The Jeff Pulver Blog: More Service Providers Should Consider Becoming 'Broadband Parasites'

« Jeff Pulver Interviewed by JD Lasica | Main | Watch Jeff Pulver and Matthew Goodman on The Jeff Pulver Show: May 29 2008 Episode »

May 29, 2008

More Service Providers Should Consider Becoming 'Broadband Parasites'

Back in July, 2003 in this blog post I first outlined a strategy for wireline service providers (RBOCs and PTTs) which I called being a “Broadband Parasite:” Five years later it turns out Wireless Providers like T-Mobile (in the US) have joined this fraternity by virtue of their support for WiFi UMA, while companies like Verizon and AT&T have not.

I’m re-publishing my blog post in it’s entirety with the hope of inspiring a conversation or two with some of the people responsible for the strategic direction of the world’s largest communication companies. (I’m reachable via emal at: jeffp@pulver.com and via text/SMS over at: +1.516.312.3227

---

“The Rise of the Broadband Parasites” (first published July, 2003)

For those of you who know me, you may recall that I'm a believer of what I call "Lennon/McCartneyism" which was largely influenced from the lyrics from the song "The End" from Beatles Abby Road Album - "...and in the end the love you take is equal to the love you make." From those words I envision a Greenfield opportunity of embracing a balanced broadband empowered world where end user empowerment exists and where people can just pay for access (dumb pipes) and have the freedom of choosing who/what and where their service providers come from. A corollary that in this model, non-traditional service providers will show up and start offering "services." This is happening today as represented by the overnight success of companies like Vonage and this is one of the trends that may in fact help save the communications industry.

In this Greenfield opportunity, the advent of end-to-end IP provides the virtual soil. From this soil, the opportunity exists to grow plants, trees, weeds and more. Fertilizer needs to be provided, the seedlings need to be nurtured and my hope is that we can help control the "weed" population without much (if any) regulation. My hope is that this become a world made available by deregulation rather than new regulation.

With all of this said, my number one rule for those who wish to compete in the Voice over Broadband space is: "Embrace the Technology and Act as a Good Parasite."

"Embrace and Act as a Good Parasite", yes this is what I'm saying.

It wasn't that long ago that a common assumption was that local phone service would always be delivered by the incumbent operator. In the US this was the RBOCs and outside of the US it was the local PTTs

What almost everyone seemed to miss was the fact that while most telecom executives were in the board room making assumptions about running a wireline telephone business, the business of the wireless industry happened and we are at point in time today where 40% of all telephone calls in the US originate or terminate on a cell phone and where this trend may in fact be accelerating. This in turn, plus the emergence of availability of broadband empowerment of consumers has had a noticeable impact in the top line revenue of 2nd line phone service in the US with the RBOCs and the PTTs around the world. There are a growing number of consumers who today rely on their cell phone as their primary phone and don't pay to have any connectivity to/from their respective incumbent operator. Residential 2nd line (and 3rd, 4th, etc.) service has been replaced by the purchase of either DSL or Cable Modem service and/or the increased use of wireless/cellular phone service in the home.

In a parallel time frame, since 1997, the VoIP industry was incubating it's core technologies and the QoS on the public internet was getting better to the point that by early 2002, consumers were for the first time offered the choice of replacing their secondary phone service from companies like Vonage.

From one perspective, revenue prospects for Voice over broadband services look to be on the rise and revenue from traditional phone services look to be on the decline.

So what can be done to fix all of this if you are an incumbent operator?

Put artificial barriers to entry in place to try to slow down the competition? Maybe that works, but eventually it doesn't. A better approach is to embrace the technology head on and leverage it to your favor.

My strategy for the ILECs and the PTTs of 2003 is as follows:

Embrace VoIP and launch a consumer 2nd line phone service inside your territory as a pure parasite play and deliver the service over broadband - both Cable and DSL and play the same game as the other voice over broadband service providers. You don't need to pay for the roll out of the cable plant, or to play for the access for your prospective customers to benefit from. As a pure parasite you gain access without the cost.

Plus people still have a "trust" relationship with you so even if they don't opt-in for your primary phone service, you do make a compelling reason to be the secondary phone service in the home. Did I mention that you also know where everybody lives and you can quickly identify the customers who have left you and can focus on creating enough awareness so that you can gain new customers faster than the startup competition which has to spend significant dollars on branding and marketing.

So start out by offering 2nd line phone service in the territory that you still offered primary phone service and then, if you want to keep the relationship, start rolling out "Purple" applications which enable your new customers with the ability to do more things with communications, things which they could never do before without IP based communications. (Eventually this means that new applications will be rolled out that may in fact be "sticky" enough for you to attract net new customers.)

As far as I can tell, this strategy turns out to be a win/win all the way around for most of the players and would completely validate the ongoing work of the emerging new order of voice over broadband players.

When successful, roll out the services on a national / international basis. The international LD arms of these operating companies can then go local outside of their national territory and help bring communications to a new generation of people.

Just a thought on how everybody can win in this new broadband enabled world.

