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My Moment of Telecom Clarity

Have you ever had a moment of clarity? I'm talking about one of those moments alcoholics have (which I imagine typically manifests itself as the sudden realization that this "no drinking" thing is all a bit dull, really, before ordering themselves a nice big pint of scotch).

Well, I only mention it because I had one such epiphany-type moment recently at Huawei's Ultra Broadband Forum at the newly renovated and ever-so-swanky London Savoy Hotel.

It came during a keynote presentation, given by a kindly old Amish gentleman from Wired magazine (didn't catch his name because I was late, but his job title was "Chief Maverick, Wired magazine," which, let's be honest, is pretty much like printing "I'm A Giant Wanker" on your business card).

Wired's Chief Maverick, Kevin Kelly, fails to get the crowd techcited.
Wired's Chief Maverick, Kevin Kelly, fails to get the crowd techcited.

In any case, Albert Amish, or whatever his real name is, had two main points that he wanted to make:

  • The first was that he had advised Steven Spielberg on the movie Minority Report (talking of drinking, counting how many times he mentioned this would make quite a good drinking game, because he brought it up a lot -- really…).

  • The second was, broadly speaking, that there are a lot of amazing things happening in technology today (hurrah!), but not nearly as many as will happen in the future (oh no), but we don't really know what those things will be (why, how could we?!). But one thing is certain, they are definitely going to happen (no question!), because -- wait for it -- technology will find a way.)

    Well, I'm sorry, but that is not what I paid absolutely no money at all to Huawei (to attend its otherwise fabulous event) to hear. And judging by the reaction (somnolent) of the rest of the extremely senior crowd of telecom execs at the Savoy, neither had they.

    Because in one sense "Wired guy" had it right. If you're a telecom service provider, next-generation technology will find a way… to lose you billions of dollars and your job, if you're not careful.

    Essentially, Keynote Ken had made the fatal speaker error of not researching who he was talking to, and what makes them tick. And what telecom executives care about right now isn't the technology of the future, but the money of today, and how they can make more of it, from the technologies they are being asked to evaluate in the here and now, and including, of course, next-gen virtualization, or what we like to call The New IP. (Note: The second thing they care about, a lot, is security, but Mister Wired guy didn't talk about that either. Bad Maverick! Bad!!)

    Fortunately, Huawei's event soon recovered from its "keynot" irrelevance, with an absolutely cracking panel, hosted by Mark Newman, chief research officer at Ovum (which I thought was a fertility clinic, but turns out to have something to do with market research -- who knew?), with contributions from Alibaba, Telecom Italia, Hong Kong-based HKT (part of the PCCW Group), and Huawei.

    The panel focused, broadly, on the intersection of incumbent service providers and new OTT operators, how they are starting to work together, and why they might not be: You could see from the "lean in" reaction that this was clearly a hot button for the London audience.

    Now, I'm not just saying the panel was great because I was on it (though it's true that I'm awesome, obviously). No, what really made it pop was how the service providers on the panel provided a detailed financial context to their comments. Like, when Peng Ye, the VP from Alibaba, said his company's users don't care about bandwidth, and assume it's a "given," and what they care about is the quality of the products sold over that capacity, and how much they cost, I wanted to stand up and hug him. (But I didn't, because that would have been weird).

    So on the one hand you had Wired geezer getting excited about technology, and on the other you had these service provider front liners talking about how to make money. And that's what triggered my moment of clarity. Because as I see it the telecom world today divides neatly into two types of people (and companies).

    There are those who are excited about the technology -- let's call them the techcited, because we can -- and tend to skip over the gnarly details of how it serves the business.

    Then there are those who see it as a means to an end (making money).

    Unfortunately, I see a lot of the former "techcitement" these days around the subject of the Internet of Things (IoT), which I've taken to calling the Internet of Stuff (IoS) because currently everyone's talking about this "stuff" that, apparently, is a really big deal, yet no one can explain to me how service providers make money from it. And I do not want "stuff" -- I want (and service providers need) specifics.

    I mean, sure, Cisco's John Chambers thinks IoT (or Internet of Everything, as he calls it… way to add another superfluous acronym to the lexicon, John!) will create tons of data that will need lots of expensive router ports to direct it on its way, and he may be right. But that's going to be good for Cisco's bottom line at some point in the future, not Verizon's in the here and now. (Internet of Meh, anyone?)

    And yes, AT&T has a nice automotive IoT demo where you can tool around a virtual world while Google automagically highlights points of interest (Ruh-roh! There's Rolf hanging around outside the school gates again; better call the coppers) but I don’t know who will pay for that, or how much. The business model is, as they say, in absentia.

    My advice to service providers? Don't be a wanker. Or a maverick. Be a pragmatist, and a business person. Read your Light Reading daily; subscribe to Heavy Reading; talk to the other members of The New IP community. Because making money, pragmatically, for your business, is what this triptych of publications is all about.

    Oh, and one more thing: If you're interested in IoT, you might do worse than come to Heavy Reading's IoT conference in February 2015 in Atlanta. We've decided to focus it entirely on the money side of the equation, something that sets it apart from the other 20 or so IoT conferences next year. Expect to hear lots about using analytics and telecom application development to drive revenue. I hope to see you there.

    — Stephen Saunders, Founder and CEO, Light Reading

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    macster 1/20/2015 | 10:31:07 PM
    Refreshing article. Thanks. Firstly, many thanks Stephen. A thoroughly enjoyable article!

    The thing is..... the way I see it.....

