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McNealy Says Telcos Falling Behind in Net Race

CmdrTaco posted more than 6 years ago | from the also-low-on-gas dept.

Sun Microsystems 168

BobB-nw writes "Telecommunication companies need to go beyond just providing bandwidth and look into acquiring Internet destination sites that are heavily trafficked, says Sun Microsystems Chairman Scott McNealy. "I have explained to every telco that either you become a destination site, or the destination site will become a telco," McNealy said at a news conference at Sun Microsystems' Worldwide Education and Research Conference in San Francisco on Wednesday."

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168 comments

No way! (5, Insightful)

Jurily (900488) | more than 6 years ago | (#22587686)

First they need to actually provide bandwidth, not just throttle their heaviest users back.

Re:No way! (2, Insightful)

MoonFog (586818) | more than 6 years ago | (#22587708)

They throttle their heaviest PRIVATE users, which mean nothing to them compared to getting the corporate sector as customers.

Oh for the love of.. (5, Insightful)

Anonymous Coward | more than 6 years ago | (#22587702)

"I think the telcos have to make sure they don't get marginalized to being just bit providers and bandwidth providers," he said. On the other hand, carriers may be able to head off Internet sites by limiting the bandwidth available to them, so destination sites may need to affiliate with the carriers, he added.
Right. Can we all chip in on a bus rental, so we can all go over and slap this jerk?

Re:Oh for the love of.. (2, Insightful)

sm62704 (957197) | more than 6 years ago | (#22587890)

Amen to that.

I have explained to every telco that either you become a destination site, or the destination site will become a telco

I didn;t actually RTFA but I'm going to have to, just to see how in the hell a web site will become an ISP.

I think the telcos have to make sure they don't get marginalized to being just bit providers and bandwidth providers

That's exactly what an ISP is supposed to be!

WTF is wrong with that guy, besides being a lying asshat who will say anything to sell his company's crap?

Re:Oh for the love of.. (4, Insightful)

AmaDaden (794446) | more than 6 years ago | (#22588074)

I have explained to every telco that either you become a destination site, or the destination site will become a telco
Now from the artical.

Internet destination sites are already gaining on telecommunication companies, McNealy said, giving as examples eBay integrating Skype's VoIP technology and Google trying to buy wireless spectrum and help build cables across the Pacific Ocean. Microsoft's attempted acquisition of Yahoo would create another behemoth that could compete with carriers, such as by combining Microsoft's technology with Yahoo's existing VoIP and messaging services.
I think that he is referring to long term and big sites. Honestly it's not too unreasonable. If Comcast is fucking me up the ass and I can get my internet from Google why wouldn't I?

Re:Oh for the love of.. (4, Insightful)

hachete (473378) | more than 6 years ago | (#22588384)

From Google's POV, owning the pipes make perfect sense. Politics - they don't get screwed if net neutrality goes away. It's an end-run around all those eyeing their profit enviously. You own the pipes, you get to see what goes through them. I'd be dieing for data like that.

The only way to make a profit will be to own the pipes.

Historical parallels (5, Insightful)

Kadin2048 (468275) | more than 6 years ago | (#22588882)

From Google's POV, owning the pipes make perfect sense. Politics - they don't get screwed if net neutrality goes away. It's an end-run around all those eyeing their profit enviously. You own the pipes, you get to see what goes through them. I'd be dieing for data like that.
This is called a vertical monopoly. It's really no different than railroads in the 19th century owning a portion of a coal mine in order to ensure they had adequate fuel and weren't entirely dependent on an outside supplier. For reasons that I'm not sure of, but I think basically boil down to flexibility, vertical monopolies have fallen out of favor in most sectors (e.g. transportation) in recent years, in favor of security-through-diversity rather than security-through-ownership. For example, lately many businesses that ran their own delivery services (example I'm aware of, a large regional bread bakery) are outsourcing them in order to focus on their 'core competency' (baking bread) while leaving the delivery to a company that specializes in that.

The difference is, I think, that security through diversification and outsourcing requires a fairly mature business environment with many players to choose from. If you're the bakery who's considering eliminating your delivery department and going with an outside vendor for that purpose, you'd want to make sure there were many choices of delivery services, so that you're not tied too closely to one. If lots of choices and diversity don't exist, it might make sense to keep it in-house. Since Internet services are a relatively immature business environment, and a large content-provider like Google has few backbone providers to choose from, it makes sense that they're looking to secure their position by bringing things in-house.

What's ironic is that the one thing that the telcos absolutely oppose -- network neutrality enforced by legislation -- would probably remove much of Google's incentive to build out backbone capacity. If the telcos were forced to provide nondiscriminatory service, suddenly there's no risk for Google of being extorted. With the disappearance of that risk also goes the impetus to be their own backbone provider. (I think there are historical parallels in the early 20th century with the passage of the Interstate Commerce Act and its accompanying regulation of goods transport, although the waters are muddied by the power that the transportation and industry cartels held in the ICC and in government.)

McNealy: Just Be Evil (4, Interesting)

Mr. Underbridge (666784) | more than 6 years ago | (#22589184)

I think that he is referring to long term and big sites. Honestly it's not too unreasonable. If Comcast is fucking me up the ass and I can get my internet from Google why wouldn't I?

