By Nathan Franzmeier, President, Stratus Telecommunications

"Just as war is freedom's cost, disagreement is freedom's privilege." – President Bill Clinton

Skype is here for free – and not only free of cost. Free of extra equipment. Free of indirect connectivity. Free of the media sharing restraints that hold back traditional landline connections.

Unfortunately, Skype’s benefits are coupled with a major negative: The free service is restricted to computers and Skype-enabled devices. And while more than three quarters of U.S. homes have computers in them, general telecom accessibility extends well beyond those borders – and that costs money, for now...

With increasing international competition and the trend toward open standards and open source, telecom equipment providers are constrained from charging a premium for hardware and software. The real costs of IP and voice transport continue to drop, and so do the margins. Most of the transport infrastructure is not intelligent and many of the incumbents charge “by the pipe.”

The trend of the past few decades has moved away from the centralized intelligence of mainframes and core switches with “dumb” edge devices (like terminals and POTS phones) and toward a structure of distributed intelligence with a “dumb” core and computers, smart phones and intelligent service nodes at the edge. The revenue from services provided over the network has shifted toward the edges to the new breed of service providers like Skype, Apple and Google.

The end result: a war is being waged within the network. The incumbents are searching for new ways to monetize data streams traveling through their pipes which – for the moment – are open and practically free. These well-financed vendors are spending time locking down the network by building intelligent infrastructure to monitor traffic. Meanwhile, these incumbents continue to lobby the government for legislation that would allow them to monetize this traffic. On the other side are “net neutrality” advocates who argue that data should be free to travel over the network without interference. Advocates for this side of the argument (along with their own government lobbyists) use encryption, data spoofing, and other technological weapons to defend their territory.

Ultimately, the decision will come down to the government as the only body with the regulatory power to say what is allowed for free and what will cost money. Increasingly cheap technology is driving the price of communication toward zero. Meanwhile, both sides are working to offset this trend by competing for the ever-increasing dollars associated with the services being offered in the network.

Nathan Franzmeier is president of Stratus Telecommunications, a provider of VoIP and converged service solutions for telecommunications service providers around the globe. Prior to the company’s recent spinout from Stratus Technologies, Nathan was senior vice president of the Emerging Network Solutions group at Stratus Technologies for two years. He also was founder and CEO at Emergent Network Solutions for four years prior to its acquisition by Stratus Technologies.