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Poll: Bearish on Telecom Future?

Are you ready for the "boring" and "low-margin" future of telecom?

That's the grim prediction from 55 percent of Light Readers responding to the recent poll, The End Is Near?, which asked whether "the provision of telecom infrastructure will become a boring, low-margin business operated by utilities."

And that's just one of a few gloomy statements favored by an awful lot of the 115 respondents. This could get depressing.

Sixty-four percent of the poll takers think telephony revenues will become "insignificant" within 10 years. Indeed, thousands of circuit-switched voice accounts are canceled every day, and voice is increasingly becoming a feature, not a product. (See ViaTalk Offers Free Year.)

Service providers expect to make up for lost telephony revenues with new broadband services, such as Internet TV or the application of quality of service (QOS), and on these topics, readers split almost evenly. A slim majority (54 percent) agreed that "TV over the public Internet will be huge, but telecom operators won't make serious money out of it." (See 2006 Top Ten: Emerging Trends and Yahoo Yells for Internet TV.)

As for serving up QOS, 47 percent say it's just "wishful thinking" for telecom operators. The rest, apparently, see a ray of hope in QOS. (See AT&T Sets Up Internet Tollbooths and Qwest CEO: SLAs Are A-OK.)

If everything's so bad, the Monkey asks, why did telecom stocks make such a strong showing in 2006? Thirty-nine percent of our poll takers say 2006 looked good only because 2005 was so bad. On a brighter note, 27 percent say the 2006 stock prices show that telecom has a bright long-term future, and investors know it. (See Stock Rantings.)

When we really took the gloom and doom to an extreme, readers cheered up a bit. Only 18 percent agreed with our statement that most of today's incumbent telcos will go out of business within 10 years. (See FTTH Hits Mainstream.)

And 63 percent disagreed with the suggestion that most folks in telecom will lose their jobs in the next 10 years. Still, the fact that more than a third agreed with that statement betrays some pessimism among telecom pros. (See Poll: Lucent Faces Bigger Cull and AT&T Adds 2,000.)

Since things can't possibly be as bad as our results suggest so far (fingers crossed), we'll leave this poll up for a few more days. If you haven't already, please take the poll and tell us everything's going to be OK -- or not.

— Mark Sullivan, Reporter, Light Reading

DCITDave 12/5/2012 | 3:16:26 PM
re: Poll: Bearish on Telecom Future? re: "Simple yes-no questions limit the answers you will get."

There aren't very many good polls with essay questions, either.

ph
Pete Baldwin 12/5/2012 | 3:16:26 PM
re: Poll: Bearish on Telecom Future? That's true about simple questions, but you still get some interesting results. The idea of telcos being gone in 10 years got 18 "yes" votes; I was expecting more like, you know, zero.

I'd love it if some of the "yes" voters would elaborate here; there's some good discussion to be had on what happens to service providers in the next 10 years -- and whether that spells doom for the telcos as we know them.
materialgirl 12/5/2012 | 3:16:26 PM
re: Poll: Bearish on Telecom Future? Simple yes-no questions limit the answers you will get. For instance, will telcos be gone in 10 years? (#5). Of course not. They will, however, probably not survive in recognizable form. Perhaps a better question is "what will telcos look like in 10 years"?

Telco stocks are up because of consolidation. The re-monopolization of telecom in the US has surpassed anyone's imagination (other than Ed Whitacre and his FCC cronies). While bad for customers looking for affordable bandwidth and good service, and bad for next-gen equipment makers whose wares will now have to be sold overseas only, as well as being bad for the general economy, it is good for Ed and his friends. The feds like it because it is easier to snoop.

A monopoly can hike rates and offer little in return. Nice business if you can get it. This is why ATT is getting so big, and why the stocks are up.

toast66612 12/5/2012 | 3:16:24 PM
re: Poll: Bearish on Telecom Future? Forget VOIP service providers and FTTH stuff. Telcom is poised for a big boom 2 years from now. Once more PBX solutions manufactuers go to a more open system design meathod demonstrated by companies like Shoretel, then large enterprises will upgrade due to cheaper infrastructure costs. I also think that what ever standards group created the S.I.P. protocol must rename it with a catchy easy to remember name. S.I.P. could be a HUGE boon to the industry since it allows PBX hardware to be interoperatable between vendors. This SIP standard could finnally end the high priced parts replacment problem that plaques the industry now. Nortel's pricing has always been pricey because they know you will have to buy all replacement handsets from Nortel since only Nortel handsets are compatible with Nortel systems, but using SIP with Nortel PBX systems you can choose to pay hundreds of bucks per Nortel handset units or a hundred buck per unit from a third party. This will boost PBX system replacement in almost all industries and business sizes.
spooble 12/5/2012 | 3:16:23 PM
re: Poll: Bearish on Telecom Future? Despite all the "content is king" and "being the pipeline is not enough" speeches, I don't see telcos actually preparing to *add value* as content distribution channels.

Ask a telco exec about the detail of their ad-insertion strategy. Or, about their ability to participate in (let alone lead) the promotion of a content property launch, e.g. a movie. Or how much leadtime their backoffice needs to structure a cross-product discounting and fulfillment scheme for a collection of related content (movie, soundtrack, ringtone, game, voucher for a toy, etc.).

It is instructive that in today's Brightcove article, telcos are not mentioned as potential competitors.
kentishman 12/5/2012 | 3:16:22 PM
re: Poll: Bearish on Telecom Future? I agree the backbone now needs revisiting as it wil become the bottleneck if network providers are not careful.

While working at home alone does have it downside it does enable me to participate more in the local community. And since I talk to work colleagues in Taiwan in the Morning and then San Jose in the Evening.

I do still have significant intereaction with my work coleagues. This is the beauty of a knowledge based economy. It knows no boundarys. That is why countries that try to restrict access to knowledge will eventually loose out to those who allow free access.
melao 12/5/2012 | 3:16:22 PM
re: Poll: Bearish on Telecom Future? I do agree that much of the work will be moved to the home. My only conern is that, if it is a good thing or not.
This means that for many positions, the company will have less costs in infrastucture maintenance, as the infrastructure will be at home.
Also, I think if yo uhave a good work enviroment, it is much more productive than working alone, by yourself at home.

Anyway, going back to the telecom future... I think the biggest point that the industry suffered was that the access did not grow as fast as the backbone. Now the access is demanding more bandwidth and this will demand a new rollout in the backbone.
I hope this time, the execs will drive the backbone growth by the access growth, and not the other way around.

kentishman 12/5/2012 | 3:16:22 PM
re: Poll: Bearish on Telecom Future? Surely Sophisticated and Reliable Telecommunication services are a significant part of the answer to the problem of Global Warming. In My experience as a home worker for nearly 3 years now and completely reliant on my communications systems which have gone from an ISDN line 128 kbit/s2003 to 512Kbit BB 2004 and now up to 8000 Kbit BB (actual speed 2800 kbit/s)in 2006.

I now have mobile phones with Integral WiFi that link to Wireless Hotspots (BT Openzone)and to my HomeHub that enable me to make 90% of my mobile calls over the Fixed network, and browse the web and read e-mail on the phone to.

My Business mileage has fallen from 2200 Miles per year in 2001 to less than 6,000 now as more of what I do uses communications.

Skype is there so that I can talk conference and generally work globally with the other parts of the business that are in Taiwan and in California San Jose.

Surely this is only the beginning of the home working revolution and as soon as more businesses and the people stuck in their Gas Guzzlers at traffic lights realise this. The sooner we can substantially reduce carbon emissions.
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