Wave Systems Corp. (fka WAVXQ)

[Armp]

(OT) I don't know if this is relevant to this Board, maybe convergence and wavexpress still have a bit of a wait.

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Beyond Net Neutrality

http://www.alwayson-network.com/comments.php?id=14717_0_14_0_C

Bells, be careful what you wish for, says Pip Coburn. Because instead of cleverly slowing the collision, as they've been doing for years, the Bells are speeding ahead towards something that's unlikely to benefit them.
Pip Coburn [Coburn Ventures] | POSTED: 04.13.06 @07:00

This week's point: In late 2004, there was a flurry of announcements about "video over telephony" in the United States. Since then very very very very very little has actually happened. PacBell/SBC/AT&T has done next to nothing, while still proclaiming it was aggressively pursuing this fantastic opportunity. Verizon is a bit more aggressive, having rolled out basic "fiber to the home" service and testing a video service in Keller, Texas that might ultimately lie on top of its FiOS service. That's it.

To be clear: I that think IPTV in the U.S. market is...
incredibly
incredibly
incredibly
incredibly...
me-too.

The best that can be said is that, well, you might as well deliver video, since you "have to" build fiber out to provide faster data speeds anyway or risk being put out of business. That doesn't sound like a great rationale. It isn't. But following the public proclamations of a strong intent to roll out video, little has actually happened.

Now, something might just happen for the worse: regulators might expect the Bells to actually deploy IPTV before too long. Yuck!


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We have talked about the "collision theme" over and over since someone from a major equipment supplier—I think Motorola—presented the idea to us 18 months ago. Most of the world talks of convergence, but for suppliers in the ecosystem the phrase collision works much better. Convergence is too pretty a word for the painful drama that is ahead. Collisions are not fun or exciting. Collisions are painful.

I have been impressed by the Bells' ability to manage the looming collision. Imagine a slow-moving car accident. Well... management teams of some of the Bells have done a sensational job slowing the car accident as much to frame-by-frame as anyone could have ever imagined. Will they be able to avoid a collision altogether—will the drivers have time to miss each other? I don't think so. Apart from the sensationally stratospheric wages that the CEOs of Verizon and ATT collect, I would utterly hate to be in their position.

But in the meantime, the Bells have created more time to allow their greatest asset to flourish. Absolutely flourish.

What is their greatest asset? The network? Nah. It is their lobbying corp. I have suggested that any study of telcos around the world might best start with a comparison of their success in lobbying regulators. The Bell lobbyists are spectacular. Their peers in the UK are pretty good. Germany? Losing power quickly to the EU forces. Korea? Weak.

In the United States:
· Headcount reduction goes unchecked
· Consolidation among major players goes unchecked
· Regulation of services to small-medium businesses has recently eased
· DSL service no longer needs to be shared with startups
· "Muni wireless" has been outlawed in many states.

Some of my friends think that most of this is evil stuff, and have in fact recently worked hard to fight these forces in the packet-prioritization/net-neutrality debate—a debate I actually think wasted a good bit of time, as opponents couldn't communicate what they wanted the world to look like, and the Bells merely wanted status quo in being allowed to offer tiered services as they always have.

If Ed Whitacre hadn't suggested that he wouldn't allow Skype on his network—a rare miscue on his part perhaps—I don't think this would have ever erupted.

But let's forget the "evil" thing or that the "do no evil" guys have just joined the fracas in hiring their first lobbyist.

The Bells spend billions on lobbying, and I suggest that they're getting their money's worth largely because Bell management teams have worked hard to avoid flat-out collisions during the past decade. They have given their lobbyists time.

Video is a potentially horrendous collision ahead. The fact that the Bells have done basically nothing after their grand announcements in 2004 suggests that they are wary of ending their quasi-détente with the cable cos. The cable cos, for their part, signal a willingness to compete viciously in a tit-for-tat style any time and any place the Bells wish to roll out video. The cable cos will dramatically discount pricing on high-speed data on a tactical basis.

Now...

The lobbyists have done their job again.

It looks as though a national video-licensing process will be approved soon. For context, when cable started, way way back when, the operators had to go to each locality and file for permission to do video. What a pain!

The Bells don't want to suffer through such a process, so their lobbyists have been working to have a single national process introduced, so that Americans more quickly get the benefits of IPTV from the Bells—which to me seem to be nothing, unless you want more ways and times to watch elimiDate. The lobbyists have rolled out the benefits of more family packages, and the Bells may actually create such one day—so long as Sex in the City can still be worked into the mix.

So they may get what they want once again, but in this case the Bells may be sorry for what they asked for.

Why?

The Bells are great at never publicly embarrassing the regulators. Good plan! Jack Nicholson once said there was only one rule: never embarrass a cop in public. Similarly, the Bells don't embarrass the regulators. But here the regulators will be allowing them to side-step years of bureaucracy in being able to file for a national license to deliver video.

Unfortunately, I think it makes little sense to aggressively roll out video—it makes no sense to accelerate it. Won't the regulators expect them to really do so, after this wonderful national licensing gift? By accepting this gift, the Bells may wind up accelerating the collision, and thus remove the time and opportunity for their best asset—the lobbyists—to keep performing magic.

Is there a way out?

Yes. Blame Microsoft for not having the IPTV technology ready.