Friday, December 30, 2005
2005 is almost done. I thought it would be nice to do a quick roundup of the various opinions we posted, incase you missed any. Thanks to all the readers who have sent emails to us - we had a lot of fun voicing our opinion and it good to hear that you had fun reading too.
So here is the Round-up:
Technology Related (oldest to newest)
Thursday, December 29, 2005
Whoa Corporate Rat! I still cannot seem to resist a good ol' geek talk! One more of the year, OK?
It is just plain hard-work when you are trying to join a communications club that is several decades old with multiple generations of engineers developing distinct applications and services.
What is happening in the VOIP world is nothing new. Standardization is inherently complex. It becomes doubly more complex when you consider voice communication is of vital interest to multiple societies. It becomes triply more complex when the infrastructure being replaced is the most used and the most stable in the world!
Discussing your arguments:
1. Text based Protocol: Yes, SIP could have been XML based but THANK GOD it is not ASN.1.
2. Refusal to standardize services: I don't know why the IETF should do this? Do you really think we could get two carriers to agree that Call Forwarding RNA should terminate in an intercept or ring forever? Or that Music On Hold is an "expected" feature in business applications all over the world?
I think the push for standardizing services has more to do with carriers being apprehensive that they will be locked into a proprietary solution. Industry groups like the SIP Forum are the right place to standardize services for their customers. OMA is another good example.
3. The Royal Routing mess: This is a legitimate argument. I am not too worried about Record-Route headers (HTTP has them too BTW). The SBCs, acting as giant B2BUAs in the sky, have made things a bit simple :-D.
I think the SIP community needs to solve the hard problems (which I consider are routing issues): Lifeline services and lawful intercept.
4. Bloat Bloat Bloat: If you examine carefully, most of the complexities have to do with trying to model the PSTN in SIP. The industry secret is: You don't need intelligence in the network for Alice to find and talk to Bob and you don't need all this bloat for Alice to buy phone service with a handful of cool features... all you need to know is your outbound proxy and your service proxy. IMS architects, please listen!
5. This is not what SIP is meant for: Most of the original SIP "zealots" are healthy, wealthy, and Directors at rather successful companies... let's leave it at that :-)
6. Forking: LOL! It's Forked ;-) !
7. E2E Architecture: I will let RFC 1958 speak for me. I rather like the fact the I didn't have to wait on the SBC Yahoo! CallCenter for two hours since I got IP connectivity: Hosted email, music downloads, video on demand, chat, online bill pay, webmd.com... the phone companies still have BIG BIG plans for all of this... since 1955!
Skype is a remarkably successful and proven business model. It is always very easy to build a good proprietary solution. Going back to the email world example, Lotus did this rather successfully with cc:Mail. But, we don't even discuss SMTP interoperability today... SIP will get there. The page that the SIP folks can take from Skype is:
1. Make configuration dead simple! Sorry, SIP endpoints suck at this!
2. Solve the NAT/Firewall issues. Good progress here!
BTW, Vonage has 1 million paying subscribers and they solved the same two issues that Skype did. And they are standards based (MGCP right?).
8. Backward Compatibility: Most of us have moved forward to 3261. Most carriers will not accept SIP solutions that are "ancient".
What blows my mind is that the technology is ready for a Google, Microsoft, or Y! to become the voice communications provider to the whole world! Just like email!
Isn't that just incredible? It's time one of them offer free phone service to the PSTN as well!
Several years ago, I was the lead architect for a team that was building an H.323 Gatekeeper. I remember having attended a conference where a mild mannered bearded professor talked excitedly about something called ‘ZIP’ which seemed to be an IETF initiative that was pitched as an alternative to H.323 complexities. When I got back to my office, I researched on this new thing called ‘ZIP’ and the promise it had but found nothing. I then realized that ZIP was the german equivalent of the english SIP (when pronounced). I still remember having read the first IETF draft on SIP – it was a breath of fresh air compared to what I was building as far as protocols went. Actually, even though the first draft was out in 1996, I got involed only in 1998 when the SIP draft was still a breezy 101 pages cover-cover. Infact, I was so convinced about SIP that I started a SIP group with no budget funding and working in spare time. That was till we made our first release and sold to a whole bunch of customers. That's when the company woke up to it and suddenly everyone was interested.
