ITAC president Bernard Courtois used a line at one of our conferences saying that he was concerned that fighting about telephony competition was similar to creating competition for buggy whips: we’re fighting over an obsolescent product.
His words are gaining momentum as a report comes out from Technology Futures about their forecasts for transformation of the ILEC networks. In the report, TFI states that ILEC access lines in the US fell from their peak of 187 million in 2000 to 169 million at year-end 2004. The total is forecasted to fall to 71 million by 2010!
The report predicts that by 2010, about 75 percent of U.S. households will have broadband service, and about 12 percent of households will subscribe to very high-speed broadband (at least 24 Mb/s). “Since we last updated the report in 2003, a major change in perception has occurred in the industry,” Dr. Vanston said. “Before, our forecasts of distribution fiber, very high-speed broadband, VoIP, IP video and HDTV video were regarded as speculative. Now, it’s a question of how fast. That’s what this report addresses.” As an aside, I note that Cable TV has a broadband pipe into the majority of Canadian homes already, delivering HDTV, VoIP, very high speed broadband.
The research was sponsored by the Telecommunications Technology Forecasting Group (TTFG), a consortium of telephone companies comprised of AT&T;, Bell Canada, BellSouth Telecommunications, Qwest and Verizon.
I find it interesting that the report, Transforming the Local Exchange Network, won’t go so far as to predict the answers, or hints of answers, for how ILECs should upgrade. In other words, with competing visions of different fibre architectures, wireless, etc. – ILECs need to place some hefty bets on transforming their networks to what? All the report says is “the best way to do it depends on a number of factors and the ultimate winner is still unclear to the dispassionate observer.”
In the meantime, should the telcos be seeking equal access to the cable plant? What if cable companies were forced into an unbundled network elements regime? That would let the telcos use a reseller economic model to build customers and upgrade their network as a network optimization strategy. It would also buy the telephone companies some time for a winning technology solution to emerge.
Unbundling the cable loop. Now that would be a fun regulatory battle!