The problem with that thinking is that his proposed *solution* is what's causing the problem in the first place, pretty much exactly as you lay it out. If the carriers stop screwing people, Google wouldn't have anything better to offer as a carrier. The message should be "if you don't stop being a bunch of dicks, someone will step in and kill you." McNealy's message, on the other hand, is basically "Since people want to get away from you because you're a bunch of dicks, you could become even bigger dicks, get a monopoly on all the media, and give people no recource but to do business with you."

Which seems like better business - make people want to use your service, or try to get a monopoly so people have to use your service? Problem with the second choice is that 1) only one company can "win", and 2) people don't want canned content anymore, so you can't win at that anyway.

Re:Oh for the love of.. (1, Insightful)

Anonymous Coward | more than 6 years ago | (#22589334)

"I have explained to every telco that either you become a destination site, or the destination site will become a telco,"

To wax philosophic, the road is not a destination.

More bluntly, sounds like someone does not know his ass from a portal.

Re:Oh for the love of.. (2, Interesting)

squiggleslash (241428) | more than 6 years ago | (#22588130)

Perhaps he's referring to Google, which is on one level nothing more than a search engine and set of related Internet services, but whose problems with connectivity have lead it to increasingly take control over how its packets are delivered. It's buying dark fiber, it's bidding on spectrum, it's experimenting with Wifi networks.

Re:Oh for the love of.. (1)

mikael (484) | more than 6 years ago | (#22589152)

I didn;t actually RTFA but I'm going to have to, just to see how in the hell a web site will become an ISP.

Search engine portals - Their web spiders spend their lifetime crawling the web downloading and analyzing web pages. Buying high-speed internet access for this level of usage is usually charged according to how much data is transferred. It makes sense for such multinational companies to set up their own network and have a flat-rate maintainence overhead.

If any other web site has high data transfer rates (movies, videos, audio) then they too should be looking to see if it is cheaper in the long run to do the same. Many small commercial web-sites went out of business due to the costs they encountered from people downloading videos.

ISP's have a conflict of interest - their business customers mainly want to send E-mail, and download/provide webpages. Home users will want to download music, videos and movies as well as E-mail and webpages. There is no real incentive for them to upgrade just for home users.

By making the suggestion that major websites could invest in their own network infrastructure and not go through the incumbent telcos, this is one way of getting the telco's to start shuffling forward instead of treating the existing market of customers as a cash cow.

Re:Oh for the love of.. (2, Insightful)

sowth (748135) | more than 6 years ago | (#22587960)

Yes, this is stupid. Companies have their own internal telephone system, and some of the larger ones have their own connection between sites, but the telcos are still around.

What kind of crack is this guy smoking? Crack: the super ultimate kan ban SCO edition. Become a member of AOL: get yours now!

Re:Oh for the love of.. (2, Insightful)

Albanach (527650) | more than 6 years ago | (#22588934)

I don't think he's talking about POTS - he's talking about Google Talk, AIM, Yahoo Messenger, Skype etc.

He's telling the telcos that if they don't adapt, they aren't going to be carrying calls. Folk will buy bandwidth and use one of the above as their telco.

I know Embarq has received not a cent more than their minimum for DSL + a phone line from me in years, yet I make hours of calls each day, most of which are international. Every call is by VoIP and is routed on a lowest cost basis.

Unless telcos adapt, it's hard not to see that becoming the norm over the next decade.

Re:Oh for the love of.. (2, Funny)

UbuntuDupe (970646) | more than 6 years ago | (#22588692)

Right. Can we all chip in on a bus rental, so we can all go over and slap this jerk?
Probably not going to work out. I just talked to the bus company, and the rep told me that vehicles carrying geek activists must stay on the shoulder when driving (as per the road provider's rules), effectively limiting our average speed to 5 mph. So, it would take a few days for us to get to him.

HOWEVER, I have some good news: if we also pitch in to pay for an affiliate deal with the road company, we may be able use the regular lanes! Thoughts?

I'm guessing he has a server supplier in mind? (4, Insightful)

IainMH (176964) | more than 6 years ago | (#22587732)

Do you think he'd be willing to let telcos with their huge amounts of cash buy some hardware from him?

How kind for pointing this out.

Re:I'm guessing he has a server supplier in mind? (4, Insightful)

morgan_greywolf (835522) | more than 6 years ago | (#22588078)

Server and, more importantly, the software and services needed to get a destination site up and running -- Sun has the tools and Web/J2EE developers available for hire necessary to get a project like this up and running.

AOL (4, Insightful)

Anonymous Coward | more than 6 years ago | (#22587734)

Wait, wasn't this AOL back in the day?

Re:AOL (1)

JCSoRocks (1142053) | more than 6 years ago | (#22588916)

Oh please, anything but AOL. They were a designer's worst nightmare back then. Crazy non-standard browser that compressed the crap out of all of your finely tuned images until they looked like garbage. Your smooth gradient looks like a ribbon of crap on AOhelL. I always prayed that they would eventually go away... they never did... but at least people started using IE and Netscape/FireFox instead of the stupid AOL browser.

he is quite right (5, Insightful)

downix (84795) | more than 6 years ago | (#22587746)

Companies such as Yahoo, Google and others are already moving into the pipeline, further making telcos more and more irrelevent to the core business of the internet. I easily imagine the telco's, cable co's, even RIAA/MPAA becoming fringe players in the future, as information truely takes on a new dimention. It is evolve or die time.