Well, that was then. This is now. After having spent several years in building SIP components, Proxies and App server frameworks and then talking to customers who built on top of them (my past company is one of the most successful SIP infrastructure vendors in the market), I cannot help but think whether SIP was really ‘simple’ to start with simply because the standards never really encompassed everything that a real-life telecom deployment needed (which to a great degree H.323 did) . Over the years, SIP has grown into a veritable behemoth (269 pages in the SIP Standard, 25 pages of the SDP offer answer model and over a 150 drafts related to all things SIP) and I bet no one really thinks it to be simple anymore.
Infact, I think SIP has pretty much become a subject of its own market hype as well as lack of completeness of thought in the original ideas espoused. As far as I am concerned, today, SIP stands in the market as a ‘HTTP similar expandable protocol’ but to the developer, stands as a ‘Massive hack of spaghetti headers and rules”.
Of course, this does not really affect the top level app developers. The folks making middleware are the ones who deal with this mess. So if you are building a great new service on SIP, you probably have no idea what I am talking about. Heck, you probably don’t even need to know much about SIP. You probably just invoke APIs like CreateConference(email@example.com, firstname.lastname@example.org, email@example.com) and ta-dah ! You are done ! I’m not trivializing what you are doing – moving to a protocol independent service based architecture is what it should eventually come down to. But then, it still does not take away the fact that the folks doing application and stack platforms (BEA, Oracle, Radvision, Flextronics Software Systems, Ubiquity) are still cussing out loud. And their cussing matters, because if your infrastructure ain’t upto it, your pretty apps will eventually come crashing down.
So here are my thoughts on what’s wrong in SIP:
Text based protocol: Yes, a text based protocol is great to read and see as it flies over the wire. But who on earth needs to ? Do you really want me to believe that a person debugging a protocol cannot have a simple binary decoder built into his analyzer ? While being text based and touting that its ‘similar to HTTP’ excites the market, it is meaningless to a developer. Thanks to it being a text protocol with no message boundaries, we worry about buffer-underflows, overflows, not getting content-length in the chunk of messages that we receive and similar. Not to mention that we need expensive parsers that try and detect all gotchas to ensure that some sleazy string trick does not crash my parser. (Show me a simple SIP parser and I will show you 10 ways to break it). And then you need stuff like sigcomp to compress it so the wireless world can use it for the air interface.
The refusal of the IETF to standardize services: ‘We would like to encourage multiple ways to do one thing. It encourages development.’ Yes, I agree, when it comes to geeks in labs. In real deployment, we want two phones to be able to transfer a call successfully. Little wonder why it took upto 2003 (SIPit) for two different SIP phones to actually do a successful blind transfer. Had there been a recommended profile to begin with, we would not have un-successful half-calls for the next 2 years and by now would have moved on to better interop in more advanced scenarios such as conferencing (which is still progressing at a dreadfully slow rate over at XCON – mostly still stuck at requirements and framework level)
The Royal Routing Mess: SIP’s routing logic is probably the best example of how it has evolved to become a hack protocol. Strict routing evolved to Loose Routing. To make sure implementations don’t break, it was decided to support both. Then came the logic for loop-detection which got so painful that it was then suggested to do away with it and just fall back to Max-Forwards (keep looping till a count goes to 0 then break the loop). As if that was not enough, the recently introduced concepts of Globally Routable UA Uri (GRUU) essentially another hacked mechanism to differentiate between an instance of a UA vs. the general AOR that of a UA that could reach any instance of it (complicated ? don’t worry, most of us find it messy too) make this space even more miserable.
Bloat Bloat Bloat: SIP is a bloated protocol. As as said before, show me a minimal SIP parser and I will show you 10 ways to break it. As the market rides the hype of SIP, our poor friends at the cell phone companies are struggling to fit in good robust ‘text-based-HTTP-similar’ SIP protocol stacks into their phone while making sure a simple message to it does not reboot their phone. On top of it the complex 300 page RFC with processing rules just adds fuel to the fire.
‘This is not what SIP is meant for’: unless you are blind to the market, you would notice that 90% of SIP deployments that make money are in networks that choose to do in SIP what the PSTN did. Continuous harping on ‘This is not what SIP is meant for’ is meaningless. If this is true, then close the case for SIP. Don’t complain about the PSTN mapping to SIP when almost all deployments making money want that. This very ‘holier than thou’ attitude is one strong reason why SIP deployment is just about nearing the mature stage where it should have several years ago. (Do you know, doing a CLIP/CLIR in SIP was fairly undefined till a year ago ?). Every time folks at groups such as TISPAN post in the SIP working groups, they are met by technology zealots who repeat the ‘This is not what SIP is meant for’ to a point of fatigue.
