Competition. It's the hallmark of a healthy market and a boon for innovation. It's the foundation of capitalism.
And it can be really, really scary.
Not always scary in a bad way, but certainly unsettling for companies that, for years, have enjoyed market domination. For years, now, Pipeline has devoted an issue to the ongoing struggle between cablecos and telcos, who are, increasingly, battling for the same bits of market-share. Moreover, we were planning on speaking to the proverbial second front that both types of companies have been dealing with from over-the-top providers.
However, providence has interceded and given us the gift of two major stories that have helped to change our point of reference, somewhat. We'll unpack these stories in greater detail, but first, let's talk background for just a moment.
For years now, cablecos and telcos have been shaking free from their traditional core business proposition to become providers of a
For years now, cablecos and telcos have been shaking free from their traditional core business propositions.
This may just be a hallmark of evolution. Perhaps all voice will soon be VoIP. However, this growing lack of any discernable technical difference between the cable and telco voice experience is notable. Trefis analysis reports that traditional landline voice service is responsible for about 15% of AT&T's current stock value, and just 8% of Verizon's. That's for residential and business customers.
total network experience. They've become providers of an entire multimedia lifestyle, fueled by their access into consumer homes and businesses and a growing demand for services among consumers (which should, preferably, all appear on the same bill with a discount for the bundling.
Now, we already know that VoIP has taken such firm hold in the network, and has become widely trusted enough (in terms of user experience) that cablecos have made real inroads into the voice arena. Furthermore, telcos have been doing more to embrace VoIP, at least through their wireless branches, with deals popping up between VZW and Skype (see Verizon makes Skype Mainstream in this issue) and AT&T and Vonage.
Meanwhile, Trefis reports digital voice as 18.9% of Comcast's stock value.
Cox Communications is another company that has chipped away at telco voice offerings. "Back in 1997 when we launched Cox Digital Telephone, we squared off against incumbent phone companies that had enjoyed a 100-year monopoly," said David Grabert of Cox Communications. "By differentiating on the quality and value of our bundle of services, we were able to take market share in telephony that exceeded all expectations. Today, in Cox's most established telephone markets, we are the number one provider."
Pipeline
Publishing, Volume 6, Issue 11