To keep things even more interesting, think about using the internet to peer between broadband based voice over broadband service providers and wireless service providers. If/when this is done correctly, it will have an impact on the importance and strength of what is and was the "legacy phone network.

---

Five years later and I believe this is a strategy that still works well.

In fact, with the advent of the widespread availability of WiFi, more service providers should consider deploying WiFi UMA. The genius behind WiFi UMA is that it empowers any kind of service provider: wireline / wireless and/or broadband based to leverage dual mode wireless phones and WiFi Hotspots.

While billions of dollars are going to be spent by some providers to deploy more fiber to the home and billions more will be spent to deliver on the vision of Wi-Max, at the same time service providers can choose to do nothing more than add WiFi UMA to their network architecture and start to deliver what will appear to be “wireless services” to the phones of their customers, regardless of their geography and their type of the underlying primary service.

I look forward to a future where more service providers will choose to join the fraternity of also being a “broadband parasite.”
----

Tags: voip, UMA, T-Mobile, WiFi UMA, Jeff Pulver

Posted by jeff on May 29, 2008 08:27 AM | Permalink

Additional resources: #140conf events | Watch the Jeff Pulver Show | Jeff's Qik Videos

Comments

Thanks for the tips! I will follow them closely. Also loved the Beatles reference. Keep up the good work!

Posted by: Personal WaterCraft injuries at January 10, 2012 11:38 AM

Wearing Ugg Boots is becoming a fashion. Both in summer or winter, you can see many people wearing a variety of boots on the street, do you want it ? Do not hesitate . Welcome to the Ugg Boots UK , there are many new boots on sale, and you can find the Ugg Boots UK which you like it.

Posted by: ugg boots uk at December 5, 2011 03:01 AM

Tres bien .j’aime bien vos articles,bienvenue visitez Beats By Dre, Monster Beats, Monster Beats Pro , Monster Beats Studio , Monster Beats Solo HD.

Posted by: monster beats sound at November 17, 2011 09:26 PM

Many people like to listen to songs, for music can clean to people today with the middle sand and mud; it may arouse the heart with the childlike innocence, it can get rid of the heart trouble, so songs direction and producers showed up with the albums for every person to hear. If you tend to be somebody who wants to listen to songs, you might have already heard concerning the dr dre headphones, or most generally known as Monster Beats. Who would have although that Dr Dre would be making and delivering a revolutionary pair of headphones? The type of the Monster Beats By Dr Dre Studio is very good. I think you will like it.

Posted by: monster beats at October 31, 2011 04:01 AM

I am very much content with the items you have talked about.I desired to thank you for this superb information. I experienced every little bit element of it and I will be awaiting the new messages.

Posted by: cubicle curtains at October 21, 2011 04:47 AM

Posted by: qihang at September 22, 2011 10:08 PM

This article is very usefull for me! I can see that you are putting a lots of efforts into your blog. I will keep watching in your blog, thanks.

Posted by: Insulated Cooler Bag at September 15, 2011 03:46 AM

Mike: My aunt was very embarrassed when she was asked to take off her mask at the party.

Mary: Why was that?

Mike: She wasn't wearing one.

Posted by: jerseys58 at July 31, 2011 09:18 PM

This is all very new to me and this article really opened my eyes.Thanks for sharing with us your wisdom.

Posted by: China Inflatable at July 14, 2011 11:46 PM

http://www.24golfstore.com
http://www.24discountgolf.com/Disc-Golf-16640-Callaway-RAZR-X-Iron-Set-3-9PS.html
http://www.24discountgolf.com/Golf-Clubs-29-c0-XXIO-Golf.html
http://www.24discountgolf.com/Disc-Golf-16487-Titleist-910F-d-Fairway-Wood.html
http://www.24discountgolf.com/Disc-Golf-3246-Honma-Beres-MG803-Irons-3-11SW.html
http://www.24discountgolf.com/Disc-Golf-16123-Titleist-CB-710-Irons-3-9P.html
http://www.24discountgolf.com/Disc-Golf-1183-Titleist-AP2-Irons-3-9P.html

Posted by: Golf Clubs for Sale at June 30, 2011 01:01 AM

Posted by: شات سعودي كول at June 14, 2011 12:16 PM

It really an excellent post.It not only make me realize the charmity of words and pictures but also help me to learn a lot.Thank you very much!Looking forward to see more outstanding masterpiece from you in the future.Best wishes.
http://www.franklinmarshallshops.com
http://www.christian-louboutins.cc
http://www.fm-clothing.com
http://www.franklinmarshallt-shirts.com
http://www.fivefingersvibramnow.com
http://www.herveleger-dresssale.com/
http://www.asicsstore.org/
http://www.guccisale.us
http://www.cheapnikejordan.us/
http://www.beatsheadphone.org
http://www.nikeshoesbox.org
http://www.uggoutletboots.us/

Posted by: Franklin and Marshall at May 28, 2011 07:09 AM

iphone covers
iphone covers for 3gs
iphone 4 cases
iphone 4 casing
Cheap Wedding Dresses
Cheap Prom Dresses
Wedding Dresses Shops
Bridal Shops

Posted by: iphone covers at March 14, 2011 12:18 AM

Once again great post. You seem to have a good understanding of these themes.When I entering your blog,I felt this . Come on and keep writting your blog will be more attractive. To Your Success!