Forking:This one construct is the achilles heel that adds un-neccessary complications to message handling. Who really needs it and why does it have to be an integral part of the base specification. If it is a part of a base spec, everyone has to implement it,
whether they need it or not. Move it to application scope and don't force 99% of the implementation world to worry about providing for situations such as HERFP.
‘End-End Architecure’ : The End-End Architecture and concepts are great. I understand that is what drives the IETF. But realize that SIP is being used in many networks that do not strictly follow the puristic Internet Architecture. So instead of shunning. I’m not knocking the End-End Architecture – its great, but even the original authors of such architecture ideas talk about situations where the purity of the end-end architecture is not realistic.
Losing ground of reality while dreaming about ‘Web’, ‘Presence’ and ‘Revolution’: SIP enables a lot of new services – but losing sight of reality while dreaming of next wave solutions such as servelets and SIP-CGI is again, not being realistic (for example, the long argument at SIPPING about draft-stein-great which raises real problems which seemingly are not important enough for SIP). Again, please look around you at the deployed networks and see what they are doing. And while you are looking, look at IMS too. Hopefully you will wake up then. It’s all traditional networking folks. As an example It’s unbelievable, that the Working Group has such a hard time accepting the fact that Session Border Controllers (SBCs) are a reality. Infact, when Skype first announced that SIP was not ‘good enough’ (this is one of the later links – I lost the original post by the Skype architect about SIP not being good enough) the SIP stalwarts responded by blasting the Skype architecture and why it was not ‘scalable’ (again, lost that link). Well, today Skype has done in one year what SIP could not do in five. The SIP folks finally woke up to the reality and are now trying to define P2P overlays on top of SIP. I applaud the effort, but it’s a little too late.
Backward-compatibility burden: SIP is burdened by the load of backward compatibility more than it should be. While this is good talking material to the press ‘We designed a protocol that is always backward compatible’ it’s a living nightmare for developers. If there was short-sightedness in a specification, admit it and move on, and if the backward-compatibility is expensive, drop it. Developers will fix their code. Really. It’s much better than having a brittle implementation with a long ‘case’ statement.
The SIP that the marketing world sees is very different from the ‘under-the-hood’ look. I just hope that the process of SIP evolution does not come crashing down. Infact, the only way to stop that eventuality is to move to a services based architecture where protocol becomes irrelevant (once the bad work is done, let it hide deep inside, never to be seen again). So Yay for SIP servelets ! I just hope the working groups move fast enough and not pursue their goal of complete end-end purity at every step, because if they did, by the time they had a solution that was perfect, teleportation would be a common means of travel, the single pill that cures all diseases known to makind would have been discovered, and we would all have bought vacation homes in Mars – no one really would care much about SIP then.
Tuesday, December 27, 2005
The more I talk to people, the more I am convinced that in this world of convergence, he who controls user content is the one who controls the money.
Last afternoon, I spent a wonderful few hours validating a new business plan with a Silicon Valley executive with an illustrious past who is looking at starting his own thing in this ‘Citizen’s Media’ space. Obviously, I cannot comment on his plans, but would like to talk about my view of ‘Citizen’s Media’
What is ‘Citizen’s Media’ ?
The marketing world always needs a catchy phrase to describe any new technology that hits the market, be it an evolution or a revolution. ‘Citizen’s Media’ essentially refers to the concept of involving a wide network of participants who in addition to ‘reading information’ also act as ‘contributors’ of information. So Wiki, Blogging, Podcasting and similar are all examples of ‘platforms’ that fall under the Citizen’s media space.
Citizen’s Media (CM) as a concept has been covered and iplemented in various places. Backfence.com is one example which is a community based site that allows community residents to share and discuss information for others, constantly adding to ‘live news’ for others to read. There are many more such examples.
Forbes, however, asks a relevant question: ‘Is there money in this space ?’. There is no question that blogging, podcasting, RSS feeding et. al. are the new wave communication mechanisms that define “Web 2.0”. However, who is really making money off this ? To address that question, let's discuss what Citizen’s Media addresses and the business models around it.
