Time to Redefine Telecom

Telecommunication, according to Wikipedia, is the extension of communication over a distance. In practice, it also recognizes that something may be lost in the process; hence the term 'telecommunication' covers all forms of distance and/or conversion of the original communications, including radio, telegraphy, television, telephony, data communication and computer networking.

While defining telecom gets more and more difficult, the profit and ethics behind the business keep on diminishing. SBC spent $16B to a company whose revenue stream is declining more than 10% year over year. Verizon bought MCI, and in order to make deal lucrative, they say they will layoff over 7,000 people.

The reason for scaling-down in telecom is that the technological advancement has terribly been focused on communications. We all owe a thank to nineties for that... Lots of technical people has seen the future in Telecom and made huge amounts of mind investment to the business. Today, we are forced to live in an overly competitive industry where telecom is forced to be cheaper everyday. To make matters worse, a company called Skype appeared. This global P2P Telephony Company decided to make old fashioned definition of telecom a commodity through its software, which allows you to make free calls over the Internet. Other emerging companies like Net2Phone and 8x8 also flocked customers to make cheaper (sometimes free) calls.

Some traditional telecom companies have kept an awry eye on those start-ups while adopting technologies like VoIP. They mostly thought those new technologies are something to monitor and investigate. In other words, they are disruptive. Some assumed the danger and started firing QoS bullet, as those startups do not provide top-notch service like incumbents do.

The fact of the matter is, none of those business plans will hold true should they are based on making money on calls. Like Michael Powell said, "I knew it was over when I downloaded Skype..."

So, can we say that telecom is a commodity?

My answer would be no, if network providers accept to change their musty mindset. Three things are important if the full background of this new notion is to be understood. First is, telecoms exist to provide infrastructure. The rest needs to be handled by networking and computing companies.

The need for voice, video and data are going hand in hand. There is no value in them when there is no Internet. That's why, the second is, the new business plan should be based on the Internet access. If telecoms want to survive, charging customers packet-based with the guarantee of excellent QoS is the only way to go. MPLS is their material to make this happen.

This way, optimization, the biggest concern of telecom industry, can be solved as the packet usage can be approximated. Demoting VoIP into an application to where it originally is can be doable in packet-based model. This new model will also disallow fighting against free-of-charge models and bring a fresh breath to network providers to generate more revenue.

Third is, not only the ability of optimization but also the prioritization and security of the traffic, if needed, will let network providers to put extra cash to their pockets. The money behind the content will not be their ball game.

Some may argue that there is no incremental cost of extra usage of packets to a network so the value behind tracking the traffic is nonsense. However, what is unseen is that it forces network providers to upgrade their systems quicker. They can also build their cost /profit structure easier.

Perils to the model would be the evolution span of MPLS and anti-spam systems. MPLS, as an immature technology, is welcomed with high expectations. Addressing all needs in such a short period of time needs a lot of investment. The story is almost the same for anti-spam solutions too. No customer would like to pay extra for spam as this is adding to the traffic that a user is using. That would force network providers to unify on an MPLS/ anti-spam model where they and their customers can rely on.

Once this new role of incumbents is well assumed with solid technology, then converting the so-called threat of telecom commoditization into an opportunity is feasible.

Burak Fenercioglu is a freelance writer and working for a computer network security company for over 4 years. His articles are about new ideas, innovation and strategy all of which can be found at http://burakfenerci.blogspot.com

---

Cheap Internet Access

For anyone trying to get the cheapest internet available, there... Read More

Mind Machine Interfacing

SQUID:In 1984 I was partnered with a Cable TV engineer... Read More

What is Broadband?

Defining broadband can get complicatedThere are many different takes on... Read More

Webmail - What are the Benefits?

There are so many different webmail services on the internet,... Read More

Top 3 UK Broadband Providers

Every Internet provider today wants to make it sound like... Read More

Internet ISPs

Choosing an internet ISP is often a rash and impulsive... Read More

3 Tips to Fix Unreliable Wireless Connections

Generally speaking, wireless computer connections are reliable. However, nothing is... Read More

Broadband is State-of-the-Art Internet Access: How Can a Broadband Cable Benefit You?

We are now well ensconced in a time when the... Read More

Google Talk Reviewed

So you're sick and tired of AOL Instant Messenger. You're... Read More

How to Test Your DSL and Cable Internet Connection Speed

There are two measured elements that determine your internet connection... Read More

Bleeding Edge or Expensive Enterprise Satellite Internet?

The State of Satellite Internet in 2005For those businesses unable... Read More

3G EV-DO or How the Internet Got Its Wings!

The Internet, as most people know it, is history.It just... Read More

Two Enter Internet Battle

Consumers understand that when there is more competition in... Read More

Long Arm of the Law Reaches New Internet (RIAA, Internet-2, i2hub Lawsuit)

Have you heard of the new Internet? It's called Internet... Read More

Wireless Network Hammerin

The wireless network in my house went haywire. It worked... Read More

Business Satellite Internet Products Compared - 2005

There are a number of options available for Business Class... Read More

Chat-less

Are you suddenly chat-less now that Yahoo has shut down... Read More

Google Brings Millions of Hard-to-Find Library Books to Your Fingertips

Millions of hard-to-find books from five major libraries will soon... Read More

Broadband

Broadband is the name given to a high-speed Internet connection... Read More

Remotely Connecting by Satellite To the Hospital - 2005

Hospital's and the Medical Professionals associated with them across America... Read More

How to Get Broadband

Getting broadband services getting easy, but research still required.Broadband Internet... Read More

Wireless Technologies in Mass Transit for Convenience and Safety

Modern Mass Transit is making it easier for commuters, especially... Read More

Find the Best Broadband Provider for You

To find the best broadband provider for you takes some... Read More

Searching for the Right ISP

When searching for the right ISP there are a number... Read More

ICMP Protocol - Internet Control Message Protocol

The Internet Control Message Protocol communicates errors messages between systems... Read More