’s a big battle, and no one really sees more than a piece of the action. Attack and counterattack are the order of the day. Operators seek to add value to their services and undercut the emerging competition by capitalising upon their heritage, the skills they have honed since birth, and the advantages inherent in being the owner of the network. Cable providers and ISPs have their specialties and advantages as well. Still, as the technology masters, the hardware and software providers, work to beat their own competition, they inevitably upset the service providers’ carefully planned strategies and blow their tactics to shreds.
IPTV threatens cable, VoIP threatens operators, and new technology threatens ISPs. Opinions vary, but some industry observers believe that IP video will rule the development of the network in the coming years. These observers think the cable companies with their high-bandwidth, made for TV, infrastructure have an edge, ‘they’ll bury the telcos’. On the other hand, the telcos have the networks and experience built through the years, and even if they don’t always bring fibre into the home they get it close enough to count. IPTV, or TelcoTV, since it transmits only the channel the subscriber tunes into, doesn’t need the bandwidth of the cable companies that transmit all their channels at once. The telcos, too, have a natural advantage handling the big spending business customers – they ‘see’ the whole network and can manage security, applications and, often, devices throughout a client’s entire network. The bigger operators can manage a client’s communications worldwide.
And so they go, claim and counterclaim, example and counter example, on and on, world without end.
Wireless, also – mobile GSM, CDMA, 2.5G, 3G, 3.5G, Good G..! WiFi, WiMAX, WiWhat? and WiWhy? – competes technology against technology, wireless against fixed. Once again, the drone of claim and counterclaim fills the air. Who will win? It’s hard to say, the jury is out as far as the competition between the service providers. The consumer will win and, just as certainly, the hardware and software providers that are spinning the sector around by its power cord. The traditional models are falling rapidly into the fire, I’m waiting to see what arises from the ashes.
Connect-World: Asia-Pacific I (2007) will be published later this month. This edition of Connect-World will be widely distributed to our reader base and, as well, at shows where we are media sponsors such as: PTC (14-17 January 2007, Hawaii), Carriers World (13-15 March 2007, Hong Kong), CommunicAsia (19-22 June 2007, Singapore), and PTC/User World event 2007 Americas (dates to be announced).In addition to our normal global mailing, this issue will also be distributed to a select list of world leaders, to the ranking executives of the world’s largest companies including the Fortune 1000, to government authorities, and to international institutions. This issue will also be available on our website to all other interested readers throughout the world.
The theme of Connect-World: Asia-Pacific I (2007), our coming edition will be Next generation strategies – a look at the new environment.
The changes brought by today’s information and communication technologies have unsettled the sectors involved and raised a series of profound questions that policy makers and regulators throughout the world are struggling to deal with. Business users are finding that buying technology and learning to use it is just the first step; to really take advantage of the new technologies and tackle the competition they often have to re-invent their processes, systems and products – even the corporate culture and the company itself. Governments and institutions, like businesses, have to re-think their systems and services in terms of what the new technologies can do, but the payoff in better services, greater efficiency and reduced costs can quickly re-pay the effort. The new technology is infiltrating itself into the daily lives of people in the world’s great cities and in its remotest reaches, bringing basic communications, entertainment and new life-changing educational, medical and business services.
In the sector itself, the changes are profound. Manufacturers, systems developers, content providers, distributors, operators, carriers; each and everyone in the sector is feeling the change. New business models, new partners, new marketing and new competition are the rule.