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Open is the Way to Go

8/26/2013
In an OTT world, network operators need to consider a different business model, accepting their physical networks as a commodity to sell.
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Carol Wilson
Carol Wilson
8/27/2013 | 10:14:02 AM
Re: don't forget about wireless networks
And while all us capitalists are out innovating, about 30% of Americans don't have broadband, because it isn't profitable to provide it. And the service providers who are trying to wring every last bit of cost out of their networks are seeing the innovation and resuslting dollars flow to OTT providers. 

A shared high-bandwidth network could reach more people because there are entities willing to subsidize its construction, as you can argue that Kansas City subsidized the Google Fiber network. 

And then the full range of service providers could still differentiate as you say - offering packages tying price to features that could include more bandwidth all the time, or more bandwidth when you want to watch a movie or play a game, or just a guaranteed QoS for whatever service you want to buy on a whim.

 
pzernik
pzernik
8/26/2013 | 9:19:22 PM
Re: don't forget about wireless networks
Remember we live in a capalist society and the US is still the inovation center of the world (so no worry there).  ARPU cannot rise forever, so it's now more about controling the end-to-end network and reducing the cost of delivering data (cost per GB) to the users.  Carriers need to differentiate and innovate and the way to do that is to bring costs down and offer tiered service plans with end-to-end Qualtity of Service (QOS) controls. The OTT innovators will likely have the upper hand introducing and monitizing innovative applications.
Carol Wilson
Carol Wilson
8/26/2013 | 5:19:10 PM
Re: Make it public!
That was kinda my point about the city of Austin and AT&T/Google. Rather than Austin giving away rights of way, power and even labor to Google (like Kansas City did), they should make AT&T and Google and whoever else wants in sit down and negotiate how to jointly build a kickass network and differentiate on services. Two networks makes NO sense. 
spc_isdnip
spc_isdnip
8/26/2013 | 3:23:38 PM
Makes too much sense
Carol, these companies (I'm mainly talking about AT&T and its fellow ILECs) live for monopoly control, and prefer it to profit.  They would rather they and their competitors die than play by sensible rules that would benefit consumers by allowing service competition on their monoply physical facilities.  The myth of facitliies-based competition is simply an excuse to keep out competition, since the economics of natural monopoly are every bit as bad as you suggest.

Look at how the Bells are losing wireline share to cable and wireless now.  They could have had competitors leasing their loops and innovating on the wireline plant, but instead they chiose to abandon a multi-billion-dollar asset.  Idiots all.
sam masud
sam masud
8/26/2013 | 2:15:07 PM
Make it public!
The network itself should be a public utility. Not as crazy as it sounds, and it would ensure that the network remains open.
Carol Wilson
Carol Wilson
8/26/2013 | 1:02:22 PM
Re: don't forget about wireless networks
It's interesting to see what the folks in Australia and New Zealand are doing, not to meantion the folks at Orange who are moving toward structural separation as well. 

But it's a trend that just doesn't seem to get any traction here and it's a shame. 
JohnMike
JohnMike
8/26/2013 | 12:59:43 PM
don't forget about wireless networks
Carol, your commentary is spot on!
Huge capital expenditures needed by new, innovative service providers to build networks that compete with the incumbents means that true competition will never be achieved expect among a very few large carriers.
We see this with the local telephone companies. We saw that with the CLECs and that's why so many of them failed, And we see that now in wireless.
Let the largest carriers build and operate the network infrastructure, while selling wholesale services to any comer willing to compete in the retail servcies market, including the incumbents own commercial divisions.
This approach gives customers the widest choice inn features and prices while breaking up the oligopoly.
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