The Coming Age of Personal Communcation Exchanges

November 4, 2003

in Accelerating Innovation, Skype Journal, Social Networks

What is your strategy for Skype? Where’s the news and quotes on it this week? I’ve blogged Skype fairly consistently since my first Skype post because disruptive innovation is where real value is created and new industries born. Because it remains an “early warning indicator” of a tech-tonic shift. Then organizationally the question is… “How do we plan?” “How do we minimize risk in this emerging environment?”, What powerful challenges must we communicate down through the organization? These are strategy questions. Current answers analytically based from Gartner to who knows where say you have years. Well it is simply not true. So how will you frame your questions to make your organization think faster?

The cost of my being right and you wrong —- is an unbelievable destruction of bottomline wealth. If Skype reaches million and millions the loss of revenue will be in the billions. Yet Skype is not the problem it is merely the indicator that all has changed. The input you need to address the challenge is more qualitative, more focused on behavior. In a world in which the perception is the “profit” is gone… and cost cutting only (look at the centralized VoIP providers!) retains users the seeds for new value added propositions must begin now. Now these aren’t just products. They may also be contracts, interconnect agreements that enable better products to be marketed. Strategies born of conditions to develop tomorrow. How well has Yahoo done with broadband?

So I remain amazed. The number that don’t get it and the emerging few that do. What is really the state of understanding this week? While we still have reporters in the WSJ thinking phones if you are operating in this market with that frame of reference you are going to be dead.

The Register
“In Faultline’s view Lee Gomes of the WSJ fails to understand how disruptive and discontinuous innovation works. The rules that have been observed through history are that you need to offer something half as good, for a tenth of the price.”

So there is a complete disconnect. The industry has failed to identify how to get consumers beyond thinking phones. Hell in the same time period they used postage stamp before telex before fax and then e-mail. They are going to think “phones” and not about how communication is changing. Is it because we put it to our ear rather than use our eyes? Ear Phone. Web Phone? I-Phone? When you look at it VoIP is a useless label for creating consumer products. Next generation communications would at least introduce the idea of something new. Concurrently talk of convergence fails to provide the stories one can grasp. Consumers can make this shift. Just see the mental shift to Home Entertainment. Concurrently all these hardware devices are being commoditized. What we need will be very cheap in a very short time!

It’s the End of the Phone As We Know It …
“But I don’t think the traditional wire-line phone folks will feel so good. That’s because when you combine Wi-Fi with cellular, you just obviated the need for any wired phones at all. ”

Yes please send out a few of those babies. It’s much closer to the Pocket Personal Communication Exchange. In fact the first generation PCE’s (give it a label maybe it will stick) will be desktop/laptop sized. What we are missing is the handsets to make stage one a reality. You can’t wire people to PC’s with headsets when they have been walking in the garden with their analog cordless phone. Compared to music we’ve been on LP’s, there are a number of CD’s around getting fairly pervasive, while ripping Mp-3’s is just about to begin. Wearable communications products look like nice to have and yet nothing I’ve seen even begins to suggests how they will harness social networks in new ways. Similarly “marketing” opportunities abound in this new connective world. See Managing the Maze of Mulit-Sided Markets (registration required)

“It’s the difference between making a phone call over the Internet, and voice as an internetworking application. Or to put it another way, the different between the Internet as a subset of telecommunications, and telecommunications as a subset of the Internet.”

There is an assumption that perfect quality is expected. Land lines are seldom down but try and answer the phone in my house when the power is out. My mobile companion “Verizon” is frequently useless. Some will want to pay for more centralized exchange services. Others will be quite happy to manage their own personal communication exchanges. So who has the advantage? Run some scenarios on the IM world. Bet at least one turns up where the regulations are closer to the wild wild west.

The Jeff Pulver Blog: Highway Skype Revisted
“The present signs are for the coming of a true “Consumer Communications Revolution” but it will be up to the people to decide what part of the next phase of this revolution they will be a part of.
And don’t forgot that in the case of any revolution, you should expect to see those effected fighting back with the tools they are most effective in using – in this case it will be and is telecom regulations.”

I’ve also been learning about ground reakers who have been in this space before and not made it. Elise Bauer is one. See her point of view at AlwaysOn.

The Hype of Skype :: AO

“Will Skype fulfill its promise as an end run around the phone companies? In my opinion, ultimately no, though it may do a good job of competing with AOL, Yahoo, and Microsoft’s IM clients. What would be a great product in this space is something that lets you program sophisticated phone capabilities for your phone through a simple web browser, your own soft PBX so to speak. However, I can tell you from experience that you can

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