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6/29/2016 | 4:30:46 PM
Re: Free ride?
It does seem the Telcos are going to have to turn up their creative juices to keep competitive. As offering services to "consumers on the telcos' own networks as a whizzy and cheap alternative," is going to take some work to overcome. How fast they can move on software virtualization may make a big difference in the end game.
Mitch Wagner
Mitch Wagner
6/20/2016 | 8:05:47 PM
Re: Free ride?
brooks7 - I like your model here because it turns conventional wisdom on its head and I'm a sucker for the contrarian view. It paints a picture of OTT providers bearing the risk and service providers reaping the benefit of that risk. Service provider says: Want to go up against Netflix and Amazon Prime? No problem, we'll take your money. 

It's like the woman in THE INCREDIBLES who made all the costumes for the superheroes. Lucrative business, and less risky than chasing supervillains. 
6/17/2016 | 9:33:42 PM
Re: Free ride?
@Mitch To me, it looks like the UBER way, they don't own cars, but make the best usage of these cars owned by someone really efficient making a WIN WIN situation to all stake holders. At the end, it is all about  customer experience and no wonder customer sees immediate value at the uber app, though telcos do lot of heavy lifting (like the car owners) in the background. It is for the car owners to keep their assets fit and responsive, else they too will vanish from this new game! changing times :)
6/17/2016 | 3:25:38 PM
Re: Free ride?
More than that Mitch.

The business investment and risk profile of an OTT player is entirely different than a facilities based provider.

To me that is the heart of the problems that you have pointed out here.  The Telco makes its money no matter if any particular OTT player does well or poorly.  They ALL need bandwidth.  

Simple answer on how make a Telco more nimble?  You can't.  If you want to build a nimble OTT company within a Telco then it needs to be a completely separate subsidiary.  Can you imagine the Network Engineers at Comcast reviewing the plan for next year's fall lineup at NBC?  That is how ridiculous it sounds to me that Telcos are going to be able to adjust themselves to compete with application developers.


6/17/2016 | 12:32:40 PM
Re: Free ride?
Agreed. It's unfair to suggest the OTT players are free riders -- that view of them is very much from an old-school telco perspective.  
Mitch Wagner
Mitch Wagner
6/17/2016 | 12:24:49 PM
Technology for technology's sake
I'm concerned that when I hear service providers talking about virtualization, they're saying they need to virtualize so they can innovate, without specifying what that innovation is. 

That's backwards. 

Businesses need to identify demand, then buidl infrastructure to feed that demand. Virtualizing for future, unspecified innovation is the other way around. 
Mitch Wagner
Mitch Wagner
6/17/2016 | 12:22:48 PM
Free ride?
"OTT players became a threat by repurposing mainstream telco services and then offering them to consumers on the telcos' own networks as a whizzy and cheap alternative. That is a bit like using a carmaker's factory, free of charge, to produce lower-cost and more stylish vehicles."

In other words, OTT companies are free riders, parasites who sit on top of telco networks, contributing nothing and siphoning off the profits?

Not true. 

OTT providers pay for bandwidth from their datacenters to the Internet. 

Then consumers pay for bandwidth to consume the OTT providers' services.

Netflix pays Amazon for cloud services, Amazon pays ISPs for Internet connectivity, and I pay Cox for the Intenret bandwidth to watch consume Star Trek: The Next Generation on Netflix. 

No free rider. 

What the OTT providers are doing is more like leasing a factory from a car company and then producing a better, cheaper car. 

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