TV vs. Internet
Imedia has an interesting report which details the trend of online-advertising vs. advertising on TV. In short, online ad revenue has increased 33% last year at $9.6b. Compared to this, the Pay Per View and TV advertising is $60billion but its not growing. In other words, it looks like online advertising is steadily eroding ad-money from traditional channels. And why not: the same article reports that viewers spend 34% of their media consumption time on the internet. In my previous article, I had also provided some references to broadband adoption which is very healthy.
The fact that TV advertising is not growing much and that online advertising is growing very fast is a clear trend that content providers recognize the online medium as a revenue generating space. A growth rate of 33% with an existing revenue of $10b is enough for me to think there is money for us to play, eh ?
Modelling a business around it
Every business is eventually a derivation of the classical producer-consumer paradigm. In the case of Citizen’s Media, there are some basic questions to answer:
- Who will use this service ?
- How do you attract producers to contribute quality time & information & consumers to participate ?
- Who are the value-chain participants ?
- What is your risk mitigation strategy ?
Who will use this service ?
An important demographic to model around. Are you targetting the top 5% of the earning market or the bottom 30% of the middle class market or the vast mid-section of teeny-boppers ? Existing Citizen Media solutions have been embraced by what I call the 2nd tier of enthusiasts – those who are not professional, have free time and don’t have the money nor network nor agents to approach a Comcast or a DirecTV for a slot. This represents the vast majority of producers of this CM space.
There are ofcourse, savvy professionals who have seen the profits and the reach of such a system, such as Om Malik’s GigaOm blog (which is a good read, by the way) , but they represent a very small percentage of the larger producer space of today.
In terms of consumers it really depends on the content being fleshed out. Teeny Boppers have a lot of time and inclination to stick to CM blogs, podcasting and similar. Don’t trivialize this market – they were solely responsible for ensuring that digital camera equipped phones outsold digital cameras by a good margin. At the same time, blogging and podcasting draw many professionals, many of whom spent at least 4-5 hours a day on these forums. So my take is that the age group of 15 – 35 is the target space for the CM space as far as consumers go.
How do you attract producers to contribute quality time & information ?
Quality of Service ,revenue and outreach: Provide them a platform where it is easy for them to create their shows and take care of marketing, viewer base and quality casting for them. Use the right tools and platforms and build on existing technology instead of starting from scratch. There are lots of innovative social network platforms such as Ning and similar that already have a good amount of work put in to build on top of. Make a simple to understand business case that does a what-if analysis for them. Show them, how, via ads, via content selling as well as providing premium services they can make money (By premium services, I mean, let the basic show be free, but when people get stuck on it, provide, say, an ‘advice channel’ hosted by the producer, where consumers can pay $2.99 for 1 session and take advice from the host – just an example). Also strike the right partnerships with the right OEMs and service providers who can market your service. For example, tie up with a Verizon and have them push this new service onto their OEM phone manufacturers.
Who are the value chain participants ?
In any successful business that survives more than a few years, everyone in the value chain needs to profit. Remember you are trying to run a business. So keep profitability in mind. Identify the players:
The providers (you) – This is a captial intensive game. Your network must be wide and your quality of hosting superior before you get into the market. Strike the right partnerships. Talk to the right content distributors (remember, you are a provider not a distributor). The success or failure of a service is more often than not dependant on how well you market the solution. Marketing ! Marketing ! Marketing !
The Producers – your first line customers. Make sure their entry price to use your service is not high for them to shy away. Remember, they are 2nd level amateur users for the most part. Deploy a risk-reward model. Modulate your subscription cost as a function
of the popularity of their content. Let them make money by getting a chunk of what you earn from them. Let them set up their own innovative ways to manipulate their content for secondary revenue streams.
The Consumers – the people who are eventually responsible for everyone else’s revenues (just like TV viewers are to TV producers). Spend enough time striking the right partnership deals for maximum distribution of your selected demographic. First choose your target market and go hell-for-leather in marketing to that segment. Don’t try marketing to the wide world – different demographics have different sweet spots.
What is your risk-mitigation strategy ?
A colleague of mine recently told me that to stay alive in this industry you must continuously re-invent yourself. Even if you are the first to deploy a solution, eventually the giants of content will wake up. How do you protect yourself from being trampled all over, undercut and oversold ? There are many mitigation strategies including:
- Defining how you will stay ahead of the others in terms of technology and consumer expectation mapping
- Expect to get bought over by one of the goliaths who want to ride on david’s shoulder – sell out, make your money, do something new
- Striking the right partnerships to ensure that a collective force which is in a win-win relationship can offset hostile takeover bids
- Keep your opex under control – if you don’t want to sell out to bids, expect serious profit margin erosion when the biggies step it. Opulent opex at that time swings back to slap you hard.
