Stardust Global Ventures

For anyone who’s been following my recent conversations, you know that VoIP (dead or alive?) and the Telco paradigm have been central topics lately. There’s a reason for that, and we’ll get to it in this post.

My friend Thomas Howe, one of the sharpest minds any of us will ever meet, stepped up to the challenge and came back with some compelling arguments. Here’s his latest:

The Smart Money’s on the Telcos
Far from facing extinction, I firmly believe that Telcos have a bright future, and if you are interested in innovation, and in moving communications forward, you simply must include the Telcos in your ecosystem and value chain.

I’ll wait a minute while you catch your breath. For those of you in the United States: if you have pains running up your left arm, please stop reading, grab that evil corporation supplied phone, and call 911.  And, as I’m sure somebody is thinking, I didn’t have a stroke myself. At least, I don’t think I have… my speech is always slurred.

Earlier in the month, my friend and respected thinker Ken Camp posited that Telco 2.0 was a flawed delusion, and I cried foul. (OK, I cried bullshit – and all I’ll say about that is that I won’t hesitate using that term with my own wife, so Ken’s in good company.  Ok – that’s not true either- but only because she’s within arm’s reach and takes Karate.  If she lived on the other side of the country and was not trained to kill geeks like me, I would call bullshit. But I digress.)  In short, Ken’s assertion was that Telcos are a doomed industry, and it was nonsensical to believe that a doomed species would evolve into something better.  Ken further suggested that the points that social media required were exactly what a telco could not provide, and since future communications was based on these principles, the closest analogy to operators were dinosaurs, and they were on their way out.  I blew up, not because I disagree with Ken about how our market should change, but because I believe Ken disregards some fundamentals, because I don’t think that telcos needs the ability to change with the times (no complex organization, biological or not, actually can) and because I’ve been recently memorizing (literally) Richard Dawkin’s excellent expose on evolution (The Selfish Gene) and Nicolas Carr’s future vision of technology (The Big Switch).
[Read Thomas' Full Post]

I suppose people reading along might get the misperception that Thomas and I are adversarial, but that’s not the case at all. We love a good, animated debate, and in “arguing” over topics like this, we all come to a better understanding. And at the bottom line, it’s all about semantics.

The field of telecommunications is both mammoth and complex. Consumer services, business services (Enterprise vs. SMB) and carrier services are all very different businesses. Each carries a unique business model, and a set of challenges quite different from the others.

When I started this brouhaha with my VoIP is dead posts, I intentionally fanned some flames and took a strong adversarial opinion, but it wasn’t contrived either. I truly believe that too many companies in the innovator space lead with VoIP as a key part of their message. VoIP is a strong argument inside the industry. To a carrier or technology partner, knowing the framework is based on VoIP or SIP as the underlying architecture is a key facet in thinking about services and solutions. To a consumer, the technology is far less relevant. Some companies speak to VoIP very well. Others send a mixed or weak message. I don’t like seeing weak or flawed messages being used by companies who could do so much better.

VoIP isn’t dead, but it is plumbing. It’s infrastructure. It simply is. I’ve been saying for almost three years that VoIP is a building block mainstream component of the telecommunications infrastructure. It’s as much a part of the PSTN as it is of the Internet today. And are they really separate any more? The two clouds have blended together over the past several years and are more interwoven than most people realize.

I also took the position that the Telco 2.0 paradigm is a flawed one. I believe that. That paradigm is based on a legacy business model that is obsolete and must change. I never said they’re extinct.Not yet. But I believe the legacy telco paradigm is broken beyond repair because it is outdated beyond recovery. And I believe the players in that space have all but proven they cannot keep pace with the changes.

I believe the industry has undergone a revolution already and the strength and power lie with the innovators and end users, not the carrier telcos. The innovators deliver tools. Powerful tools. Sometimes they deliver solutions. Sometimes they deliver parts. And many times end users assemble the parts to creat a solution. Well over a year ago I described this as Click to Converge. That trend has neither reversed nor slowed. It has accelerated.

As I read Thomas’ latest post, he echoes my thoughts in different words. We’re on the same page. He speaks of “Communications as a Service” and my eyes light up. Not VoIP. Not telecom. Communications. As a service. I’ve been harping on that message for at least three years.