Re:he is quite right (5, Funny)

snl2587 (1177409) | more than 6 years ago | (#22587794)

I, then, look forward to getting internet access from The Pirate Bay.

Re:he is quite right (3, Funny)

LiquidCoooled (634315) | more than 6 years ago | (#22587892)

I can quite easily see a fleet of ships around each country connected with a super speed wireless [slashdot.org] link and plenty of 802.xx pringles cans pointing inland.
incidentally, the linked article talks about sending 16.4 tpbs(pirate bays per second) so its gotta be good.

Re:he is quite right (1)

Tx (96709) | more than 6 years ago | (#22587912)

I, then, look forward to getting internet access from The Pirate Bay.

The already provide an anonymous VPN service [relakks.com], so it seems like a perfectly reasonable next step.

Why not? (1)

dazedNconfuzed (154242) | more than 6 years ago | (#22587934)

Considering their, ahem, lack of certain constraints, why not?
Wi-Fi coverage is so broad and overlapping that suitable reprogramming of certain models of routers could easily implement an ad-hoc wide-area uncontrolled network grid serving their major markets - rapidly creating a vast "backbone" mesh almost completely independent of major telcos.

Re:Why not? (0)

Anonymous Coward | more than 6 years ago | (#22589240)

Three problems with that:

1) Wireless mesh is more difficult than you might think to build and operate.

2) Performance (particularly latency) tends to be abysmal

3) You have to connect to the internet somewhere - that's the telcos. And those point of interconnect will be very busy if they're shared by all members of a grid.

Only because telcos aren't doing their job (5, Insightful)

dazedNconfuzed (154242) | more than 6 years ago | (#22587880)

Yahoo, Google, etc. are going into the telco business because the telcos are not doing their job. Instead of facilitating customers' needs and making usage easy, pleasant and efficient, they are trying to squeeze every penny out of customer pockets with screwy billing plans, bandwidth & destination throttling, etc. - practices which hinder the services which customers want and which Google, Yahoo et al want to provide.

As long touted, the Internet is designed to work around breakdowns and bottlenecks. Current telcos ARE breaking links and implementing bottlenecks ... so the businesses that suffer are taking advantage of the Internet's core purpose: distribute data efficiently around problems.

Funny thing is, if the telcos would just focus on getting packets from point X to Y quickly and cheaply, and pass that speed and savings on to the customer, they would make more money and not have to consider going into businesses they're not suited to.

Re:Only because telcos aren't doing their job (1)

MrNemesis (587188) | more than 6 years ago | (#22588214)

Funny thing is, if the telcos would just focus on getting packets from point X to Y quickly and cheaply, and pass that speed and savings on to the customer, they would make more money and not have to consider going into businesses they're not suited to.

They might well make more money. But would they have as much power? I'd like to think that the ability to control a large section of a universal communication network is somewhat similar to the Catholic church buying out Gutenburg from the day he was (literally) hacking away at his first printing press in his parents' basement.

Re:Only because telcos aren't doing their job (1)

Bombula (670389) | more than 6 years ago | (#22588526)

Yahoo, Google, etc. are going into the telco business because the telcos are not doing their job.

Telecommunications, along with music, are probably the best current examples of industries whose decades-old business models are being mangled by digital technology. Just as it no longer matters by what means you get the 0s and 1s that comprise your music, it no longer matters by what means you get the 0s and 1s that comprise your telecommunications - that's not just phone, but internet, TV, messaging, etc.

The older telcos are scrambling because owning twisted copper pair lines is no longer enough to ensure a profitable revenue stream - there are several other ways into people's homes now: co-axial, satellite, wireless, powerlines, and fiber.

What consumers are increasingly going to want is a comprehensive telecom service: phone+TV+internet. Some providers are already in this market, like Comcast. They will NOT need a webportal in order to be successful. But this does not mean that Google or Yahoo could NOT be successful if they decided to provide an alternative telecom service, say with the floating wi-fi blimps I keep reading about. The best we can hope for is that Google will enter the market, provide some genuine competition for Comcast et al and drive prices down and quality up.

Customers want bandwidth from telcos, not content (1)

dazedNconfuzed (154242) | more than 6 years ago | (#22588790)

What consumers are increasingly going to want is a comprehensive telecom service: phone+TV+internet.

No, what they want is a telco that's going to deliver what they want, NOW. What they want will largely come from the "long tail" that a single provider won't.

Phone is just getting data from one specialized (audio i/o) device to another; if somebody can just map phone numbers to IP addresses and get an audio data stream from one to another, we don't need a "phone service".

TV? 300 channels and only 3 I want to watch? Get outta my way and let me get my video from iTunes, YouTube, and a thousand other niche providers. Comcast doesn't serve the content I want - but someone does, so just deliver that video data stream.

Internet? it's just moving data packets from A to B. Do that fast, efficient, and cheap, and I'll pay a bundle; throttle me and push lousy content & stupid "phone billing" in my face, and I'll find someone else who will just transfer my data fast, efficient & cheap.

