Telecom trends worth watching.
Part of strategy's job is to size up trends in one area that may have consequences for another. The phone industry is still closely connected to the Internet. Three points of contact make me say, "Hmm": the National Do Not Call list, the rise of VOIP, and the arrival of "edge" players at the rim of the grid.
Don't Call Me...
The first contact point is glaringly obvious and the most recent. Signing up, by Web and phone, for the Federal Trade Commission's (FTC's) National Do Not Call Registry has only been possible for a month. As ClickZ discussed only last week, registering via the Web versus the phone ran at a 9:1 ratio. Analysis also suggests large numbers of the online population acted promptly on this opportunity to protect their privacy. A preference for the Web as a channel and the expression of a value system are verifiable lessons.
Meanwhile, the nation's call center industry has crumpled. Marketers are moving dollars away from outbound telemarketing to other channels. Who benefits? Data-based and response-enabled marketing via traditional mail, email, and direct-response TV will likely do well. Digital can get its fair share, but the situation promises a bigger bang (certainly for marketers) if it's framed and figured out as multichannel optimization.
Customers obviously use multiple channels to communicate with companies with which they do business: in-store communications, mail, telephone, fax, Web, email, and now mobile phones. Better customers use more channels, according to the statistics. Present reality at most companies is cacophony. The Do Not Call Registry may spark a major tidying up.
Businesses have 18 months to continue with current customer-contact practices. Then, do-not-call provisions apply. Some will use this window to do a somewhat bigger job: discover which customer segments want to conduct what commercial tasks in which channel and how often. Companies can then align communications to those preferences and thereby reduce costs, accelerate revenue capture, and increase customer satisfaction. A change in one channel is an opportunity to align them all? Hmm.
The Networked Household
The second connection between the phone industry and the Net is VOIP. This, too, will get a big lift from the FTC when rules on portability go into effect in November, a month after the Do Not Call list is turned on. Portability means customers can keep their existing mobile phone numbers when they change carriers. Removing this barrier is expected to spark a rush to VOIP.
Incumbent voice carriers are threatened because VOIP services are positioned to offer a better deal. VOIP makes less use of the high-priced legacy telephone grid. It's not subject to many government taxes, fees, and surcharges imposed on the incumbents. And it's more flexible with the taxes and fees that are imposed.
Here, again, a change in the telephony space creates an opportunity elsewhere: This time, in the household itself. VOIP fits easily into any home where a router splits a broadband connection. In other words, substantial market uptake of the new voice delivery system would accelerate arrival of the long-envisioned networked household. This terrain has always promised many new possibilities for marketers who can shape and fill new modes of communication. Is VOIP the leading edge of the eagerly awaited networked household? Hmm.
The third telecom trend that gets me wondering is the emerging distinction between edge providers of services such as voice, data, and video and network providers of transmission on which those services run. Today, service and network are linked; for example, phone calls are on phone networks. The more the network and transmission tasks move to broadband in the future, the easier it will be for edge providers to enter and succeed.
An edge does appear to be forming. Microsoft is building VOIP into its next PC operating system; Apple recently introduced iChat, a voice version of instant messaging; and Cisco offers Wi-Fi phones. More interesting is the arrival of main-street content providers, now off traditional transmission systems' hook. Both ABCNEWS.com and MLB.com offer video-over-broadband services directly to the end user on a subscription basis.
How much room is on that edge? What will succeed there? What will it take to succeed? Hmm.
These bells are tolling. Do they toll for you?
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