|Issue:||North America 2005|
|Topic:||Convergence, the law and the future of the ICT sector|
|Author:||John R. Janowiak|
|Organisation:||International Engineering Consortium (IEC)|
John R. Janowiak is the Senior Director of the International Engineering Consortium (IEC), a nonprofit organisation headquartered in Chicago that serves as a catalyst for progress in several high tech industries through its presentation of educational conferences and technology exhibitions that link industry and academia. During his 20 years with the IEC, Mr Janowiak has held a number of leadership positions. In his current role, Mr Janowiak is responsible for executive and university relations; international market development and technology transfer between industry and academia. In this capacity, Mr Janowiak serves as IEC’s principal liaison to many information industry corporations and non-profit organisations.
Rapidly accelerating convergence has service providers, carriers, content producers and manufacturers working intensely on triple play–voice, video and data network–architecture, content and applications to attract consumers. As quality improves, VoIP is eroding traditional voice services and threatening traditional telcos. Digital video recording, which lets TV watchers choose when to watch their favourite shows, and IPTV will profoundly change traditional broadcast models. Old-line telcos and broadcasters alike will have to continuously re-invent themselves to face the new competition.
Most of us have probably seen old newsreels from the 1950s and 1960s, where some futurist predicted that in a few short years we’d be commuting back and forth to the moon in our rocket cars, or that we would all own robots that would free us from household drudgery. So my fellow earthbound commuters, as we spend our weekends vacuuming, doing laundry and raking leaves, this much is obvious: peering into the future is, at best, a risky operation. The crystal ball can be especially murky when you look ahead in telecommunications. The merging field of communications and information technology has witnessed a paradigm shift over the past 20 years that has only in the past several years, begun to show any sign of what may lie ahead. The current buzzword, of course, is convergence; it has been convergence for some time, even through the recent economic slowdown where a more realistic buzzword was probably ‘survive’. Now, as economic conditions improve, the merging of information and communications is getting closer to reality. We see the evidence at our educational conferences in Europe, North America and Asia, which feature the latest network advances and broadband services. We also see it in our associations with the leading world telecom companies. This convergence is rapidly accelerating, and it has implications for service providers, carriers, content producers and manufacturers. As an industry education provider, it’s difficult to imagine a more exciting time–or sometimes frightening time, as some of our conference delegates frankly admit–to be involved in communications. Our conferences, especially over the past year, have been filled with vision of a vibrant future, tempered by the challenge of plotting a course through a fundamentally changed landscape to that future. Today, the industry is working intensely to perfect the ‘triple play’–the voice, video and data network architecture and content applications they believe will drive consumer demand. These kinds of broadband services that are being developed and deployed today, and the next generation planned for tomorrow, would have been practically inconceivable to the telecom executive of 1985. In that year, of course, the dominant form of telecommunications, as it had been for decades, was the traditional telephone. Its network of copper lines reliably linked the world–at least the parts of the world that had those copper lines. The telephone did have a modern companion, the fax machine, whose document transmission capability was already speeding up business and providing hints of the ICT transformation that was already under way. Indeed, the seeds of change were already sprouting. In 1984, the AT&T divestiture moved ahead with the creation of the ‘Baby Bells’, which led to major competitive changes in the US phone market. The personal computer, which had been introduced just four years before, was making inroads. And the cellular telephone industry, which signed up its first US subscriber in 1983, was gaining a foothold. The new competitive landscape had been formed and new forms of telecom were on the scene, though it would have been hard to see how pervasive they would become in such short order. The morphing of the computer into a communications device would have been harder to predict from that mid 1980s vantage. Certainly, the kind of broadband Internet service we take for granted was inconceivable then. The Internet in the mid 1980s was still primarily the province of the US Department of Defense and a handful of university scientists. If you told a friend in 1985 that you were going home to fire up your laptop, surf the web for a bit, and then read your e-mail, you would have gotten a strange look. Thinking about how much things have changed in just the last 20 years makes looking too far into the future a daunting task, especially now, as we are