- Create a ‘we are not your competition but your partner’ targetted pitch for different ‘people’. The first people to get scared would be the Payperview TV goliaths. They already see their billions slipping – but they are not really your competition, since they are a distribution channel. Make this pitch clear to them and identify areas you can work together. Leverage their network further with a possible partnership. The same holds true for other identifed ‘friend or foe’ market.
Infrastructure exists. The Market Exists. The failure or success of making the CM space into a profitable business is certainly possible but needs good planning and of course, a lot of luck. However, if you don’t do it, someone else will. So I’d be watching the folks in this space. If you are a VC and find a good team trying to play in this market, Invest !
VOIP is a giant leap forward in dragging us "Call Processing" types out of the dark ages to the modern world. SIP is the motivation.
While SIP improved the interoperability between systems, it did not take away the inherent complexity of developing voice applications. Many of us VOIP application vendors basically built proprietary constructs from scratch (a HUGE benefit) that helped develop applications rapidly.
The net result is that voice applications continue to be developed by a select few.
Don't get me wrong. We all use the latest and greatest available today: Object oriented design patterns for vastly improved software quality, SOAP for remote data access, CPL or equivalent for simple routing, VXML and MSML/MOML for media control, and a services oriented model for application delivery. However, they continue to be proprietary to the application vendor.
The best we can do is claim SOAP or SIP as the "API" for developing applications. Want to integrate a cool conferencing application as a "converged" application? Sorry, besides SIP "interop", no can do!
Carriers are wising up to this.
They are demanding an open environment that doesn't lock them into a particular vendor. Initiatives like IMS are forcing vendors to rethink and offer an open and integrated solution.
How far away are we from being able to place a call with a simple function call from any computing or communication device? Time will tell.
The best bet the industry has now is SIP Servlets. This technology has the provisions in place for rapid application development, an asynchronous programming model, and state of the art data access. Reputed vendors like BEA, IBM, and Oracle have application servers that are battle hardened in the Web world. They are scalable, robust, and boast of a stable developer community. The "traditional" PSTN community is also attempting to converge on a similar effort with JAIN SIP. This really completes the picture.
The new year looks promising! Is it time to talk about "Call 2.0" ?
Sunday, December 18, 2005
As you keep growing in your career, there will be a point in time when all of a sudden, you will look back and say “We’re Not in Kansas Anymore” ! This revelation comes to you, not in Wonderland, but in the midst of a lonely and confusing battleground known as the “Corporate World”.
Some thoughts on what it takes to continue to have a smooth ride in this battlefield:
- Tame your Ego: Almost every good engineer has a tremendous ego. They think they are the best in the world, and often, they are surrounded by sycophants who keep reminding them of this ‘truth’. Get over it. As you go along in life, you will realize that there are many who are as good as you and even some who are better than you. If you have not met anyone yet, you have either not been exposed to a wider audience or your ego is writing cheques your body can’t cash (okay, I ripped that straight off Topgun). Taming your ego is the most critical requirement to keep moving ahead. Remember, unless you work on bleeding edge research, no one really needs a genius. Most companies need ‘smart’ people who ‘work hard’. Infact, I’d much rather have 3 ‘smart’ and ‘hard’ workers in my team who gel with each other instead of 1 ‘genius’.
- Keep your boss happy: For many, it’s ‘fashionable’ to trash their boss. Your boss may be incompetent, lame or useless in your eyes. Just remember:
- Your boss is your career path, as long as you are under him. Use it as a bridge instead of hacking away at the steps.
- More often than not, there is a reason he is your boss and not the other way around. Your boss may actually be incompetent, or, maybe, you just think you are the only person who does real work in the company and you wonder why you are not the CEO. (In which case, that usually means, ‘Wake Up’)
- Use Email for correspondence, not communication: Really, this is one of the most important ‘inter-personal’ skills in the Internet Age. If you have a problem with someone, if possible, walk to his desk, or pick up the phone. The worst method to solve the problem is to continue a conversation over email. Remember this: email does not show emotions. Use it to exchange data, but not to resolve arguments or issues. More often than not, your email can (and will) be misinterpreted. This problem is compounded when you have multiple folks participating in that mail chain. Everyone gets defensive when a lot of people are involved.
