The Telecom and Information Technology
SBC, one of the last regional bell operating companies left standing, buys AT&T. That's right, Ma Bell gets eaten by one of its children. Lucent and what was left of the one-time national treasure, Bell Labs, sells out to Alcatel to avoid bankruptcy. Apple, the computer company, gets into music with iPod and iTunes, and then gets into cell phones with iPhone while getting into bed with AT&T. Google starts buying everything in sight, and threatens to bid for cell phone radio spectrum. So Microsoft starts buying companies before Google does. And Craig McCaw returns with Clearwire, kind of. Is it real?
What is going on? Who predicted this? What happened to the techno-pundits and Wall Street mavens overflowing with mountains of buy and sell recommendations? Their crystal balls came up short. Everyone believed at Divestiture that AT&T with it's Long Distance jewel and massive network and technical resources would continue to dominate. MCI and Sprint were weak also-rans with no hope of catching up. And the Regional Bells were playing in the ho-hum horribly unexciting "we can ignore them” so-what regulated arena. Actually Wall Street's making more money than ever and doesn't much care who gets left holding the bag. Remember Lucent?
What does all of this portend? What are companies striving for? And customers?
In reality, with the exception of the self-serving investment community hype and lunacy, everything that has happened and will continue to happen can be explained with these basic driving concepts:
These forces are now playing out mainly in two arenas lovingly referred to as “WIRELESS” and "Cable".
We have finally reached the point where it makes little sense to talk about a "Telecommunications” Industry. The Cellular Telecommunications Industry Association harbingered the demise by changing their name to Cellular Telecommunications & Internet Association. There certainly is little sizzle to network and switching vendors that stock analysts used to follow so closely. And no new entrants will enter the core network equipment provider list. The industry has matured to relative irrelevance. Even Cisco is about to become passe.
Information Technology also dims in relevance. If you look closely at the leading edge companies and where they are headed, most notably Google, the industry is positioning for the next major wave. And preparing for their new “supporting role”.
What happened? Why? And what does the future hold?
It’s all about to be usurped into one overarching MEDIA INDUSTRY. AOL and Time Warner were on the forefront. But they were not dialed in to the future quite correctly. And they got lost when dial became replaced by cable and DSL. Get that. A cable company can't transition a subsidiary to their own cable for profit.
This will be examined at some depth over the next few weeks and months to explain:
what happened and why,
what the future holds, and
the implications for the economy and society.