VoIP Gets A Big Backer And Another Lawsuit

Ungrounded Lightning writes "Time Warner Cable has announced plans to roll out a VoIP telephone service. I see two implications. First: ISPs providing VoIP phone service have a competitive advantage over third-party VoIP/PSTN providers (such as Vonage), who must ride on top of a separate broadband subscription for the packet transport. This could lead to consolidation of this industry segment in the hands of ISPs. Second: Cable ISPs have an advantage over Telco DSL operations - where a VoIP offering would cannibalize their own POTS and short-range long-distance revenue. This implies rollout on cable providers first, followed by harder times for telcos, long-distance companies, and third parties." chipperdog writes "In this article it is mentioned that the small rural phone companies in North Dakota are filing a complaint against a local VoIP provider, CallSmart. Interesting to see how this one works out, given what happened in Minnesota a few months ago."

Comments

competition?

[gid13]

Well, it seems to me that this at the very least provides some valuable competition to the phone monopolies. Unfortunately, capitalism being what it is, it seems fairly likely to me that either VoIP or phone (probably VoIP) will eventually destroy the other, and unless we get more competition in the ISP market we'll just end up with another monopoly.

I could be wrong, but I think that one of capitalism's biggest problems is industries that require a large infrastructure. I know that socialist approaches to most things tend to be less efficient (due to the lack of competition), but in a case like this I think it's better, since to get REAL competition we need multiple infrastructures reaching every single house, the cost of which of course would still get passed on to the consumer.

Nobody wins yet...

[cmowire]

I don't think the analysis is correct. Right now, nobody has a true upper hand.

• Cable ISPs have no experience running a teleco, but they have a marginal technical advantage over a non-ISP VoIP provider simply because of better network routing
• ILEC DSL ISPs (the phone company) can sell you a pure DSL connection without canabalizing their existing market simply because they will use VoIP instead of a splitter.
• CLEC DSL ISPs (Covad) benefit simply because they don't need the phone company do to the splitter anymore.
• Pure VoIP providers benefit because they have no fear of canabalization and they've already started. With the CLECs, they share the benefit of being folks who generally don't have people who have been mad at them since the 80s when the cable was always out of service and ma bell was busy screwing you over.

Re:WRONG

[line.at.infinity]

raisinets wrote:

I work for the AT&T telco division....

You were working for Apple 2 hours ago, for Honda 2 days ago. That's quite an amazing feat.

Re:Phone companies shouldn't feel threatened

[Wesley Felter]

I understand why phone companies see a threat in VoIP providers, but they shouldn't. Maybe they'll experiment some looses during the time the hype is high, but later on things should be roughly back to normal...

Things may get back to normal for the industry as a whole, but the telcos will not survive the transition to VoIP due to their massive amount of capital assets which are becoming increasingly worthless.

POTS won't die for a while...

[pdaoust007]

As exited as I am to see Internet services such as VoIP become mainstream, part of me still thinks that POTS will still be here for a while.

A couple of things to consider:

- You need broadband and not everybody has it, can get or will ever want it
- Cable and DSL (especially cable according ot my own experience) are definitely not as stable as POTS. They are next to useless when power is out unless you AND you proveider have UPS
- Emergency services are still an issue with VoIP. I'm expecting the first headline about someone dying because 911 wasn't available on VoIP anytime now.
- There is still no end to end QoS on VoIP. Home gateways are still too dumb to prioritize VoIP trafficover your Pr0n traffic.

Re:RIAA sound familiar?

[Brian_Ellenberger]

Is it just me, or is the American business model to stick with a rigid plan, and when that plan becomes obsolete, whine, bitch and complain until the politicians you bought last election will come up with laws that protect your horribly backwards business model and crush any and all innovation in the country.

There are very valid points as to why VOIP have unfair advantages over POTS. IMHO, too many people are jumping on the VOIP bandwagon because it is "new" and because they are the "little guy" fighting against the big evil telephone co.

But there are serious questions that need answered. What about 911? What about the laws requiring certain reliability and uptime requirements? What about rural areas without highspeed internet? What about all the taxes that are added your phone company's bill and not on the VOIP bill? I'm sure there are other questions as well.

Don't be one of those dorky protesters who root for the underdog until 10 years later when the VOIP guys are the "big guys" and you start compaining because basic phone and 911 is no longer available in the middle of Mississippi.

Brian

Re:It's all economics

[bob_calder]

If the infrastructure is good, then you can do it. I had a five line office and would NEVER subject my customers to even good VOIP quality. To me a high committment to customers means they should feel that they are sitting next to you. So it would have to be rally rally superb. Like up around 41mhz. Well, maybe not that good, but you get the picture.

The only choice for consumers

[appleLaserWriter]

In the business marketplace, VOIP makes sense for just about everyone. Any serious business is likely to be using a mix of frame for Voice and Fiber for data at the moment, VOIP allows this to all be consolidated into fiber pipes. This works well for the vendor because fiber is cheap to install and provision compread with DS1/DS3.

At the consumer end of the spectrum, copper works fine for voice calls, and is required for DSL. So there is no clear advantage for VOIP over DSL. But with cable, the TV line that has already been expanded to carry data can now carry voice. Big win for cable network owners.

I don't really care though, I've been a cell user for years. Would be nice if Nokia could work on the stability of the 3650 though :)

Re:So? Cable is unreliable

[Sivaram_Velauthapill]

I haven't tried VOIP or anything like that but POTS is more reliable than cable in my area. My "low-speed cable" goes down once in a while. Maybe it might be my area but I have certainly noticed it. Having said that, I have no idea how DSL is. I have not had DSL for long periods of time.

Also, one other thing... I use the internet a lot. I am pretty much on it many hours (especially since I'm unemployed :( ). Telephone on the other hand is only used occasionally (a few calls once in a while). So maybe I am just noticing the cable problem more because I use it more. The ideal case would be to compare DSL to cable (but as I said, I haven't had DSL for long enough to make any worthwhile comment).

Sivaram Velauthapillai

The Big Win

[sysadmn]

A cable company competes on two fronts: entertainment and the higher-margin data services. The big win for TW is not that this allows them to compete more effectively with DSL providers; it's that you can't (yet? ever?) do this over a Satellite connection. That allows them maintain price on the entertainment offerings and keeps customers loyal.