- Take your performance reviews seriously: Lots of folks think ‘performance reviews’ are a time when they can show their ‘protest’ by not filling up their reviews well or putting in one line corny responses. It’s a message to their ‘boss’ saying ‘look – I really don’t care. I think I am above all of this’. This again, makes the list of ‘stupid things to do’. It is your career. Push it and track it ! As your boss, I will try and push you to the right direction, but you should be willing. If you have a problem, discuss it. If you have a question on how your career is shaping, bring it up ! It takes two to tango. If you keep up with the ‘indifference’ assuming that golden opportunities will be laid at your feet, just because you think you are worth it, you are in for a rude awakening. If you don’t shape up, someone else will take your place. Don’t grumble if you lose your spot then.
- Take Lateral responsibility: I’ve always been a very strong believer in taking lateral responsibility. By lateral, I mean expanding your scope to do something that you never did before. If you are a great engineer, after a few years, try your hand at some customer interaction. Or try your hand at some project management. Again, try it before you trash it. Not everyone can do this. Fine – but if you are willing, the more areas you have hands-on experience in, the better you are in becoming an all-rounded corporate individual.
- Keep yourself honest: What you do unto others will eventually circle around to you. As I mentioned before, remember this: jobs come and go, friendships last for ever. Never do something that could tantamount to back-stabbing those who have put their trust in you. A successful career is built on trust and ethics. It is just not worth it to go any other way.
- The air is thinner at the top: As you rise, you will notice that to get higher, you will have to realize that its not just about you. To rise to the very top, besides being excellent at your job, you need to be able to gel well with the rest of the management team at your level. You need to have good equations with those who matter, whether you like it or not. And finally, even if you are perfectly qualified, there has to be an availability in terms of need as well as budget to move you to this new slot. You are no longer one engineer amongst thousands where jobs are a-plenty. You are now vying for one spot amongst probably only five or ten in the company. Competition gets tougher here - and how well you do your job is just one of the various dimensions you are judged on. This isn’t a perfect world, my friend.
- Don't sweat things you cannot control: As you climb the corporate ladder, there will be many things that may bug you. Don't sweat things you cannot control. Over a period of time, every things evens out. In your initial career path, promotions, growth etc. is very linear and predictable. As you keep growing, you will see your career depends on many other dimensions. As long as you keep your focus and keep working away at your goals, over a period of time, everything evens out. So don't analyze your career in days or months. Track it over a few years and work towards the goal and do what you need to achieve it. Ignore stuff you cannot control - thinking about them will only aggravate you - and trust me, there will be many such things as you continue your path.
- Never burn bridges: When you leave groups or organizations, always make sure that you leave cordially. Many people leave in a huff almost to prove a point ('See, I can get a better job - you folks are not worth my time!'). The point is, this is a very small world. You never know if your new job works out, or, in future, if you will ever have to meet or work for the same people you left. You just don't know. I've had situations where I have had horrible bosses, and I moved on to other divisions - however, by keeping good relationships, those same people have passed on strong references to other companies I was interested in working with a few years down the line. Bottom line: Don't convert work problems into personal problems.
- Always strive to be the best: Above and beyond all, always strive to be the best in your chosen field. Read a lot - keep a track of everything that is going on in your technology. Don't just limit yourself to the work given to you. Stretch out ! And oh, you will always find people who seem to rise just by 'personal relationships'. I know, its irksome. Let it go. Eventually, if you are really good (and no, it doesn't matter what you think of yourself, it's what others think of you), you will reap in rewards far above others.
Sunday, December 11, 2005
In my previous article about IPTV, I noted that very soon, revenue will be all for those who own the user content. Even though 'providers' would likely lose money on individual revenue streams (like voice, TV), business from 2007 would all be about 'service bundling'.
This week, I read three somewhat predictable articles:
a) Yahoo! offers PhoneIn and PhoneOut services - cheap voip based calling in response to Skype's SkypeIn and Out services. While that is ho-hum, what is interesting is that Y! plans to charge a measly 1cent for phone calls within 'developed countries' and 2-3cents in other countries.
b) Adding to the melee of Carriers going VoIP, BellSouth lauches VoIP calling based on 8x8 solutions
c) Update: 12/12/05: Microsoft enters a partnership with MCI to deliver PC-phone calling
Let's step back and talk about the bigger picture. It is not just an ad-hoc 'me-too' trend of people jumping into the same bandwagon. It's the sign of a trend.