    We need 'techcited' people and 'money frontliners'. The best analogy I can think of would be a 2x2 matrix. Sure, we need cash cows. Saying that, we also need to manage 'techcited' people, to come up with high risk, high reward bleeding edge stuff.

    Here's my TLA :) It's IwT, as in Internet With Things.

    When it comes to IoT, I agree that details and specifics are needed. Saying that, I don't think people are comfortable sharing their strategies and financials. You will get the usual "let's move up the value chain and not just do connectivity", "let's try to expand footprint and market share", etc.

    But you won't get people lining up to offer specifics (monetary or otherwise). I know I wouldn't

     

    P.S. I particularly like your "choice words" :)

     
    kq4ym 11/30/2014 | 4:18:46 PM
    Re: VoLTE The poor voice quaility or at least the reliability of a clear undistorted sound is my pet peeve of all time. One would think we'd all like to have the quality of the twisted pair on every device, but it seems many are just becoming used to the lower quality sound.
    mhhf1ve 11/10/2014 | 10:40:02 PM
    Re: VoLTE As a T-mobile customer, I haven't been amazed or impressed by its coverage, but I think it's adequate for a #3 or #4 player in the wireless market. The coverage that T-mobile really needs to improve is its indoor penetration, but it can only do that by bidding on better spectrum than it already has (and upgrading its network to use that spectrum).  I know T-mobile is trying by offering calls over WiFi, but... that's just not a convenient handoff yet to go from LTE to Wifi and back.
    Joe Stanganelli 11/10/2014 | 8:59:56 AM
    Re: VoLTE @mhhf1ive: It would seem to me that T-mobile really needs to build out their network more first.

    Having the occasion to use a T-mobile phone in a major market recently, I was underwhelmed at the ubiquity of spots where there were no service.

    Anecdotal, I know, but still.
    Phil_Britt 10/31/2014 | 6:15:34 PM
    Re: VoLTE Though I agree with you about slow adoption in the past -- I think were were at 2.5 G speeds for about a decade, the pace of change continues to accelerate. The move from 3G to 4G was much quicker than from 2G to 3G. However, if government regulations or a poor economy get in the way, it slows down the progress of new innovations.
    mhhf1ve 10/9/2014 | 2:41:11 PM
    Re: VoLTE

    I doubt we'll see any kind of meaningful adoption until 2016

    I think it may take a bit longer than that... smartphone adoption from 2007 to 2014 went from ~20% to ~60% (give or take a few %), so if VoLTE is just starting out now, I'll predict that it won't cross a 50% milestone until 2019 at the earliest.

    http://www.statista.com/statistics/218529/us-martphone-penetration-since-2008/

    Maybe I'm being too conservative in the adoption rate of VoLTE, and hopefully a majority of users will be using it much much sooner. But I think 2016 is too optimistic. Though perhaps because smartphone adoption is already >60%, there will be some accelerated adoption of VoLTE? Still, I think it may take 5 more years from now to get all the pieces together so that everyday consumers are using it without knowing it. 

    mhhf1ve 10/9/2014 | 2:31:12 PM
    Re: So where *IS* the money coming from in the short term for telcos/cablecos?

    i was told it was the opposite way round, but maybe that's just because i'm talking to the wrong people? Or only getting half the story? 

    Aha.. I'm sure there may be some "not invented here" culture at telcos, but I wonder if it may be hiding in specific depts/divisions... b/c a LOT of telco services/products are definitely NOT invented at telcos these days. The famous "Bell Labs" hasn't really been part of Ma Bell in quite some time, and I'd venture that most telcos are not doing much "invention" for their product/service pipelines....

    We definitely will see how this all plays out.. and it will take quite some time to see it run its course, for sure.

    Steve Saunders 10/9/2014 | 10:53:51 AM
    Re: Internet of Money Sam, i totally agree. IoT will be huge, and analystics are key. But... i still want to see the app analysis. It's like when 802.11 wireless LAN specs were being developed... everyone knew it was going to be big but people couldn't explain why. The word "ubiquitous" didn't enter into it, and it should have done! Anyway, one to watch. 
    Steve Saunders 10/9/2014 | 10:36:31 AM
    Re: So where *IS* the money coming from in the short term for telcos/cablecos? mhhf1ve  

    Re:

    "Interesting. I wouldn't have guessed that, since telcos have been pushing other companies' services and products (white labeled or otherwise) for decades now. I'm thinking that content companies are actually notoriously difficult to negotiate with and come to terms that actually benefit partners very much (if at all)." 

    thank you for challenging my assumptions... i was told it was the opposite way round, but maybe that's just because i'm talking to the wrong people? Or only getting half the story? 

    The only thing that is REALLY clear is that this story has a long way to run, right? 

    Cheers, Steve 

     

     

     
    briandnewby 10/9/2014 | 10:32:13 AM
    Re: VoLTE In terms of Telecom Clarity, or clarity in general, I'm convinced that the most boring things make the most money--or at least are stable.

    I looked at businesses to buy a few years ago and the one that offered the most promise (I still wussed out) wasn't a technology company at all, but rather a company that made flooring for restaurant kitchens.  They had a pipeline that was very deep and just needed more resources to throw at it.

    So, I agree, tell me how to make money today, or how will help me maximize the resources and assets I have today.  I'm all for keeping an eye on future things so I know how my opportunities may grow or end abruptly, but today.

    Beyond that, though, this post was just the most fun thing I've read all week :-)

     
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