Few will be upset that retrospectives on the very problematic year are best left to historians. There's nothing good to look back on, so let's move on instead. What will shape the telecom industry in the new year‾ Forget the traditional talk about what a new administration might or might not do and focus on the big three technology trends.
1. An emerging online ecosystem joins telecom and the Web into a single business model
This will be absolutely the hottest new trend in 2009. In December 2008, Alcatel-Lucent announced a company strategy based on creating the tools for this new ecosystem. Cisco CEO John Chambers had similar comments about binding the tools of the Web into a single, cohesive development framework.
In addition, articles about how Google was looking for a 'fast lane' from access providers to speed its content to users seemed to make it clear that the old face-off between the over-the-top players and the telecoms might be ending. We've had years of 'over-the-top' versus the carriers, and now we're heading for a future where the distinction will become very fuzzy indeed -- not through mergers and acquisitions but through cooperation.
For three or four years, telecoms and Web companies alike have been working to gain support from application developers to enrich their services. The iPhone and Android models were compelling because they generated a cottage industry that has driven the core product and service set to much greater utility, as well as greater adoption rates and revenue generation. The problem is that while everybody seems to want to support developers, everyone supports them differently.
No one has solved the question of how all these cooperative players manage to combine their efforts to create something stable, easily supported and capable of generating revenue for all through cooperative settlement. Standards have been marking time in this area, and now it looks as if equipment vendors are stepping in to create the framework for the new ecosystem. Why‾ Because capex is usually pegged to revenue, so if you can't help your carrier customers raise their top line, their spending will languish and so will vendor profits.
Service providers tried to solve this problem of cooperative ecosystem-building with standards, but they moved too slowly. They then started to pressure their equipment vendors to come up with a solution, and the Alcatel-Lucent and Cisco announcements are the result. There will be others; and by the end of 2009 it will be all about 'service mashups.'
2. A CDN/cloud computing model emerges for settlement for online services
This is why the new ecosystem is suddenly developing. For decades, the Internet has suffered from a basic problem of lack of settlement among the providers. Everyone pays for access to their ISP, but nobody pays for transit. Where there's no revenue, there's no investment.
On the other hand, content providers are happy to pay for content delivery network (CDN) caching, and Software as a Service (SaaS) providers are eager to find good cloud computing resources. The access carriers are putting money there, and these new resources link not to the Internet core but to the access networks.