Re:Customers want bandwidth from telcos, not conte (1)

Bombula (670389) | more than 6 years ago | (#22589122)

I think you are dazed and confused about my comment, as you repeated much of what I said and implied: all telecom is just 0s and 1s, and consumers increasingly want a single service that bundles everything into a single digital communication package. One bill, plenty of bandwidth, and all standard service forms - phone, internet, tv, etc is covered. Whether you actually use a telephone handset or not to make your calls is up to you. The point is that it will be a single company providing you with connectivity.

Re:Only because telcos aren't doing their job (2, Interesting)

Skrynesaver (994435) | more than 6 years ago | (#22588816)

I mostly agree with you, however I don't agree that they won't need a portal, whether it's a web portal, or a set-top box portal as the choices of where to get your connectivity increases the option of switching does also and some service level differentiation is going to be needed to avoid being drop-in replaceable.

At the moment, as I understand it Comcast has a near monopoly in the US and so doesn't yet face that kind of competition, but it will happen

Re:Only because telcos aren't doing their job (1)

rucs_hack (784150) | more than 6 years ago | (#22589004)

Comcast have a monopoly under the current system, but systems evolve, and it's Google, not Comcast, who are making the right moves to be the big player when the net changes.

Whether we like it or not, there will need to be serious changes to the internet that mean anonymity is a thing of the past. At least as its thought of now. I don't mean all your private information being broadcast (or sold), I mean that it won't be possible to hide where you're coming from, or who you are, even if that 'who' is just a listing in a directory of net users..
This *has* to be done, or the internet will collapse as a platform for commerce, because online fraud and crime are big problems that we can't just ignore. It wasn't designed for commerce in the first place, but that's what it's become. We need it to survive as a commerce platform too, because that's been a good thing for all of us.

It's likely (or so I believe) that the sort of free internet we want will most likely be in the form of virtual internets that exist within game worlds. Think Second Life, only not as centralised, and not as, well, gay.

Re:Only because telcos aren't doing their job (2, Insightful)

smooth wombat (796938) | more than 6 years ago | (#22589020)

Just as it no longer matters by what means you get the 0s and 1s that comprise your music, it no longer matters by what means you get the 0s and 1s that comprise your telecommunications

The older telcos are scrambling because owning twisted copper pair lines is no longer enough to ensure a profitable revenue stream - there are several other ways into people's homes now: co-axial, satellite, wireless, powerlines, and fiber.


Yes, it does matter. The examples you provided have varying speeds of 0s and 1s delivery. As a rule, it would be fiber, co-ax, wireless, satellite and powerlines. You say it doesn't matter but considering all the whining on here about how long it takes to steal (er, liberate/borrow/sample/whatever) a piece of software or song or how long ones lag times are for WoW or BF2, it most certainly does matter.

People want the fastest service at the lowest price. Period. While getting a network connection through satellite is feasible, most people don't want to pay what it costs AND still deal with the slow response times.

Which leads to. . .

What consumers are increasingly going to want is a comprehensive telecom service: phone+TV+internet.

No, consumers are not necessarily wanting to go this route but providers like Comcast and Verizon are forcing it on consumers because they, the providers, can make more money that way. If you look at what Comcast offers for their triple play, it costs, minimum, $100/month for all three services. Considering I'm paying $23/month to Verizon for a landline, I would be spending $7/month more just for the phone portion which includes long distance which I don't use (thus the $7 difference).

If I could get just the internet portion from Comcast, that should be $33/month. A very reasonable rate. But Comcast won't offer you just internet. You MUST buy all three.

Verizon isn't any better. Their triple-play is also $100/month but they use fiber rather than co-ax. I have been getting offers from Verizon for just net connection and according to their own web site [verizon.com], they offer in my area:

$43/month for 5/2, $53/month for 15/2 and for $65/month I can get 15/15. These prices do not include the cost of installation ($80), the activation charge ($20) and are based on a yearly contract. If I quit early I am charged $99 and those rates will go up after the term expires (see the fine print for details). To see what the rates will reset to, click the link 'Show More Plans' at the bottom of the list.

Unless someone like Google or AOL (AHHHHH!!!) can provide the same service at a cheaper price, the monopolies like Verzion/Comcast/TW have nothing to fear.

Re:Only because telcos aren't doing their job (1)

Bombula (670389) | more than 6 years ago | (#22589346)

Your post is highly confused: you are mistaking what companies are currently providing with what consumers want.

While there are differences in the bandwidth capacities of different lines, they are all grossly underutilized in the marketplace. Twisted copper pair lines can easily support 100MB/s when correctly implemented. So can powerlines. Japan just launched a satellite service that will provide 1GB/s. Local wi-fi can easily achieve 100MB/s as well.

As I said, consumers - including yourself as you outline in your post - increasingly want a single service provider to deliver high-speed, low-cost connectivity. This is not necessarily what the market is currently delivering, but that has no bearing on what people actually want.

You are confusing supply with demand.

Re:Only because telcos aren't doing their job (0)

Anonymous Coward | more than 6 years ago | (#22588840)

Unfortunately, the telcos have convinced themselves that being a big fat dumb pipe is antithetical to their continued existence. So doing this is not considered to be in their best interest.

Funny thing is, if the telcos would just focus on getting packets from point X to Y quickly and cheaply, and pass that speed and savings on to the customer, they would make more money and not have to consider going into businesses they're not suited to.

