Greetings from Kansas City, home of the playoff-bound Kansas City Chiefs. First, a
quick thank you for a terrific year for both Mobile Symmetry and The Sunday
Brief. We started the WordPress version of this email, www.thesundaybrief.com, in January 2009 and have had about 1,000 unique visitors each week since then (last month was our highest month ever with 4,100 unique visitors). I have talked to a couple dozen of you over the past month, and broached the idea of moving this to a bi-weekly format. The response has been a unanimous “NO” so I will re-learn “brief” but continue the analytical rigor that makes TSB special.
The “twenty-teens” will begin my third decade in the telecom industry. In the past 17 years, there have been a lot of changes. Broadly speaking, however, we’ve been through several large changes in each decade.
The nineties were the decade of “A.” In the telecommunications world, we began to attach the term “Advanced” to everything. One of my first jobs at Sprint was helping to “Advance” their Intelligent Network. This consisted of three things which would be considered to be elementary by today’s standards: a) Local Calling Cards (neanderthal!), b) matching an actual address to your phone number so the emergency vehicle could get to your home (Enhanced or Advanced 911 services), and c) matching of name to your phone number for specific devices. SkyTel introduced advanced paging services in 1996/1997 so I could see sports scores wherever I wanted to for an additional $8.95/ month. These were considered “Advanced” services in the telecom industry in the 1990s.
Then came the second meaning of the word “A” which is access. This has a triple-meaning. With the enactment of the 1996 Telecom Act,
telecom plant began to be broken into pieces called Unbundled Network Elements (UNEs). Whole organizations began to form to take advantage of these regulatory changes. Wireless access sprouted in the mid-1990s, and by the late 1990s, we started to see wireless data access begin to appear as a commercial product.
The most important use of the term access, however, was the rise of the Internet as a commercially available product. We were able to access the Internet through the Mosaic browser. This gave rise to the last “A” which all of us knew by their three letter acronym – AOL.
nineties: We were advancing in our telecom services knowledge, redefining the term access, and beginning to access the internet with companies like AOL.
The naughties (what the Brits term the last decade) were definitely the decade of “B.” George Gilder warned us – speeds were going to get a lot faster – and, as I have said on numerous occasions, he was right, albeit a few years early in his predictions. Every decade is marked by some consolidation, but with a Republican administration for nearly all of the decade, the last decade can best be summarized as “Buy.” Telecom execs obsessed about the analysts’ view of their stocks (“How many have a buy rating on WorldCom?”). A sleepy Regional Bell became the consolidator for the telephone industry, buying Pac Bell (1997), Ameritech (1999), AT&T(2005), and Bell South (2006). Meanwhile, Cingular acquired AT&T wireless in 2004.
Verizon was born on June 30, 2000 with the merger of Bell Atlantic and GTE (which was largely shed by 2011). In 1999, Airtouch and Vodaphone announced they would connect, and a few months later the current structure of Verizon took shape between Bell Atlantic and Vodaphone. Verizon continued to grow through a series of smaller acquisitions until the ALLTEL acquisition in 2009 (ALLTEL previously being the subject of a management buyout).
Meanwhile, the rural local exchange providers were going through consolidations of their own. Windstream, a spin off from ALLTEL,
and Century Telephone, a community-focused small town phone company, became players by the end of the decade (Qwest being the most recent acquisition by CenturyLink). Frontier completed the earlier mentioned local phone assets of GTE to round out the playing field. There was no standing still in telecom in the last decade – if you weren’t buying, you were contemplating the sale of assets.
As important as the changes in the competitive structure of the industry were the technological changes in the 2000s. It was beyond a
doubt the decade of Broadband. We started with 2G commercial deployments in the late 1990s, with the blossoming of data beginning in
2003/2004 with the deployment of 3G networks. First the aircard, then the 3G phones. Now we have 4G — at least, that’s what it’s termed.
