It's Gut Check Time
And don't get anyone started on Quantile Regression Analysis, or you're likely to start a riot. (I'm not explaining that reference to the uninitiated, but JSI Capital Advisers does so here.)
This isn't a conference on regulation, however -- the point of this event is to focus on the potential of IP-based services and applications to help small independent telcos and cooperatives find new revenues to replace what they are losing.
The obvious question then is: Are these companies willing to risk further investment in their future, without the aid of federal subsidies, under clouds of regulatory uncertainty and no assurance of seeing a return on that investment?
In other words, can rural telcos live in the real world of business?
Their major vendors are pushing them in that direction. Companies such as Adtran Inc. (Nasdaq: ADTN), Calix Inc. (NYSE: CALX), CHR Solutions Inc. and Metaswitch Networks -- all of whom are big players in the small markets -- have a common mantra here, and that is this: It's riskier to stand still and not invest, than to push forward and take a chance on the future.
As Ray Carey, CEO of NeoNova Network Services Inc. , told a panel I moderated on cloud services, there are plenty of companies ready to step in and serve the business customers that independent telcos serve today -- Google (Nasdaq: GOOG) and Microsoft Corp. (Nasdaq: MSFT) are two -- but many of those customers would prefer to do business with the local firm, if they can.
If that local firm is more focused on cutting back -- eliminating employees, reducing network investments, ignoring new service possibilities -- the business will go elsewhere.
At least some folks here think that's just fine with the FCC: Washington wants to see greater efficiencies and that means consolidation of smaller companies into larger units with greater economies of scale.
So it will really come down to the telcos themselves. Survival is a possibility, but it's going to take more intestinal fortitude than what's already been required of these companies.
— Carol Wilson, Chief Editor, Events, Light Reading