Welcome to the age of telecoms steam

Written by on January 5, 2016 in Opinion with 1 Comment

Steam LocomotiveThis time last year I wrote that it was trendy for analysts and journalists to look into their crystal balls and tell you what to expect in the coming year. For me, it made more sense to look back on the year past and see what had failed or otherwise made no sense – in the faint hope that we could jettison the silly stuff and remedy the situation in the coming year.

My opinion in this regard has changed little and sadly, very little has changed in the telecoms’ world either. It is like an old steam engine, it just keeps going along on it’s merry way needing a little fuel and water to keep going. There are no high-speed trains here, they seem to be the bastion of the digital players of the internet world.

And just like the steam buffs that believed that the era of steam would never end and that those reckless diesel and electric train buffs would come off the tracks the telco world is, only now, realizing that times are changing. But the change is still agonizingly slow coming, hampered by the belief that no customers should be disrupted by change and legacy systems should be maintained just in case something goes wrong.

The high speed players just go for it and if it doesn’t work they turn it off and try something new, and their customers not only accept it, they even expect it. This won’t change unless the new boys buy out the old boys and this might happen one day – just not in the foreseeable future.

And the reason is quite simple. Why would they want to be fettered by the same regulations telcos suffer from. Those regulations came from the steam age and are still there. The response of regulators (then original fat controllers), only to maintain their positions of grandeur, is to introduce even more regulation – but their time may soon be up also.

I’d hate to mention ‘net neutrality’ yet again but in this very same column this time last year I spent many paragraphs lambasting the FCC in the USA for playing politics with something that has worked fine for a long time without its meddling.

Under the guise of providing equal internet access to all it tried to impose a set of rules to guarantee that freedom. Somehow, rules and freedom don’t go well in the same sentence and the USA courts agreed. In early December they tore strips off the net neutrality case, and the dust won’t settle for some time yet.

Sadly, the rest of the ‘free’ world (mainly the short-sighted and toothless European Commission) followed suit and started imposing their own rules for net freedom, based on their American cousins. Talk about the blind leading the blind!

But what happens if the FCC is forced to rescind its rules and the most powerful internet state in the world falls back to the status quo – a regulation free internet, then what happens to the others. Apart from ending up with egg on their faces it may, once and for all, highlight that the telecoms industry has grown up and doesn’t need to be policed constantly.

The beauty of the free market approach, as I espoused last year, is that the customers decide what they like and don’t like and they vote with their feet and wallets. If any network operator or CSP tries to be clever the word will spread like wildfire over the social channels and their customers will fly to the next available roost.

Regulation may have been needed during deregulation – an oxymoron if there ever was one, to protect new startups from the evil PTTs – but now that there are multiple players in almost every world market so why not let them get on with some good scrapping.

The courts can decide if anybody is being naughty, much like they do now. The regulators can be pensioned off and every country can save millions that can better be spent on farm subsidies, fireworks displays and flood controls, seemingly brought on by climate change.

And if they still don’t want to play ball the governments should roll out their own national broadband networks and make everybody use those, just like they do with the railways. That way customers will have the choice of steam or high-speed electric trains and we will see who wins then.

First published at TelecomAsia.

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About the Author

About the Author: Tony is a freelance writer, regular speaker, MC and chairman for the telecoms and digital services industries worldwide. He has founded and managed software and services companies, acts a market strategist and is now Editor of DisruptiveViews. In June 2011, Tony was recognized as one of the 25 most influential people in telecom software worldwide. .


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  1. Lorne Mitchell says:

    Your analogy with steam is interesting, Tony. Let’s take it a bit further. Most trains in Europe and the US run on the “standard” gauge of 4ft 8.5 inches. Where did the four-foot, eight-and-a-half-inch standard originate? It was from a Englishman named George Stephenson. Carts on rails had been used in mines in England for years, but the width of the rails varied from mine to mine since they didn’t share tracks. Stephenson was the one who started experimenting with putting a steam engine on the carts so there would be propulsion to pull them along. He had worked with several mines with differing gauges and simply chose to make the rails for his project 4-foot, eight inches wide. He later decided that adding another six inches made things easier. He was later consulted for constructing some rails along a roadway and by the time broader plans for railroads in Great Britain were proposed, there were already 1200 miles of his rails so the “Stephenson gauge” became the standard.

    Interestingly, the 4-foot, eight-and-a-half inch width has not always been the standard in the U.S. According to the Encyclopedia of American Business History and Biography, at the beginning of the Civil War, there were more than 20 different gauges ranging from 3 to 6 feet, although the 4-foot, eight-and-a-half inch was the most widely used. During the war, any supplies transported by rail had to be transferred by hand whenever a car on one gauge encountered track of another gauge and more than 4,000 miles of new track was laid during the war to standardize the process. Later, Congress decreed that the 4-foot, eight-and-a-half inch standard would be used for transcontinental railway.

    There are those who believe that the 4-foot, eight-and-a-half inch width went back to the width of a horses arse from Roman times is most likely not true either. (see: https://www.truthorfiction.com/railwidth/).

    So what has all this got to do with steam? Well, the steam engines that ran on the old railways have the same track width as the modern high-speed trains. It is a standard – like the standards that go to make up the internet. We still have old steam trains running on the same width tracks as modern electric high-speed trains here in the UK. That doesn’t make steam more (or less) useful.

    The critical thing that most regulators miss is that the bottlenecks are in the exchange points that connect the various fibres of the internet together. It does not matter whether you run steam trains (email?) or high speed trains (HD Video?) – the gauge (Internet Protocol) is the same.

    Internet exchange points tend to be owned by private companies in the US with their own vested interests. However, in Europe (Amsterdam and London), the model has been very different. The ownership is a collective, or a cooperative.

    The challenge is that internet exchanges are concentrated in a few large cities. In the smaller cities and towns, the bottlenecks have become the telephone exchanges (by default). That’s all very well for the incumbent telephony providers – but is not fit-for-purpose for the Intenet age.

    With a few colleagues, we have developed a new model in the UK at a regional and local level that takes the best of the European internet exchange model and have made it local. It is called a “local digital exchange” or Digital Exchange for short. (I believe it could actually scale-down to a village – but we have not tried that yet. Some call this variation a digital village pump).

    So long as we continue to regulate the telecoms industry with the same thinking as used for telephone lines, I am sure you are correct, we will stay in the steam age. However, I don’t think governments should roll out their own broadband networks (your final point). This has not worked in Australia. Singapore is owned by a family anyway and is a special case.

    What government regulators need to encourage, promote (and perhaps part-own so they can prime them with their own local authority needs) are the new local digital exchanges. The bandwidth will then naturally converge onto these points – much like the carriers naturally POP carrier-neutral data centres. You can read more on this thkinking at http://www.localdigitalexchange.com. With UK Government money, we have developed the first one of these in Brighton in the UK in 2015 and are looking to build more instances in 2106.

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