Gedeon Gabfest on Data App Competition

11:00 AM -- Trying to follow Telus Corp. (NYSE: TU; Toronto: T) CTO Ibrahim Gedeon's train of thought is a little like watching a ping-pong game played by Chinese masters. The ideas are whizzing by at lightning speed but before you can fully digest one, he's on to the next thought. So while the guy is scary smart, he's incredibly hard to quote, because of how rapidly the words flow, and how infrequently he finishes a sentence.

Gedeon was a keynote speaker at this week's B/OSS Conference in Washington and, as usual, he didn't disappoint as far as ideas were concerned, but he was a definite challenge on the word/thought-processing side. Fortunately, at a later Q&A, he agreed to be taped, and while even a digital recorder has trouble keeping up with Gedeon, here's a reasonably accurate transcription of how this very bright telco guy sees the challenge of delivering future data applications:

On why Google (Nasdaq: GOOG) is not a competitor:
    Why do I not think Google is my competition? I drive to work every day and my neighbor Google gets a free ride. I pay for gas and I pay for maintenance on my car, but I would be driving to work anyway. My neighbor is insensitive but I don't really hate Google. It pisses me off as a human being because they ride on your pipe and they make money and don't contribute. But I would not be sensitive if the roles were reversed.

On future ways to monetize wireless data:
    As we talk about services and service enablement, there will be a clash. On the wireless side, I will open up QoS and if Yahoo Inc. (Nasdaq: YHOO) wants functionality, I will open up QoS and sell it to them. There will be a fight between OTT providers. Say you are sitting in a traffic jam in New York City and you don't want to have to wait 10 minutes to see where the best restaurant is, so you are going to click on Yahoo!, not Google. But you are not going to do that unless I've done the right investment in my systems. I will have an applications enablement strategy, and whoever pays me more will get preferential treatment.

On keeping Telus ahead:
    I listen to developers because developers were my team but now there is a development community that has no loyalty to Telus, but wants to make money. And the subscriber is blending multiple services like never before. Their idea of bundling is not getting a bunch of services with a $7 discount, but building the same content on multiple devices.
On consumer choice:
    Consumers pick who's not the worst. We had so many customers who wanted an iPhone. They came to us because they hated Rogers Communications Inc. (Toronto: RCI). They told us they came to Telus not because they like us, but they came over because they hated Rogers' customer care. Their loyalty is not to us. But can I make your apps on your iPhone better than Roger's apps on the iPhone? That's the race for us is -- it's for who can control the network better and open it up, so that your apps work better on my network.

On Canada's One API Pilot, uniting the wireless units of Telus, Rogers and BCE Inc. (Bell Canada) (NYSE/Toronto: BCE):
    This is the first time we brought our competitors along and we worked together, because we are friends in this fight. We aren't competing with each other on this, we are fighting the OTT guys. We put 24 million subscribers on one network API. It's working -- we had a hackfest for all the geeks [developers] and we went from zero to an app in three hours. It's not very impressive for the geeks I get from school but for someone who is used to being in a telco where new service takes 18 months or 36 months, it's impressive.

On similar efforts:
    We need to have that on the wireline side. We will partner with [cable competitor] Shaw Communications Inc. , they have even more of a challenge than we do. On the local access side, I would like them to shrivel up and die, but I have no problem with a marriage of convenience. It's fun for both parties while it lasts. I think it's like Winston Churchill said, we have no permanent friends, only permanent interests.

On charging for data usage:
    I believe we are coming to volume data metering. I personally have cut all upgrades to our HSIA network that is best-effort. I have a lot of gig-Es that are flooded with IP network traffic. Any time you hit 60 percent [of capacity], planners say 'I need to upgrade the link.' And actually, we have that whole process automated so an email goes out so another person, that says 'Hey, I need $10,000 for that link to upgrade it.' By the time we hit 70 percent, I've upgraded for traffic but I haven't increased a dollar in revenue. By the way, I'm not alone, I might be guilty of having automated systems so I get screwed faster, but we all get screwed. If there is no increased revenue, no way I should upgrade. It's not malicious, it's a losing proposition.

— Carol Wilson, Chief Editor, Events, Light Reading

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