Thursday, May 26, 2005

Voice Apps and Infrastructure Parting Ways

Leonardo Faoro - The VoIP Weblog



With the advent of VoIP and the entry of service providers that only provide voice applications (like Vonage) and not network infrastructure bundled with applications (like SBC and Verizon), there’s a growing distinction between applications and networking. Where they were once delivered by the same provider, we’re increasingly seeing voice systems designed independently of the network transport.

There’s something intrinsically liberating about it. Consumer choice. Increased competition. Better voice applications. Lower prices.

Infrastructure supporters (like SBC and Verizon) can concentrate on what they do best: maintain miles and miles of cable. Application providers (like Packet8, Vonage, and Skype) can concentrate on what they do best: building cool new voice applications.

Martin Geddes has an interesting metaphor supporting this concept that I discovered on his blog:
Telecom. Bad news — they’re getting a divorce, into Tele (the connectivity) and Com (the application). Good news: Divorce makes for good business for the family lawyers. Bad news: Com was making all the money, but just got replaced by six guys from Estonia armed with laptops. Worse news: Tele was cross-subsidised from Com. Terrible news: Tele is fundamentally impossible to fund from network operation. Need new ownership structure that aligns interests of network users and owners.

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