Re:he is quite right (3, Interesting)

u-235-sentinel (594077) | more than 6 years ago | (#22588368)

Companies such as Yahoo, Google and others are already moving into the pipeline, further making telcos more and more irrelevent to the core business of the internet. I easily imagine the telco's, cable co's, even RIAA/MPAA becoming fringe players in the future, as information truely takes on a new dimention. It is evolve or die time.

Part of the problem is also we don't have a great infrastructure in place to handle all the new services coming online. The bandwidth crunch is what companies are fighting against. Some companies (Concast) are either break applications or terminating their customers internet usage to solve the bandwidth problem. And saying .01% are being affected is silly. If that number is really low then why are there three of us in my neighborhood who were terminated? The odds of that are just not in line with their statement.

Anyway, I'm hoping we can get the same infrastructure that other countries are running to the home and business. They are building their future on fiber lines and we're still rolling out copper (Unless you are with Utopianet.org or Verizon).

Is this thing on? (0)

Anonymous Coward | more than 6 years ago | (#22587750)

In Soviet Russia, either you become a telco site, or the telco site will become a destination site that becomes a telco destination site.

err... what?

Still need those damned wires (5, Insightful)

elrous0 (869638) | more than 6 years ago | (#22587754)

or the destination site will become a telco
This is just not going to happen. Why? Because there is still a question of physical wiring involved. Unless and until some MAJOR advances are made in wireless technology (way beyond what the 700 Mhz auction [wikipedia.org] can provide), wired is always going to enjoy the advantage and there are only so many wires going into your house/apartment, with only one company controling each (normally). Most people (at least in the U.S.) basically have one or two choices for truly high-speed broadband, your phone company (DSL) and your cable company (cable modem)--AT&T and Time-Warner in my case.

For all of Google's and other "destination sites'" talk about buying all this wireless spectrum, the fact is that wireless will just never be able to match wired for speed or quality (a 20-year-old corded phone still sounds better than even the best cordless or cell phone). You just can't get around the fact that a wire (fiberoptic or copper) still has to be laid out there for the best results. And no "destination site" is going to be laying that line anytime soon.

Re:Still need those damned wires (1)

pipatron (966506) | more than 6 years ago | (#22587976)

You can change this, you know. Since the free market is apparently failing, you (the people, in the end: the government) can force the last-mile companies to split up, and force them to rent their last-mile connections to anyone for the same price. It's just a question of politics, as usual.

Re:Still need those damned wires (1)

plague3106 (71849) | more than 6 years ago | (#22588860)

If you're going to do that, why not just have the local government own the lines outright?

I'm really glad my city is rolling out its own fiber lines, because Verizon and Adelphia/Comcast have done nothing to provide better service.

Re:Still need those damned wires (1)

gnuman99 (746007) | more than 6 years ago | (#22589216)

No, you force the companies to sell the access to lines *for the same price* to everyone. Does that make sense??? Has nothing to do with the actual price or anything else. It requires that,

    1. Telcos charge the same for the last-mile connection to company X as they do to themselves. This means, they can't charge $40 for DSL access line rental and then offer DSL for $35 themselves. They need to offer their own DSL *if* they paid that $40 to another company. Anything else is anti-competitive.

    2. The rules don't actually determine the price set. The Telcos can charge $500 for last mile if they want, BUT they can't offer cheaper services themselves.

This either keeps the telco renting bandwidth and owning the lines, or they either get problems with regulators or other companies start to build their own last mile if telco's ones are too expensive.

Re:Still need those damned wires (1)

bartappleous (1247854) | more than 6 years ago | (#22589270)

They tried that like ten years ago fifteen years ago with various Telco acts. Now those last mile companies are merging. I once worked tech support for a company called Eschelon. Eschelon touted how strong it was as a company by how many companies it was buying up. Eschelon's focus was on providing better customer service to complete with Qwest's bad reputation. We were a "last mile" and resale company. My job was to make the customer feel better about their 3 year contracts, and . Quite often customer's and customer vendors would call in calling us a "cancer". I had a really hard time saying, "I'm sorry you feel that way, but..." I totally agreed with them. We over charged buisness's for Qwest ADSL service. Many of our Sales reps out right lied to customers by telling them they were going to get 1.5 MB service when in fact they were getting IDSL. We charged a flat rate for all DSL products. It was called upto 1.5 DSL for 70 bucks a month not including the phone line and a 3 year contract to boot. And T1's. Don't get me started on T1's. Also with the benifit of a last mile company you get additional outages. The equipment and software that interfaced with Qwest would frequently take a dive. We had subcontractors that handled some of these products so we are talking about layers within layers of possibly redundant extraneous systems. Lost data and accounts due to overzealous executives purchasing random companies. Just before Eschelon was to be bought by Integra we purchased 3 other small to medium last mile telecoms. I have no doubt that we were attempting to boost our stock price to sell. There were rumors that Integra was also planing to go public. I have no doubt the ultimate goal of these west coast companies is to be the biggest fish so they can have the best sale price for Qwest. So all this is going on and the customer asks why their DSL only works intermittently all week. I cannot tell them that the lines we leased with Qwest are nearing capacity, and their DSL has been throttled, because Integra will not let us lease any more lines with Qwest until we are migrated over in 6 months. What we are talking about here is a problem that is endemic with telecoms. Every competition has a winner in this industry. Bigger means more subscribers and less over head. There is an inevitable tendency to gobble up the nearest competitor before he gobbles you up. Inevitably, what you end up with is a bunch of poorly thought out business's in charge of people's life lines to the out side world. The competition of which you speak is a fantasy.