The perfect!These articles written too great,they rich contents and data accurately.they are help to me.I expect to see your new share

Posted by: China Manufacturer at February 15, 2011 01:38 AM

Are you interested in [url=http://www.topsalewatches.com/]replica watches[/url] ? These [url=http://www.topsalewatches.com/]cheap watches[/url] can save you a lot of money, if you want to [url=http://www.topsalewatches.com/]buy replica watches[/url], the best way is to [url=http://www.topsalewatches.com/]buy watches online[/url], where you can find the [url=http://www.topsalewatches.com/]best replica watches[/url] , besides there are many [url=http://www.topsalewatches.com/]fake watches[/url] for your choice, for example, [url=http://www.buyreplicawatch.com/rolex-datejusts-watches-c-12.html]replica rolex watches[/url] and [url=http://www.buyreplicawatch.com/rolex-datejusts-watches-c-12.html]replica rolex watch[/url], and [url=http://www.buyreplicawatch.com/omega-watches-c-89.html]replica omega watches[/url]and [url=http://www.buyreplicawatch.com/omega-watches-c-89.html]replica omega watch[/url] and [url=http://www.buyreplicawatch.com/cartier-watches-c-49.html]replica cartier watches[/url] and [url=http://www.buyreplicawatch.com/cartier-watches-c-49.html]replica cartier watch[/url]. All at http://www.topsalewatches.com/ and http://www.buyreplicawatch.com/cartier-watches-c-49.html/

Posted by: asdf at January 14, 2011 03:12 AM

This is a good,common sense article.Very helpful to one who is just finding the resouces about this part.It will certainly help educate me.

Posted by: China Tent at October 8, 2010 10:07 PM

http://www.r-khleeg.com
http://topics.r-khleeg.com
http://forum.r-khleeg.com
http://www.chat.r-khleeg.com
http://www.r-khleeg.com/A.html
http://www.r-khleeg.com/B.html
http://www.r-khleeg.com/C.html
http://www.r-khleeg.com/D.html
http://www.r-khleeg.com/E.html
http://www.r-khleeg.com/F.html
http://www.r-khleeg.com/G.html
http://www.r-khleeg.com/H.html

Posted by: شات الخليج at October 6, 2010 07:12 PM

Zrhprint manufacturer and exporters provide you with high-quality China Printing Services like printed boxes and packaging products at competitive prices from china. Our products are of best printing quality with the best value. We are your partners in low cost and outsourcing for your packaging needs.

Posted by: China Printing at August 30, 2010 04:36 AM

Posted by: Cheap Microsoft Windows 7 Product Key at August 6, 2010 11:24 PM

Posted by: longines watches at March 8, 2010 12:44 AM

Posted by: cheap-ugg at March 4, 2010 03:49 AM

http://www.tiffanycome.com/ Tiffany & Co

http://www.tiffanycome.com/accessories-c-7.html Tiffany Jewellery

http://www.tiffanycome.com/bangles-c-5.html tiffany bangles

http://www.tiffanycome.com/bracelets-c-2.html Tiffany Bracelet On Sale

http://www.tiffanycome.com/cufflinks-c-6.html tiffany cufflinks

http://www.tiffanycome.com/earrings-c-3.html tiffany earrings

http://www.tiffanycome.com/necklaces-c-1.html links necklaces

http://www.tiffanycome.com/rings-c-4.html Tiffany Rings

http://www.tiffanycome.com/watches-c-8.html tiffany watches

Posted by: Tiffany Jewellery at March 2, 2010 06:11 AM

Having been a part of the Online Universal Work Marketing team for 4 months now, I’m thankful for my fellow team members who have patiently shown me the ropes along the way and made me feel welcome

www.onlineuniversalwork.com

Posted by: abass at January 25, 2010 08:33 AM

I find the valuable information is provided by you.

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Posted by: Plastic Card at January 15, 2010 07:15 AM

Hello,
I am Will and just came across your site through search. I would like to invite you for
link exchange deal with my good quality sites, all having different page rank. Please let
me know if you would be interested in pursuing this conversation further. And i will draft
a good proposal for you accordingly.
Thanks,
Will

Posted by: Will at January 9, 2010 02:50 AM

Posted by: injection molding at June 23, 2009 10:56 PM

what i have really been waiting for is the large highly discounted calling card operators(such as sti, lds, etc.) to offer SIP termination as an alternative to the breakin numbers. it is still far cheaper to make international calls with calling cards or dial around(1010+ dialing) than through SIP termination. this is more true to the highest termination cost destinations. i would really like to be able to get these type of rates via SIP.for my basic local landline and mobile service i am quite happy as things are. what i really want see from SIP is absolute rock bottom cost for international calls with insane competition. what little exists is mostly from european operators(such as the betamax companies). when will the huge USA based calling card operators get into the game?

Posted by: tom at May 29, 2008 10:23 AM

May 29, 2008

More Service Providers Should Consider Becoming 'Broadband Parasites'

Comments

Post a comment