In the competitive world of convergence, the players coming out of the cable side of the industry are distinctly different from those coming out of the telecom side in one critical way: They don’t, for the most part, compete against each other. Yes, there are cable overbuilders but the major players—Cablevision Systems, Comcast, Cox Communications, Time Warner Cable—don’t tread on each other’s turf.
It’s rather ironic, really, given the fact the U.S. telephone system began as one giant company, AT&T, and a lot of much smaller ones. Even after all the mergers that created the new AT&T, there are still significant other players—Embarq, Qwest, Sprint, Verizon—along with the newer competitors—including Global Crossing, Level 3 Communications and XO Communications—all of which eagerly fight each other for customers.
As a result, over the years cable has been able to make some technological hay out of its cooperative attitude, via CableLabs, while the telecom industry has evolved in the other direction. Major initiatives, including DOCSIS—which helped cable modems get to market ahead of DSL, PacketCable and OpenCable—have enabled major cable players to work directly with vendors to speed up the process of bringing new technology to market.
With the notable exception of major joint requests for proposal undertaken in the past by what was then BellSouth, SBC Communications and Verizon covering DSL and later passive optical network technology, the major telecom players do their own thing and go their own way.
There are ways in which this is a good thing. It encourages innovation and enables companies to differentiate what they offer. It also encourages those particular kind of flexible partnerships, often called coopetition, that bring companies together when there is mutual self-interest.
But there are also obvious disadvantages. Companies are usually reluctant to share their successes or even their failures when such knowledge could be put to use against them in the future.
Over the past year, AT&T and Verizon, in particular, have been constantly compared and contrasted by analysts and media due to their very different approach to deploying fiber in the local loop to deliver video services. The prevailing attitude seems to be that one or the other must be doing it wrong.
In the early days, Verizon took the most heat for its mega-billion-dollar fiber-to-the-premises FiOS project, but the tide now seems to have turned as AT&T officials are constantly challenged for a fiber-to-the-curb plan some feel is bandwidth-stingy.
That kind of thinking doesn’t take into account the differences in the two companies in terms of geography, legacy networks and corporate culture. If there is an advantage to the telecom world’s current status, it is that companies can tailor their plans to meet their specific conditions and not be forced to choose a one-size-fits-all strategy.
There is clearly no going back to the days when the industry was more monolithic, but there is a chance, through events like this one, to get the most possible benefit out of the telecom industry’s collective firepower. With the telecom world again focused on one major annual show, this becomes the week in which major equipment vendors put their best and brightest on display for telecom operators, big and small, and the industry’s leaders come together to address the issues that affect everyone. That is what makes NXTcomm an event of significance now and in the years to come.