Re:Still need those damned wires (1)

Sosarian (39969) | more than 6 years ago | (#22588648)

Of course a wireless phone can sound as good as a wired one, just some compromises were made in order to fit the number of phone calls into the same spectrum.

Re:Still need those damned wires (1)

pla (258480) | more than 6 years ago | (#22588742)

This is just not going to happen. Why? Because there is still a question of physical wiring involved.

Don't confuse "becoming their own ISP" with "becoming your ISP".

The average user's home server does not count as a "destination", as used here. ISPs don't threaten to make you pay more if you want all that wonderful ad revenue to keep flowing your way.

Instead, this deals with only the biggest of players (such as Google), where the telecos have basically done their best to make the cost of Google acting as its own ISP lower than merely paying someone else for a fat pipe. Under those conditions, why wouldn't Google want to take their ball and go home (or in this case, take their ball and build their own stadium)?

Re:Still need those damned wires (2, Informative)

X_Bones (93097) | more than 6 years ago | (#22589024)

You just can't get around the fact that a wire (fiberoptic or copper) still has to be laid out there for the best results. And no "destination site" is going to be laying that line anytime soon.

Maybe you should try telling that to Google. [slashdot.org] I bet they'd be pretty surprised.

Wrong on so many levels (2, Interesting)

securityfolk (906041) | more than 6 years ago | (#22587758)

What if the destination site doesn't want to be owned by a telco? What if the telco doesn't want to provide the same type of content management access the site maintainers had before? What if the telco wants to charge the owners for what was previously free? What if there's a telco bidding war for who gets to own which site? And on, and on...

Stick to your core (4, Interesting)

dazedNconfuzed (154242) | more than 6 years ago | (#22587768)

Every company has an essence that it must stick to. If it gets too far outside that core product/service, it almost invariably suffers and often dies.

Retailers do not build major roads to facilitate reaching their stores.
Road-building contractors do not go into the retail business.

For a _few_ businesses, expanding into infrastructure construction may be required - but only to jump-start the market, at which point they need to get out of the infrastructure business ... and at which point they often get overrun. Compuserve, AOL, etc. needed to build infrastructure to serve their content business ... but when the infrastructure was there, customers went elsewhere and both are now largely also-rans.

Electricity, natural gas, etc. providers have largely given up their infrastructure business.

Internet backbone service providers simply do not have what it takes to go into the content/destination business. It's simply not what they do, and others do it far better so long as there is sufficient infrastructure to support them. Google may be getting into the infrastructure business, but only to boost infrastructure capacity to match where they want to go in their core business; when Google gets the infrastructure to where they need it, they will have to let go of the infrastructure business because, simply, it's not what they do.

Re:Stick to your core (5, Interesting)

NineNine (235196) | more than 6 years ago | (#22587910)

You're exactly right. Case in point: Sun. Sun floundered every time McNealy got some stupid idea to vastly deviate from the core of what Sun is good at. Some would argue that all of these deviations from their core business is why Sun is in the trouble they're in now. McNealy is a shitty CEO, and should have been canned a long time ago.

Re:Stick to your core (1)

Chanc_Gorkon (94133) | more than 6 years ago | (#22588146)

Hmm....AEP does all of the power things here.....the plant, the wires....everything. Now I can see it with the gas company but with electric, the danged power is always going off.

Re:Stick to your core (1)

Mikkeles (698461) | more than 6 years ago | (#22588314)

'Road-building contractors do not go into the retail business.'

Hmmmm; "Fred's Fill Dirt & Croissants"?

Re:Stick to your core (1, Insightful)

Anonymous Coward | more than 6 years ago | (#22588318)

Every company has an essence that it must stick to. If it gets too far outside that core product/service, it almost invariably suffers and often dies.

You mean like these guys? [wikipedia.org]

Exceptions are rare (5, Interesting)

dazedNconfuzed (154242) | more than 6 years ago | (#22588670)

Yes, I was thinking of GE as being an exception when I wrote that. (Viable posting sizes do not lend themselves to detailed analysis of every conceptual variation.)

GE came into being, and largely succeeded, by having the core competency "general electric": they did pretty much anything that had to do with electricity, and that at a time when a company _could_ (broadly speaking) do anything and everything having to do with electricity (kinda like IBM and computers for a long time). They stuck to their core competency, and it worked. As the company flourished, they were able to branch somewhat into other stuff - but kept that core alive, without which all would fail.

