I read this week's BusinessWeek cover story called Telecom: Back From The Dead and I couldn't help notice how they glanced over the RBOC's shrewdness to get rid of their only real competition for wireless and wireline - the former telecom providers like AT&T, MCI, and Sprint. Here are a couple of excerpts from the article which got me a little fired up:
If the old telecom world was dominated by bloated regional monopolies, the new world is a competitive mosh pit stocked with sinewy players. That's reflected in how much more productive the industry has become. While telecom revenues are now 19% higher than they were in 2000, that money supports just 1.1 million workers, down nearly 30% from boom-era levels. "It has gotten unrelentingly competitive in every area: broadband, land line, and wireless," says AT&T's new CEO, Randall Stephenson.
For the big carriers such as at&t, Verizon, and Qwest, the main challenge is to slow defections of traditional land-line customers while producing faster revenue growth in new markets such as wireless, Internet service, pay TV, and advertising. The carriers must overcome their reputation for being "dumb pipes" and prove they can fill their networks with innovative bundles of products and services that strike a chord with customers-
I really beg to differ with the new, new AT&T's new CEO Randall Stephenson. There is less competition for the services he's mentioned not more. His comments are ridiculous and just political spinning so they can go out and gobble out more companies whenever they can while the FCC barely pays attention to their own data. There may be competition on the data and infrastructure side which is outlined in the article, but there is no competition less than 30 minutes from the old AT&T's and now current Verizon Corporate HQ in Basking Ridge NJ.
The article lays out the RBOC's strategy for the past 10 years as shown on that second paragraph above. (My words first) Get rid of the real competition so that it is easier to slow defections of traditional land-line customers
while producing faster revenue growth in new markets such as wireless,
Internet service, pay TV, and advertising.
Back in my earlier career at AT&T, we were taught the 5 P's of marketing: Product, price, place, promotion, and POLITICS. There was plenty of marketing back in those days - do you remember them? The phone calls, the offers, the price wars, and etc. Those are gone? Why? Because the Baby Bells were better than the old AT&T, MCI, and others in working the political angle and the RBOCs were able to enter the LD/Internet market while making it nearly impossible and costly for the LD competitors to get into their market. Now a few years later, they don't market unless it is a new service and certainly don't spend any time on wireline programs. That world is silent.
Is the country better off? I don't know. Again, back in the day, there were grumblings that people didn't want to deal with switching providers and it was all just a game. Well a few years later, the game is over and the RBOCs face no battles over their turf. This allows them to expand and spend on new areas, while it totally turns wireline into the cash cow that they always thought it should be. They get to set prices at whatever they want, cut back on headcount, lower marketing all while spending in growth areas. That's what brought them back from the dead.
Don't believe me? Well ask a veteran of the telecom wars from the 90s. Need something recent? Check out this interview with AT&T new CEO Randall Stephenson where he slips up (yeah right) and says IPTV will be our next multibillion-dollar revenue stream. We're working hard to have the largest video platform in the U.S. [AT&T later clarified to say that statement applies only to the states it serves.]. They only need to focus on their own area which is a huge competitive advantage and that's courtesy of the FCC.