right in the middle of a major transitional period. But there are certainly some compelling trends taking place that will drive the ICT world over the next several years. VoIP will continue to erode the traditional model for voice service. This trend will accelerate as VoIP quality and reliability improve and it represents a threat to companies–MCI and AT&T are examples–which depended on revenue from traditional voice. The remaining companies are betting that the ‘triple play’ of voice, video and data will generate revenues to replace the losses from voice-only. Finding the best way of providing voice, data and video continues to dominate the business and much of the discussion at our conferences. Quite properly, the dot.com bust is now regarded as the failure of bad, speculative, business models. Meanwhile the viable underlying Internet technology continues to advance and create new, more realistic, economic opportunities. More importantly and more fundamentally, technology changes have put the customers in the middle of things in ways they have never been before. Napster provided an example, to the music industry’s dismay, of the power of peer-to-peer file sharing. Digital video recording, which lets TV watchers choose when and where they want to watch their favourite shows, promises to make profound changes to the traditional television model. These developments already make it possible for consumers to dictate when and where they will access content; the coming IPTV (Internet Protocol Television) wave will more deeply extend this trend. Equally as important, the broadband connection has given consumers the ability to create content and present it to a global audience via the web–another threat to the traditional model. When you consider the ever-expanding technology that will allow wireless broadband transmission of content to your phone, computer, or other device it becomes clearer that a fundamental reordering of the broadcast sector is under way. The traditional model of using separate, hard-wired devices to compute, watch TV and make phone calls is slowly on the way out. Like any major industrial change, this reordering has been disruptive, and will continue to be, as cable companies, carriers and non-traditional players seek advantage in the converged field. The changes in the competitive landscape can also be expected to provide opportunities to those companies best able to determine the desires of the market and offer compelling services. In the face of such shifts, some traditional operators are rethinking their mission. BT, which recently sponsored our 21st Century World Communications Forum in London, is a good example of a traditional carrier choosing a bold path to reflect the new realities of converged communications. Its 21st Century Network will be an IP-based system that will replace copper wires with a fibre-based network that will be among the world’s most modern. BT is betting the new network will create a competitive advantage for the company and its customers. The lesson is clear–the old-line telcos must reinvent themselves to compete as media companies or face the loss of competitive advantage. And this reinvention process probably won’t be a one-time experience. Communications companies will need to continually respond. Of course, all companies must remain responsive, but the accelerated pace of technology changes and competition from cable companies will mean added pressures on the communications industry. So what’s ahead in 20 years, after the moon car and gutter-cleaning robot? A European research consortium recently released a report on Life in 2020 which postulated hundreds of ICT devices integrated into everyday life–like small sensors in the clothing of the elderly that would allow their adult children to ensure their safety, or a smart refrigerator that can monitor the food inside and order more when supplies run low. Of course, these kinds of advances are hard to imagine, but perhaps no harder to imagine than viewing broadband content over a wireless phone would have been in 1985. Discussions on our telecom future fill the hallways and panel discussions at IEC events around the globe. Providing the opportunity for world telecom leaders to gather at IEC events and eagerly discuss and debate the future of the industry is among the most fulfilling things our organisation does. The ever-growing numbers of delegates that crowd IEC conferences is the physical proof that this industry is hungry for the types of education and networking that will help it reach this promising, but still hazy, future. We see the IEC’s mission to serve as a neutral forum–a place where the industry can meet and exchange ideas–as more important than ever. Each part of the world has its unique set of business issues, but there are common problems–and common solutions. Additionally, the IEC continues its strong affiliations with industry associations and standards. We are committed, through ongoing IEC programmes, to providing a platform for these groups at our events through a benefits programme. These opportunities to join together and learn are at the core of what we do. That, to me, shows that even as our technical abilities to communicate become stronger and more linked, there will always be value in getting together, face to face, to listen and learn from one another.