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Through the Looking Glass...Go Ask Alice, I Think She'll Know

Category:  Laws & Regulations > Municipal Broadband Policy Debate

When logic and proportion
Have fallen so I'll be dead
And the white knight is talking backwards
And the Red Queen's on her head
Remember what the dormouse said

Feed your head
Feed your head

(Jefferson Airplane, 1967)

More and more, I feel like I'm down a rabbit hole with Alice in Wonderland. Telecom, Vdeo, Internet, and Wireless take up more frequent and larger chunks of the business section in my paper, but the articles give an often confusing account of what is going on. Nothing seems to make sense. Cities are behind some rural areas. Little companies do what big companies just talk about. Cable companies provide voice. Telecom companies want to provide video.

Municipal wireless consultant Greg Richardson opines on the odd behavior of telecoms in his weblog for Civitium. Civitium's Weblog: The Definition of Insanity Why do telecomes persist in fighting municpal broadband, when clearly it's a trend with sufficent momentum to go the distance, and their efforts to stop it have not to date borne fruit? Why do they both not want to serve rural areas, AND not want rural towns to serve themselves? Sane? Insane? Desperate? Deadly Serious? Highly Motivated? You make the call.

Clearly, telecoms will see their revenues from voice calls continue to decline in the coming months and years, with cellular phones chipping away at landline usage, and a myriad of VOIP options shifting into high gear. In press reports at the end of last week, SBC explained its 41% decline in profits for the quarter. While that high number can be explained in part by special events, such as the sale of a profitable directory business, higher costs related to hurricanes and a merger with AT&T Wireless, one has to think that declining voice revenues play a part.

SBC's chief financial officer, Richard Lindner, said that investors focus too heavily on how many phone lines carriers have. Instead, he said, investors should consider all of SBC's services, including broadband, cellphones and video. "All of those things represent connections to the customer and represent revenue sources," Mr. Lindner said on a conference call with financial analysts.

But some industry specialists disagree. Cable companies are persuading tens of thousands of customers to drop their phone service from SBC and the other Bell companies and instead subscribe to one of their new - and often cheaper - digital phone services. (October 21, 2005 New York Times)

But its not just about voice, so don't give up on the telecoms just yet. At the Telecom '05 conference this week, for instance, the Triple Play is all the rage. Change afoot for telecom industry tells us that Voice, Video, and Broadband constitute the Triple Play, and SBC won a big victory with passage of a statewide franchise law in Texas a few months ago. They will try to do the same thing in Washington at the federal level, paving the way for a Triple Play offer over high speed fiber. But that will take time.

Evolving technology and financial necessity are driving the change as growth in the voice business has slowed amid a growing field of competitors. It is an uphill fight for telephone companies, given cable's decades-long dominance in video, but the ultimate winners could be consumers, analysts say. The coming slugfest over America's living rooms could rein in the rising price of pay-TV prices.

"The cable television industry has not had a fierce competitor," said Jeff Kagan, an independent telecommunications analyst based in Atlanta. "The Verizon offering is a bargain compared to the cable television offerings. I think if enough customers cancel their cable company service for their phone company television service, then the cable companies will cut their costs." However, he said, competition on a nationwide scale is still years away. (October 24, Austin American-Statesman)

That's years away for those big city folks faithfully waiting for their traditiional telecom or cable company to bring them services. But for those lucky folks, often in the smaller towns, whose municpalities lead with wireless solutions, the future is now. Smaller rural areas are in the hunt with innovative wireless solutions, as described in Wi-Fi cloud hovers over rural Oregon landscape This article has a great overview of the types of innovative solutions that are possible once an area is covered by a wireless cloud.

While cities around the country are battling over plans to offer free or cheap Internet access, this lonely terrain is served by what is billed as the world's largest hotspot, a wireless cloud that stretches over 700 square miles of landscape so dry and desolate it could have been lifted from a cowboy tune.

When a common network is available at affordable rates, many different groups can step up and share the costs and a profitable business model is available. Sure, it won't kick up millions of dollars that can go to lobbyists in Washington and in state capitals, but the municipal wireless approach, most often in partnership with a small innovative private company, can provide a backbone for all kinds of new applications and business innovations. Voice, Video, and High Speed Internet Access - the Triple Play - that's only the beginning. A world of new solutions awaits those with a high-speed broadband wireless cloud.

My advice - do your homework, ask around, make a plan, take action, try new solutions, keep reading, feed your head. There's just no substiute for open eyes, open ears, and most importantly, an open mind in today's business climate.

Posted on October 24, 2005 at 07:58 AM

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