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Application Killers

What needs to be done to pull the telecom industry out of the doldrums?

Is it just a case of developing better technology, or getting service providers to automate their business processes? These initiatives would certainly help, but I think something else is also needed – namely, some fresh thinking on the part of content providers.

Content providers are being very shortsighted about the Internet right now. Rather than looking for innovative ways in which they can use it to help their businesses grow, they’re treating it as a threat and trying to halt developments in their tracks. Case in point: They’re trying to defend the copyrights of the films and music they produce – and although that may sound like a perfectly reasonable thing to do (and they’ve won a few legal battles so far) there’s no doubt in my mind that they’re going to lose out in the long run.

Why's that? Because stopping breach of copyright on the Internet is practically impossible, as I hope to demonstrate in this column. It’s like King Canute trying to hold back a rising tide. It can’t be done, and content providers would be much better off recognizing this and finding ways to exploit the Internet, rather than fighting vainly against it.

To read the rest of the column, please go to: Service Provider Circle. — Geoff Bennett is Director of Light Reading's Training Division.
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dwdm2 12/5/2012 | 12:55:30 AM
re: Application Killers Hello Geoff, welcome! Good article. How things with Marconi (are you still with them? just curious).

About the article: this is surely one way of looking at revenue generating applications. I guess I didn't read it very carefully, but what are some of the down sides?
Holy Grail 12/5/2012 | 12:55:19 AM
re: Application Killers
To my mind this issue is all about if or how Telecom operators enter the recording industry value chain.

Right now the vast majority of the recording industry does not include Telecoms in the value chain.

If Telecoms companies had the money and expertise to offer budding recording artists decent long term contracts combined with an ability to promote their material, and they could profitably deliver the recorded material to 98% of the artists available market, then they could perhaps cut the record companies and the record stores out of the loop.

There are however a lot of ifs here, at the end of the day you might just be cutting the fat out of the recording industry to service the debts in Telecom!
gbennett 12/5/2012 | 12:55:19 AM
re: Application Killers Hi dwdm2,

I joined LR in September to help set up our new training division. We launch this month, so watch for news on the main site.

I'd be happy to comment on my private opinions of Marconi if you'd like to drop me an email at [email protected] For those of you who like to read between the lines, I don't have anything bitter and twisted to say :-) I actually think Marconi is comparatively well set up.

I assume your question is "what are the downsides for the music industry if they embrace the Internet as a new route to market?".

In that case the risks are pretty mush the same as with any new venture like this. Did you know that Thomas Edison was sued by the producers of sheet music when his company released the first recordings?

People thought that radio would kill the record business, when in fact it acted as a major advertising and promotional vehicle and record sales soared.

Going back further, the first public lending libraries were criticised because publishers thought that people would stop buying books.

There are countless other examples in copyright history, and I'm hoping to explore some of them in a longer article about this topic.

But if we look at the music industry in particular, the risk is that they'll have to dismantle the bloated structure of "marketing", "promotional", "A&R", and other jobs that don't contribute to the quality of the final product. The artist may get something like 8 cents per copy of a record sold. So why do we have to pay over 200 times this for the privilage of owning it? There's a ton of fat to be trimmed from this industry, but the fat is the part of the industry with the power.

Cheers,
Geoff Bennett
Director, Light Reading University
pdt 12/5/2012 | 12:55:19 AM
re: Application Killers Why should swap free downloads from kazaa for pay service?

How can legal service from Sony that cost money compete with free service?
gbennett 12/5/2012 | 12:55:18 AM
re: Application Killers Holy Grail,

I've always been puzzled when I see presentations that say "content is the key", or something like this. As you point out, if content providers somehow manage to charge the subscriber for their services, how does this money filter back to the bandwidth provider who has to fund the infrastructure rollout?

The only link I can see today is that the availability of free music and movies is an incentive for me to upgrade my home connection from dial-up to ADSL. That's a big increase in revenue for both the line provider and the ISP (ISPs charge more for broadband connectivity than dial-up).

As far as your comments about restructuring the music industry go...they sound perfectly sensible to an outsider, but I suspect they go against decades of entrenched custom and practice.

So little of the money we pay for CDs actually goes to the original artist, it's crazy. There are lots of middle-man (sorry, person) vested interests in this particular value chain.

Cheers,
Geoff

gbennett 12/5/2012 | 12:55:18 AM
re: Application Killers "Why should swap free downloads from kazaa for pay service?"

One reason is that these services are currently breaking copyright law. Call me a bluff old traditionalist, but I don't see a way to legalise these services unless it involves payment by the person downloading the content.

"How can legal service from Sony that cost money compete with free service?"

That's the big question. Right now, Sony charges $1.49 per track, which I do not think is competitive. It's clear that this price is pitched at protecting their current "album-oriented" sales model.

Cheers,
Geoff

cyber_techy 12/5/2012 | 12:55:06 AM
re: Application Killers Instead of complaining of lack of bandwidth intensive killer apps that can create jobs for techies, I have the following suggestion for people who have unmetered DSL or Cable.

Go to your favourite search engine
Enter streaming video in search box
Click on any 24 hour TV and select the highest b/w. I use 300 kb/s

You don't need to be sitting in front of your PC but you'll be contributing to driving traffic on the internet (and increasing your chances of getting a job) at no cost to you.


dwdm2 12/5/2012 | 12:55:06 AM
re: Application Killers Geoff, thanks for the clarifications. I agree with all the "cultural" aspects you've pointed out. IMHO, cultural change is often secondary, at this age it is primarily driven by technology and the advantages (both moral and economical within the social parameters) it offers. So, from this point of view, we need appropriate technology deployment to "make it happen," i.e., adequate delivery mechanism.

Like many others, I am convinced that fiber has the potential to solve the delivery problem, but for whatever reasons, deployment of FTTx is not progressing enough. This is what I wanted to imply by downside.

On a lighter note, how come your messages do not show the LR insignia but just the regular ones like the readers?

Cheers.
billyjoebob 12/5/2012 | 12:55:05 AM
re: Application Killers "Go to your favourite search engine
Enter streaming video in search box
Click on any 24 hour TV and select the highest b/w. I use 300 kb/s"

The most likely reaction to this strategy will be the cable companies imposing fees on types of traffic (such as streaming audio and video) or heavy traffic users. Face it - if they become a monopoly for high speed IA - the easier and more profitable way to manage bandwidth usage is to incrementally raise rates to keep usage at a functionally acceptable level.

Without a competitive alternative they won't invest heavily unless performance, similar to existing voice parameters, is regulated and mandated.
cyber_techy 12/5/2012 | 12:55:04 AM
re: Application Killers The most likely reaction to this strategy will be the cable companies imposing fees on types of traffic (such as streaming audio and video) or heavy traffic users. Face it - if they become a monopoly for high speed IA - the easier and more profitable way to manage bandwidth usage is to incrementally raise rates to keep usage at a functionally acceptable level.
================================================
If they want to differentiate type of service, they will have to buy equipment that has the QoS feature (more jobs!). Most providers won't have this capability for atleast one year, even if they started today. In any case, if I have to choose between paying $10 a month extra for my DSL and a $100,000 job, I will go for the latter.
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