But first, the infrastructure question:
Is the infrastructure ready to deliver ?
Broadband Internet is coming of age. Liechtman Research reports a very healthy growth of broadband here in the US. Relative growth trends can be seen around the word, developed and developing countries. One of the critical areas of success for voice and video over IP is the availability of high speed IP links to the user. Unless your last mile is capable of delivering a fancy service, that service will soon be written of as a loss making proposition.
As a testament to the success utilizing the Internet to deliver voice, Vonage took a plunge and a few years ago rolled out its VoIP only service. It works, and works well. This was needed for the industry. Whether Vonage eventually succeeds, gets bought out or goes under as the biggies push their way in is another matter. They proved to the community that phone over IP works rather well. And if it did not work, you would not be seeing a scramble by the larger names to deliver voip.
So lets put aside the question of is the infrastructure ready. Yes, it is ready enough to be able to deliver.
So What is going On ? What is the Trend ?
The million dollar question. First lets look at who all are diving into this battle of 'voice over IP'. This is not a comprehensive list, just a list to show a variety:
- Search and Content - Google - a search and content delivery company. Makes their money, for the most part out of advertising. They launch google talk, and then hire Sean Egan, the lead developer for GAIM to work for them. In addition, they think great things will happen with their Google Talk program, and launch a dedicated blog to discuss their product.
- Search and Content - Yahoo! - similar profile to Google. They lauch SIP based communication with their Y! Messenger and then launch their phoneIn and phoneOut service at ridiculous costs
- Desktop/OS kings - Microsoft - the king of the desktop world. In the early 2000s they launched their Live Communication Server to deliver voip along with Windows, then fell silent after a while. Recently, they snatched up Teleo to accelerate their VoIP story, again. And today (12/12/05) I also read that they will also deliver PC-phone calling with MCI.
- Online sellers - Ebay - pretty much the de-facto standard for online selling/buying purchased Skype for a ridiculously high amount.
- Cable providers- such as Time Warner and Cablevision - traditionally playing in the TV space steadily tread forward in introducing VoIP (they are one of the most feared community, since they own some of the highest speed networks - fiber- today)
- Traditional Voice Operators - SBC, Cingular, MCI etc. all jumped into the VoIP space for a while
Now that all seem to be eager to step into each others toes. Why ?
Ask yourself this: Let's assume that it is a given that there is this high-speed, reliable network around the world that is essentially ready for everyone to use and you can deliver anything over it.
- What then, stops a content company to provide a great search to their users for locating a great TV clip from all the TV stations of their world, then, for a subscription fee, delivering the TV episode over the Internet ?
- What then, stops the cable network from adding interactive TV to the standard TV programming package while at the same time, using the TV as a great video screen for making a video call to a friend while you watch a program that you like and want to share ?
- What then, stops a company, that never was a Telco, to partner with a hardware manufacturer that builds an IP phone that looks just like the one you have today, but just that it works over IP, while at the same time offering you a neat one-number reachability no matter where in the world you travel ?
Convergence is all about creating new opportunities. It's all about delivering great new things to the end user. And don't forget, its all about striking fear into the hearts of established businesses.
The message is clear: He who own's content owns the money. For several years, content has been fragmented because of the infrastructure. It was just not ready to deliver bandwidth rich content to users (we are not taking T1 enterprise links, we are talking home users).
Businesses now need to re-think what it takes for them to stay ahead of the game. They are suddenly being attacked by other segments in the battle for user co
ntent. It's not just voice. It's not just data. It's not just video. It's not just mobility. It's a service that is capable of bundling all of these attributes into a service bundle.
The writing on the wall is inevitable - since attribute providers will be wiped out by a cost game. If you are an SBC, offering only VoIP for $20 a month, a TimeWarner+Google combination will step into your space that offers 'basic cable TV + VoIP + Video Calling + a my user portal which can be set up to customize its services based on user viewing/browsing habits' all for $19.99. Oh heck, to add to it, also throw in a Music On Demand service for your new iPod Nano for a measly $2 add on per month.
A 'single stream' service provider cannot compete with price - they need to stay above the red, while VoIP is the only service they have. On the other hand, these new content combinations have the benefit of hedging their losses + profits across multiple service streams in their bundle. And on top of that, they will likely amass 3 times the customers a 'single stream' service provider can target.
Get the picture ? Get innovative. Think user content. Stop thinking only telephony.