January 2, 2008
Late prediction: the line between telco and IT business models will continue to blur at an accelerating pace
The question is will Telco businesses be able to remain relevant as they fade into the cloud? Is the IT world really tough enough to effectively do battle with them?
Daniel Berninger’s piece on Navigating the Infotech Telecom Chasm is a great overview of things to come in the communication space. The hyper competitive world of doing business in the cloud requires that every imaginable mode of communication will be transparently available in the cloud. Email has morphed into IRC, that has morphed into VOIP and that is morphing into COIP. A great overview of COIP is available on a Cnet video.
Moving forward, the competitive nature of the IT business mandates that access to the cloud must also be transparently available. This totally disrupts the telco model of artificially created scarcity, contract based access and rationed bandwidth.
In the past the sheer financial muscle and political clout of the Telco monopoly has enabled them to handily stamp out disruptive businesses. With a relatively new advent making valuations of a few IT companies eclipse that of the telcos, and seed change is in the works.
Filed under Cloud Computing, Content, VoIP by Garry King
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Comments on Late prediction: the line between telco and IT business models will continue to blur at an accelerating pace »
Biggest problem for the telcos is technical/financial. They are mandated to a circuit switched model. Problem with that model is that to increase bandwidth you nearly have to replace everything end to end. Frame Relay they are not. Which causes their financial problems as they don’t have the cash to replace it all.
As to the info-telco chasm, might be right. But I suspect that one of two things are going to happen. Either the telcos fade to carrier of last resort. Or, something like a communications homestead act scrambles it all up to get the US off the dime.
We shall see.