Re: UKNM: free local calls baloney

[azeem azhar, lists]

At 12:12 pm +0100 22/6/99, Steve Bowbrick wrote:


>decent chance you won't get a line out of the exchange. I feel some

>sympathy for the hapless telcos trying to marry these two incompatible

>economic models in one network...


Don't. In the US, the profits of the Baby Bells histrocally matched the

termination fees long distance providers had to pay them (e.g ATT, MCI). In

other words, these monopoly businesses were only able to turn a profit

because the regulator *set* their generous profit level for them. They were

slow, stodgy firms riddled with poor product innovation and unclear

strategies; and few supporters amongst their customers. (Viz Pactel selling

its cellular business a few years ago: Homer Simpson moment.)


(And as you point out, customers not telcos paid for universal service

obligation).


And BT, of all businesses in the UK, is the least deserving of sympathy.

Tremendous resources and some really excellent staff *and* a monopoly.

Hapless, its true but hardly helpless.


Point about switched networks is well made. And about pricing, UK vs US.

However, its perceived pricing that is an issue. (Well known that people

will often plump for all you can eat pricing for any product rather than

pay as you go, because they perceive pay-as-you-go to be more expensive:

we're risk averse and this minises our maximum exposure.)


And the fight is by no means over. UK is very well poised for a range of

nice competitive access mechanisms for always-on mid-bandwidth (or better

services):


1. VDSL in big towns, if we're allowed competitive access to the copper

2. Wireless modems (spread spectrum stuff, per www.tele2.co.uk; only more

aggressively priced and consumer marketed); perfect in towns and less dense

cities; as well as countryside.

3. GSM/GPRS over cell phones (expected unmetered mobile access to the net

at a premium-ish price within 12 months)

4. Cable modems (NTL, etc).


This free access over PSTN is a 3 year blip. The free ISPs will need to

turn their IP dialtone into a differentiable service that delivers loyal

customers. (Maybe Freeserve could use IPO proceeds to roll out 1 megabit

wireless modem service for 30 pounds a month....nice idea).


There. I've stuck my neck out.

a



azeem azhar 			| www http://azeem.azhar.co.uk/

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