If telco fears are realized, service providers not offering the latest in Web 2.0/Voice 3.0 content and connectivity could be overtaken by the Googles and Skypes of the world. But many service providers, even the CLECs, which often are viewed as being more forward-thinking than incumbent telcos, are taking the hype in stride. Yes, they know they need to provide unified communications, and some do. And sure, they’re keeping an eye on social networking opportunities. But a new study of telcos by IBM Corp. shows service providers, while aware of the new Web 2.0/Voice 3.0 trends, have been slow to incorporate them because revenue from their bread-and-butter service, voice, hasn’t dropped off as pre-dicted. And, as a rule, telcos aren’t willing to mess with what works unless the new technologies prove their worth as money makers.
Defining Web 2.0/Voice 3.0 applications can be tricky. Making the business case for implementing such capabilities can be even trickier.
Web 2.0 generally refers to blogs, podcasts, wikis and so forth. But there’s crossover now as Voice 3.0 joins the fray. Voice 3.0 goes beyond live, one-to-one conversations over IP networks to include multimedia interactions across time and devices. Presence, unified messaging and desktop conferencing represent some of the applications converging to create new dynamics for enterprise and mobile workforces. It all sounds exciting, but many of these applications are so new that many telcos are opting to wait a while and see what lasts.
“It’s kind of like the Wild West of the late ’90s again with startup after startup that has another tweak on the same old story,” says Ken Shulman, CTO/CIO of Broadview Networks Inc., a CLEC in the northeastern United States. That said, Broadview, which targets the SMB space, won’t add new services just because they’re cool. Still, when it comes to Web 2.0/Voice 3.0 applications, “it would be a terrible mistake to not recognize where things are going and not do something about it,” Shulman says. “The challenge,” he adds, “is not just jumping on a bandwagon, but understanding what bandwagon you’re jumping on and why.”
To that end, Broadview already offers (and says sales grow 100 percent each year from) hosted applications including UC, IP contact centers, voice-over-Wi-Fi and fixed-mobile convergence. It’s also experimenting with speech-to-text software like the kind SimulScribe Inc. is perfecting.
According to the results of IBM’s survey, conducted by the Economist Intelligence Unit, Broadview is on the right track. Hosted applications are easy to use and, along with device management, “are all central to the delivery of new content and advertising-based services … but they are not yet key priorities for many service providers,” says Noel Taylor, general manager and global communications sector leader for IBM Global Business Services.
For one thing, upgrading networks originally designed for voice communications and Web browsing is expensive, says Marty Slatnick, telecom solutions lab manager for IBM. “The returns on these network upgrade investments remain uncertain and are likely to be positive only in the long term,” says Slatnick.
Spokane, Wash.-based OneEighty Networks agrees. The CLEC sells unified messaging but is waiting to roll out more extensive applications. “We need to see the business case develop first,” says CEO Gregory Green. “Otherwise, it would be like putting the cart before the horse.”
Another small CLEC, Access Integrated Networks, is in the same boat. Technology and customer demand have to be aligned, says CEO Vincent Oddo. Right now SMB demand for Web 2.0/Voice 3.0 applications isn’t high, but he sees that changing “rapidly” over the next few quarters.
Some analysts seem to have drawn the same conclusions. For example, last year, Burton Group senior analyst Richard Monson-Haefel held a telebriefing during which he said there doesn’t seem to be a good business model for Web 2.0 at all. Corporations might use blogs and wikis for internal purposes, he said, but those don’t generate sales unless the companies in question run social networking sites or are the next YouTube.
But for those telcos that can justify investment in Web 2.0/Voice 3.0, partnering may be the way to go. Indeed, 72 percent of the telco executives polled by IBM said service providers must pair with outside companies such as search engines, content creators, outfits that help provide targeted advertising, and the like, to be successful in a Web 2.0/Voice 3.0 world. CLECs couldn’t agree more.
“If anything, these Web 2.0 companies will need to partner with CLECs, not compete against them,” says Chad Couser, a spokesman for XO Communications. “They won't have the networks with which to deliver these services unless they partner.”
Couser says XO has partnered with Sotto Wireless, which provides a platform combining cellular voice/data and office phone features, to offer Voice 3.0 applications. The companies are providing the so-called Unwired Office, which combines a PBX system, broadband and mobile phone service so users get the same communications experience inside and outside the office, and whether they’re on fixed or mobile networks. The service will be available initially as part of a trial in Seattle.
Those kinds of services are only the beginning of the Web 2.0/Voice 3.0 trend. IBM’s survey found that more than half of respondents expect to see continued convergence in messaging, location, presence, conference calling and more. Yet IBM warns that service providers shouldn’t lose sight of customer requirements as they embrace new technologies. "[S]ervice providers will need to place greater emphasis on ease of use and simplicity despite the underlying complexity of the services and devices, and support it with outstanding customer service,” says IBM’s Taylor.
Access Integrated Networks www.accesscomm.com
Broadview Networks Inc. www.broadviewnet.com
Burton Group www.burtongroup.com
Google Inc. www.google.com
IBM Corp. www.ibm.com
MySpace www.myspace.com
OneEighty Networks
www.go180.net
SimulScribe Inc.
www.simulscribe.com
Skype Ltd. www.skype.com
Sotto Wireless www.sottowireless.com
XO Communications Inc. www.xo.com
YouTube www.youtube.com