Eventually, the "electrical stuff" business got so vast and detailed and nuanced and competetive that General Electric had to largely get out of both the "general" and "electric" parts of the business. In came Jack Welch, who managed to do something _rarely_ done: change the core competency of a business, and survive. Since GE's massive growth had branched into so many subjects (not all electrical), and had gotten so successful at some of them (again, not all electrical), Mr. Welch re-wrote the core competency to "#1, #2, or not in the business". Everything GE (no longer an acronym, just a meaningless couple of letters) was not best, or second best, at was mercilessly pruned. "Neutron Jack" got his nick for vacating life from vast swaths of the company, but leaving the buildings standing. Plastics? Jet engines? Financing? not electrical, but darn good at it - so it stayed, adhering to the new core competency. Most consumer products (tape players, radios, TVs, etc.)? electrical, but losing out to Sony and other competetors, so cut the losses, don't fight where you won't win, dump the business. Train engines? actually giant electrical generators on wheels, and the department was really good at it, so that business stayed. Hydroponic farming? not electrical, they weren't good at it, and it was dropped - you probably didn't even know they tried it. #1, #2, or get out - that became the new core competency, and on a dime GE turned mercilessly to implementing it.

Yes, companies can survive changing their core competencies. To do so, they must make the change wholesale - and _stick_to_it_. Most try but fail because they didn't really change, they just branched, got lopsided, and fell over. "Do or do not, there is no try."

To the thread's point:
Telling a telco to get into the destination website business is lunacy. They're not in that business, they didn't develop competency in that business as facilitating their core, and the suggestion they try it comes directly from failing to succeed in their core competency - switching won't help because frankly they suck at both. GE succeeded in switching from making electrics to, well, making money because they were GOOD at the original core competency, and when they had to switch they had a good tangent to switch _to_, and they _made_ the switch _totally_. If telcos want to "win", they need to get GOOD at their core competency of bandwidth delivery; if they want to switch, it must be _to_ something they're already good at, developed as a tangent to the prior competency - and they have to switch completely, without mercy.

Re:Stick to your core (3, Insightful)

aredubya74 (266988) | more than 6 years ago | (#22588592)

Retailers do not build major roads to facilitate reaching their stores.

True, but the bigger ones certainly have a hand in what gets build where and with what money. Wal-Mart frequently gets involved in legislation and appropriations to get government to pay for roads to/from their shipping centers and retail outlets. For example, the 2005 federal highway bill [progress.org] - "The federal highway bill contains $37 million for widening and extending the road in Bentonville, Arkansas that is the main access point to the headquarters of Wal-Mart Stores Inc." The key is that they don't build the roads themselves. They simply lobby their reps in Congress (and the state legislatures and local boards/councils) to get funds to build and widen highways that are important to their retail and shipping businesses.

A similar story played out in my neck of the woods, when Wal-Mart offered to put forward some funds upfront to get a state/local project going to widen a portion of NH state Rt. 28. This would've improved access to their existing store in Salem, NH, as well as a planned SuperCenter in Derry. Eventually, the plans were put aside after Wal-Mart walked away from the new building plan, but millions in tax dollars and tax incentives to Wal-Mart were on the line due to this highway building project.

Re:Stick to your core (1, Interesting)

Anonymous Coward | more than 6 years ago | (#22589102)

Retailers do not build major roads to facilitate reaching their stores.
Actually, I can think of numerous examples where retailers have indeed done just that. The best example I can come up with off the top of my head is in the shopping district of Ikebukuro in Tokyo, Japan, where two huge old department stores - Seibu and Tobu - built railways to their stores. And not just a cheap tram along the road, they are serious railways.

I have to concede that there's more at play than just shopping here - in typical japanese style there was a long-term strategy at work here. Both of them bought up huge amounts of land in Ikebukuro, cheaply because it wasn't a popular business and shopping precinct - then proceeded to make it popular by building shops, buildings, everything, and a train to get you there. They made a *lot* of money in a typical japanese 30-year-plan kind of way.

So some retailers - or more to the point, real estate developers with nerves of steel and a multi-decade planning horizon - can and do do exactly what you said. However, I agree with you anyway, because real estate and buildings are a long-term play and any single website or group of websites - with the sole exceptions, i would say, of Google and POSSIBLY Yahoo Japan - can't rely on anything like that kind of long asset life in order to recoup the massive NRE.

Re:Stick to your core (0)

Anonymous Coward | more than 6 years ago | (#22589314)

Internet backbone service providers simply do not have what it takes to go into the content/destination business. It's simply not what they do . . .

Part of the problem is that with cable modem companies, the ISP is also into content generation/delivery - although generally not Internet-type content. They have a vested interest in getting you to watch more TV, and spend less time online - particularly where people are finding direct substitutes for TV programming online (Youtube, P2P, etc.).

This doesn't explain why AT&T wants to f**k over its broadband customers. Perhaps the better analogy for them is that they have gotten used to the cellphone (or more similarly, the SMS) market, where they get to charge both parties for the communication.

The other angle is that the broadband companies are only interested in flat rate services where the rate far exceeds the cost of the service. To some extent, less use = less cost = more profit. Use more bandwidth than the typical customer? You are "undesirable" because you are less (not necessarily even un-) profitable. Charging per GB might more accurately impose costs on those who do push around crazy amounts of data, but at the risk of not hitting 1000's of grandparents up for $40/month. Also, if broadband service providers did charge a known amount per GB, it might result in competition on rates, which telcos have historically hated...

Other way around (5, Interesting)

Telvin_3d (855514) | more than 6 years ago | (#22587776)

Personally, I think that a law explicitly preventing internet access providers from supplying any service except the pipe would be one of the healthiest things that could be done. It would prevent conflict of interest situations and promote real competition. Similar to how the movie studios are no longer allowed to own theater chains.

