I thought might be an interesting exercise to state my views and predictions for what I see as coming in the next 2-3 years. Now the next obvious question is how we can all position ourselves to best take advantage of these possible trends and profit.

I see three dynamic influences having a dramatic effect on our near future and all of them are interdependent.

1.) Internet throughput demands rising exponentially.
2.) Dependence on connectivity becoming crucial.
3.) ILECs and Cable experience serious changes.

1.) I do not believe a 1.5-2Mbps Internet connection to be adequate for the average ISP/WISP in 2-3 years. In fact, if bandwidth usage doesn’t significantly increase, the end result will be an economic loss to some of the more advanced technology enriched countries

I fully expect to see a huge increase in the amount of bandwidth the average users demands as VoIP, VoD, IPTV and video conferencing now become mainstay services. I am predicting that we will see exponential growth in demand from today where 100 users are being satisfied with a T1 connection to requiring 25-45Mbps of throughput for the same 100 customers within three years.

2.) I recently read a study detailing the effect people who are used to high speed connection experience when they are detached from their connection. During this somewhat informal study measurable amounts of anxiety and in some cases elevated levels of depression were observed. No, I do not believe we are becoming the Borg but as the net gets “stickier” (read new, improved and more addicting) I believe that we as a society will become substantially more dependent.

This makes the 100% guaranteed uptime and adequate bandwidth targets we need to shoot for in the long term.

3.) The ILECs and Cable Companies are already having financial difficulty. They have carefully distanced themselves from Licensed Exempt wireless. As they continue to do this, the opportunity to build infrastructure of our own and capture a loyal portion of the market presents itself.

I do not believe the current plan of the ILECs and the Cable Companies can win based on its current timetable and budget. And while I understand that innovation in their world is happening and lowering their costs the use of poles and wires is a very poor idea, prone to mechanical breakdown, accidents and huge maintenance expenses.

The constant expenditure for maintaining their networks coupled with the capital outlay to build new infrastructure needs to be based on the assumption that revenues will increase or at the very least stay flat. I suspect they are also counting on the government to ensure them of increases of their rates unless they can get the controls taken off of them where they could then charge whatever the market would pay.

On the revenue side of the picture, the ILECs, cell providers and the cable companies make money from the following services; Telephone, (including cell phone) Television, PPV, Advanced Data Services and Internet. Some disruptive technologies are creating a crossing over into telephone for the cable companies (VoIP) with VoD, PPV and IPTV becoming a possibility for the ILECs. Even the cell phone business is under attack by the rolling out of WiFi hot zones that are able to carry VoIP and the introduction of cell phones that will hunt for a WiFi network to connect to.
For years the ILECs have had complete protection in providing landline telephone and Advanced Data Services. The cell phone providers also enjoyed near complete protection of their revenues based on their network deployments and protected frequencies.

Those days are gone. ILECS are losing landline telephone at staggering rates. While DSL is still the most popular choice for broadband cable is quickly overtaking DSL with wireless just beginning to enter into the picture seriously. Advanced Data Services are also in decline as companies that used to have to get a T1 for connectivity now enjoy other methods. Even the cell phone companies are now under threat as citywide WiFi hotzones now offer a connection to a VoIP account through your brand new WiFi enabled cell phone. This one innovation threatens to gut the most profitable markets right out of the cell phone provider’s bottom line.

At the risk of stating the obvious, if the ILECs, cell phone providers and the cable companies see a sizable shrinkage in their revenues the money they are counting on to finance the next phase of their build outs isn’t going to materialize.

On the revenue side of the picture, the ILECs, cell providers and the cable companies make money from the following services; Telephone, (including cell phone) Television, PPV, Advanced Data Services and Internet. Some disruptive technologies are creating a crossing over into telephone for the cable companies (VoIP) with VoD, PPV and IPTV becoming a possibility for the ILECs.

For years the ILECs have had complete protection in providing landline telephone and Advanced Data Services. The cell phone providers also enjoyed near complete protection of their revenues based on their network deployments and protected frequencies.

Those days are gone. ILECS are losing landline telephone at staggering rates. While DSL is still the most popular choice for broadband cable is quickly overtaking DSL with wireless just beginning to enter into the picture seriously. Advanced Data Services are also in decline as companies that utilized a T1 for connectivity now enjoy other similar. Even the cell phone companies are now under threat as citywide WiFi hotzones now offer a connection to a VoIP account through your brand new WiFi enabled cell phone. This one innovation threatens to pull the most profitable markets right out of the cell phone provider’s bottom line.

At the risk of stating the obvious, if the ILECs, cell phone providers and the cable companies see a sizable shrinkage in their revenues the money they are counting on to finance the next phase of their build outs isn’t going to materialize.

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