Telcos Have Google Envy

A new report by Heavy Reading asserts that when it comes to delivering differentiating next-generation services, Internet companies like Google have the edge, while major carriers aren't sure what to do.  Surveyed firms--France Telecom, NTT, TelaSonera, and Verizon Communications--know what they don't know and realize they will have to partner with third-party application companies to deliver the advanced services consumers will ultimately want.

Telcos are looking at third-party applications and trying to find ways they can add value to them. Most of the carriers feel they bring value to the table with billing, security, and QoS; policy control is also an area which carriers are looking at, but it's very controversial and kicks up the net neutrality crowd.

The bottom line--traditional telephony--is a dying asset and if they want to keep growing revenues in the future they will have to partner up and open up their networks to third parties. Sprint [1] and Verizon Wireless [2] have already taken the first steps in opening up their network and movement is expected on the wireline side as well. When it comes to advanced services, carriers see Google as their biggest threat, but Google doesn't make money as a service provider. Instead, Google relies almost exclusively on online advertising for revenues.

For more:
- Light Reading's GoogleEnvy writeup [3]
- Reinventing the Telcos [4] Report

Related articles:
Verizon Wireless [5] embraces open access
Sprint [6] outlines Xohm WiMAX plans
Sprint: [7] 'We're creating a platform for innovation'