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We need to recongnze that the pipe access is contested by consumers and service. Enabling smart pipes provide the opportunity for Telco's to offer real value beyond just data connectivity. That extra value has both extrinsic and intrinsic benefits over an above just initial contribution to just margins.
We already see the benefits in NTT, SKT, Vodafone etc who are all very successful in their approach to smart pipes. Perhaps the real argument is that in highly competitve markets with OTT, Cable, Content Players, Telcos et al heating up the broadband play, a bad "approach" to smart-pipe is worse of than dump-pipe. However, smart pipe has an essentially deeper value essence that Telco's realize in order to manage and grow not only revenue but also an important key angle as customer experience.
They receive high revenue and then turn around and pay about 90% of that to the content guys. That is why it is a very low margin business. Having high revenue does nothing if the profit side is small. And I think it is HYSTERICAL that you think that the guys who build networks are going to be good making content. They don't even make their own products for their primary business, why are they going to be good at making products for a business that they know nothing about.
The Networks owned very few stations. What they did is have affiliate stations that rebroadcast their content. Affiliates pay to belong. Just like Cable Cos pay to distribute content and in the long term, ISPs will pay to distribute Hulu. If you own good content, you don't pay to be distributed. You get paid to allow 3rd parties to distribute your content.
To be fair, Comcast owns NBC. But in general why would you not outsource the low margin business?
Say I'm CBS, ABC, FOX or NBC. I'm producing or enhancing original content. I'm creating the value. Everyone beyond me is a re-marketer. Everyone before me is raw material.
Why shouldn't I get into the Net-Com business and directly provide it all the way, like I used back in the 1950s-70s?