This continues a series of burning questions I pose to my readers to hopefully spark some debate in the comments.
Our choices certainly seem greater. We can buy land line, broadband, hot spot, conference calling, prepaid mobile cards and transferable SIM cards from cable companies, utilities (over power lines), VoIP providers like Skype, rural providers, municipalities which provide or subsidize WI-FI and a bunch of telephone service aggregators. Google wants to bid for future spectrum. In the developing world, many private telcos now provide majorityof broadband and mobile services compared to older state run ones. In business, telecoms actually provide nice competitive alternatives in many infrastructure areas to IT outsourcing firms.
But then I read this startling statistic. "90 percent of voice calls in the European Union and 80 percent of broadband Internet traffic traveled at least partly over networks of former monopolies". And in the US, the mobile carriers have a chokehold on innovation (David Pogue of NY Times calls them "calcified") and market access (Verizon, AT&T and Sprint/Nextel have almost 80% market share). And through their Double and Triple play bundling are locking in customers across long distance, mobile, content services.
And it's when they do not have much competition is when they appear to get you. AT&T 's $3+ a mobile minute when you call back to the US from several countries. Verizon's large WAN charges to businesses where most IT outsourcers cannot match their capabilities.
The EU's approach to telcos appears to be more regulation. In a stunning move it recently capped mobile roaming charges across all its 27 member nations. (Not sure if it applies to US carriers. I just checked AT&T Wireless site and its call back rates from Europe have not dropped). The EU is now looking at forcing former state run telcos to separate legally from their transmission networks to give competitors equal access.
What do you think? Is the EU on the right track? Do telcos inherently have monopolistic DNA and need to be regulated? Or is that 90s thinking? Technology advances and disruptive new vendors will help keep telecom competitive?
Post your comments below...