I remember sitting at Lydia’s, a local Italian restaurant, waiting for some industry colleagues to show for dinner when I received a frantic call from my administrative assistant, Joe Vusich. It was June, 2002 and a beautiful Kansas City summer evening. “You’ve got to check out your Wall Street Journal feed – there’s something going on at WorldCom.” So I went to wsj.com over my Sprint TouchPoint mobile phone (free at that time) to read all about it. My friends arrived a few minutes later, clueless that the WorldCom treasury had just shut down and that Scott Sullivan had resigned as CFO. “You’ve got to read this” I quipped, and thus began the age of mobile data access. There were no mobile alerts, no Twitter, not at all how that news would be shared today.
However, the most important part of “B” was not wireless access but wireline. I began the decade as one of the fortunate few – I
had Sprint ION (Integrated On-demand Network). I had power with a screaming 1.5 Megabit per second speeds to my home. I could do nothing with it – there was no YouTube (it would arrive several years later), no Google, no Hotwheels.com (which was an excellent early multi-player gaming site before they shut it down). Just a stupid Superman video that I received when I clicked on the Broadband section of Yahoo (everything else was narrowband).
Wi-fi access was just starting to be commercially deployed, and NetFllix – who were they? I had to go to Blockbuster. There were no X-Box live capabilities even five years ago. Pandora was a box you did not want to open from Greek mythology (or a very expensive jewelry brand), not a popular app on most mobile phones. None of these companies would exist without the rise of broadband. Not one.
Where would app stores be without broadband? How about the Content Delivery Networks like Akamai and Limelight? Where would YouTube be? What about Hulu or ESPN360? NFL games over Sprint and Verizon mobile devices? Without the rise of broadband, and specifically cable broadband, we would be nowhere. It’s why net neutrality matters to both sides of the issue. Broadband gets bigger every year, and as a result, redefines how we live and communicate.
This brings us to the next decade – the best yet, in my opinion. If the nineties were the decade of A (access, advanced services,
AOL) and the naughties were the decade of B (buy it now, broadband) then the next decade must be the decade of C.
The next decade will be marked by at least three factors: customization (and its cousin – choice), connectivity,
and content. Here’s our current situation:
Choice/ Customization. I have Friends who really aren’t friends but are followers. In fact I need to just start over with a new Friend list, one customized by choices I make, not ones Facebook makes for me. The thrill of social networking is gone – I need to customize and personalize my groups. Also, I may want some things to remain strictly confidential.
Connectivity. I have apps on my phone that constantly need to be updated. That’s good for games, but what about connected applications? What about things that marry content with the speed of delivery of that content? Our current networks cannot do this well, if at all. Why have any software resident on any device by the end of the next decade?
Content. By the end of this decade, we will think differently about what content we (and our children) consume. There will be a fracturing of content as the “Long Tail” meets mobile and bypasses cable. YouTube (or Apple’s competitive offering) will become the new channel guide, and, thanks to help from Amazon, we will be able to view content that was generated in Spokane or Salt Lake City or Spartanburg, not Hollywood or New York City. Cable will break from the cartel and be a willing participant in the distribution of this new media, leaving satellite with few choices. It’s cash against tradition, and cash wins. It might take until the end of this decade, but if my wife wants to learn Hindi from the leading experts in the world, she’ll be able to do it through her iPad, iPod, or High Def TV.
Looks like I’ve already broken my resolution to keep it brief in 2011, and, as many of you will surely note in your comments to this column, I’ve missed a lot. We’ve spent 20 years redefining behavior (get on-line), and expectations (be more productive on-line) and are now face the
intersection of content, connectivity, choice, and customization. Happy New Year!
*****************************************************************
Now for five you may have missed:
1. Time Warner Cable and Sinclair Broadcasting agreed to extend their negotiations until January 14. Is there anyone who believes that they will reach an agreement? Read more about it here.
2. Another new year – another China flap. Has China shut off Skype?
3. Groupon founders take some money off the table, according to TechCrunch. A good payday for excellent marketing.
4. Craig McCaw steps down as Chairman of Clearwire. What does this mean? The take from BusinessWeek/ Bloomberg.
5. The Amazon stats are always a fun end of year read. Here’s their news release on the topic.
Hope your year gets started off right!
Posted by Jim Patterson 
