Saturday, October 22, 2005

SkypeBaypal and SBC 

Jeff was so friendly to add a link to the collection of my previous post: "Why me worry" , an reply from SBC CFO Rick Lindner to the original Whitman interview at Reuters:

SBC Communications Inc. sees little challenge to its traditional telephone business from services such as Skype that offer free phone calls over the Internet, SBC‘s chief financial officer said on Thursday.

"I don‘t see it as a significant threat," SBC CFO Rick Lindner said in an interview with Reuters. "The fears of what may happen there are overblown."

Linder is whistling in the dark.

In response to Whitmans: "It is very clear that voice communications is moving on to the Internet. In the end, the price that anyone can provide for voice transmission on the Net will trend toward zero."

... Lindner said while some "techies" might want to "scour the Internet and buy applications and services from a number of different providers," the mass market of customers will prefer to buy voice, video and data services from one company on one bill.

True, but maybe he has not heard yet from Visa and MasterCard, and he did not get the message from PayPal and Google Wallet.

"Why has WalMart been successful in areas like groceries? It‘s because its convenient for people to go to one location and buy everything," he said.

Yes, I could even now pay all my communication charges including Internet access on a single bill with my mobile operator, but only over my smoking dead body (and the dead body of my boss). People like it comfortable, but not at any price. There are limits, e.g. a roaming charge of 10 Euro/MB.

Lindner also said consumers will prefer to send calls over reliable networks. Most U.S. telephone network equipment is designed to go offline for no more than a few minutes per year.

"That‘s a big difference from simply relying on the public Internet to handle your communication needs," Lindner said.

This is always the final argument. Ok, I will not come up now with the reliability of mobile networks, especially in the US, this would not be fair, but also the fixed network has its outages.

Basically the Internet is VERY reliable, it is designed to be so. What is unreliable on the Internet is the access, and this could be improved if customers would be willing to pay for it, and second, who is providing most of the Internet access? The telcos and the CableCos. Another source of unreliability is misconfiguration of routers and DNS servers by the ISPs (also mostly by Telcos and CableCos playing ISPs - I could tell you stories ...)

SBC said on Thursday that it ended the quarter with 50.2 million traditional telephone lines, a 5.1 percent decrease from a year earlier, driven by a loss of 643,000 wholesale lines.

If this continues SBC will be on zero in 10 years or so, if they do not come up with something else, e.g. say Internet access, services and application. But if they tell now their customers that this is all bullsh*t, this will not be very helpful. The customers will not buy in to SBC, but to somebody else who is telling them that the Internet is super: e.g. Google or eBay or Yahoo!

Comments: Post a Comment

This page is powered by Blogger. Isn't yours?