I’ve referred to Thomas as the Mashup King for good reason. He understands not just the value of combining resources, but how to actually do it. But I’ve many friends in the industry who seem to struggle with some simple semantics.

It’s called convergence. We’ve called it that for at least ten years now, and it’s been happening all around us. And the spin doctors of telecommunications, which we now prefer to call unified communications (more cutting edge, you know) all have their own spin, creating fear, uncertainty and doubt (It’s called the FUD Factor in sales. It’s a weapon of intimidation.) in the minds of end users around the world.

I don’t believe VoIP is dead. I just feel it’s a useless and almost entirely inappropriate way to lead into customer solutions of high value. It’s not the message, it’s the foundation technology that makes the solutions possible. I don’t believe telcos are dead…yet. But they’re a dying breed; slow, lumbering beasts of burden that cannot innovate quickly. What they can do is scale and deliver pricing, but they have to leave some old habits behind to do so. Some are learning slowly. Some will never learn.

The bright lights in the communications industry do not exist inside the telcos anywhere. There is not a bright light anywhere visible in telco R&D. The telcos are like a fog surrounding the bright lights that exist, enshrouding them in a mist (think FUD) for the most part. That said, there are some glimmers of genius in the telco behemoths as well. See the recent news about colleague Marting Geddes new role guiding BT into the future. If they’ll listen to Martin, truly listen, they will thrive.

Bright lights are in pockets of innovation. In nimble entrepreneurial companies hustling to deliver real value-added services. These bright and shining stars are the real thought leaders in the industry. They’re the root and heart of innovation and next generation communications. They’re the companies I watch closely. Sometimes I mention or write about them. Sometimes I just watch to see what’s next. Sometimes I criticize, but I’m always optimistic because of companies like these.

Voxbone – Making carriers think about new ways to deliver service. Selling cutting edge new ideas to carriers as customers.

Voxeo – IVR, IVR, IVR. Voice applications. Voice. While I’ve written quite a bit about how some of my friends new services demonstrate the power of voice in accessing network resources, I believe the first really new VUI (Voice User Interface) we see with tangible business power (read that as “a moneymaker” will come out of the Voxeo developer community.

Truphone – Ok that will surprise some people, and I’ll probably hear from my pal Andy for this later. I think Truphone has huge potential. I think they articulate the message poorly and I think they’re a bit shortsighted in their vision. I’m not convinced the leadership team there is the right mix to leverage their potential, but the potential is very large. I like their potential more than I like the way they deliver their message today. I’m often frustrated by their unrealized potential.

MOBIVOX – Already well on the way, but they’re an example of Click to Converge thinking that I believe will lead the next generation of communications. They’re smarter than any telco I’ve ever seen. They have vision.

Jazinga – I haven’t seen enough of how their early evolution is holding up, but they’ve pulled together the right idea at the right time to deliver a solution to SOHO and SMB users around the world. As long as Cisco doesn’t acquire them (the kiss of death) and they keep progressing, they are going to be huge.

Others? Sure, there are plenty. And I’ve got an eye on a couple of new startups still in stealth mode than I think are going to shake things up yet again. But these five are very high on my radar – companies to pay attention to. Not because they’re making a gazillion dollars. They aren’t. Not yet. But these represent the thought leaders in communications of the next generation. They’re our real potential.

There’s another facet that is simply not fully understood yet. This odd new animal we call social media. I maintain that unified communications, in a pure sense, can’t exist without social media. Social media can’t exist without unified communications. Their fates are tied together. The impact and evolution of social media is grwoing and gaining momentum. But what is social media really? Communications.

They’re the bright lights. And as they say in the movies – walk into the light.

Note to Thomas – Thanks for joining in and helping me find new ways to articulate what I was thinking. Next time we broach this topic, let’s swap positions and each argue the other side. I think we’d have fun and uncover lots of new ideas.

Technorati Tags: Thomas Howe, Voxbone, Voxeo, Truphone, MOBIVOX, Jazinga, VoIP, telco, unified communications, communications. social media