Having the access and content sides of the internet separated means that things like VOIP providers get an equal playing field. The internet provider no longer has the incentive to sabotage them. In a couple years, it will keep them from messing with video download providers in the same way.

Arg. (2, Insightful)

Rob T Firefly (844560) | more than 6 years ago | (#22587778)

"I think the telcos have to make sure they don't get marginalized to being just bit providers and bandwidth providers," he said. On the other hand, carriers may be able to head off Internet sites by limiting the bandwidth available to them, so destination sites may need to affiliate with the carriers, he added.
Is it too much to ask that our Internet connection provider be focused on providing us a connection to the Internet, rather than trying to distract us from the rest of the Internet with their own stuff?

This is rather like the phone company cutting off your calls to inform you of all the great 900 numbers you could be calling instead.

Re:Arg. (0)

Anonymous Coward | more than 6 years ago | (#22587972)

We noticed you are calling your girlfriend, would you like to try our superior "Dial-a-girl" service for only $4.99 a minute?

Belkin (1)

dazedNconfuzed (154242) | more than 6 years ago | (#22588948)

Belkin tried that. Backfired bigtime.

For a while they sold a router that would, occasionally, take you to a Belkin ad page instead of the website you wanted.

Years later I still won't buy any Belkin products. I'm not the only one. That stunt cost them far more than they made.

Response (0, Flamebait)

cordsie (565171) | more than 6 years ago | (#22587782)

Hasn't Sun been falling behind in the just-about-everything race for quite a few years now?

Re:Response (1)

canuck57 (662392) | more than 6 years ago | (#22587988)

Hasn't Sun been falling behind in the just-about-everything race for quite a few years now?

Yep, too much Java beans I think. They have to get the lead out of Java. I have learned over the years when Nealy's makes comments like this next quarter sales announcements at Sun are not going to be good.

borderline diffuses (1)

spectrokid (660550) | more than 6 years ago | (#22587790)

Here in Denmark, the former state owned telco just decided to outsource the complete network, both mobile and fixed. They want to concentrate on their core business: selling subscriptions. On the other hand, you see Google looking for dark fiber and wireless spectrum. The borders between client, content server and carrier are getting more diffuse. Hopefully, the increasing chaos is going to make it more difficult for the control freaks to build a non-free ^H^H^H^H^H , I mean, more secure internet.

ISPs competing with their customers? (2, Insightful)

Anonymous Coward | more than 6 years ago | (#22587816)

Not a good scenario. Imagine Verizon giving more bandwidth to their search engine than to Google's, more to their auction site than eBay's, more to their SuperPages site than to AutoTrader. Sad. And sadder, I can't imagine the telco-lapdog FCC caring about it.

This is why McNealy isn't the CEO any more. (1)

unstable23 (242201) | more than 6 years ago | (#22587824)

His brain suffers some kind of disconnect from reality. The past few years are littered with companies that tried to do both, and are now dead in the water (see AOL).
The ones that did well are the ones that stick to one thing - the telcos do telco and ISP stuff, the content providers (Yahoo, Google) do content. In each case, they have a good core competency and stick with it. You don't need to diversify like that. Probably the only caveat to that is the cable companies, who have their own TV stations, but they still don't have (generally) important Internet destination sites.

Ultimately, for the telcos, being a utility works, because they have that corporate mindset. The analogy would be trying to buy a TV from the electricity company - they don't do that, because there are people better at selling TVs than them.

Re:This is why McNealy isn't the CEO any more. (1)

sm62704 (957197) | more than 6 years ago | (#22587924)

His brain suffers some kind of disconnect from reality.

No, he's trying to sell hardware and hopes that YOUR (or rather, whoever runs a telco) brain is disconnected from reality.

Re:This is why McNealy isn't the CEO any more. (1)

downix (84795) | more than 6 years ago | (#22587968)

Pardon me? *looks at the Best Buy webpage, with the GE TV's front and center*

Want to double check?

Re:This is why McNealy isn't the CEO any more. (1, Interesting)

Anonymous Coward | more than 6 years ago | (#22587996)

Actually, I think the analogy would be better served as buying a TV from the Cable company. You know for a long time you had to get your phone, from guess who, the phone company. They were providing the infrastructure and the "destinations". You still find phones that are still sold by the phone companies.

This argument that you cannot be an ISP and a content provider is bullshit. What hurt AOL was not this dual position, but was their inability to successfully switch to broadband service and their insanely expensive rates that did not come with service to match. Then there was that horrible TW-AOL merger. AOL was terribly mismanaged, but everyone wants to use their position as both an ISP and a content provider as the reason they failed. I guess history is written by the idiots who will believe what they want to believe.

Re:This is why McNealy isn't the CEO any more. (1)

unstable23 (242201) | more than 6 years ago | (#22589022)

OK, so point me to one successful ISP/content provider. With real content, not just some aggregator of other people's stuff.

(Good) content is hard, and is not in the core skillset of a good ISP/telco.

CHANGE IS BAD! (1)

erroneus (253617) | more than 6 years ago | (#22587838)

The very idea of change is just horrifying. They don't want to change anything about their business model as it brings about uncertainty. If they keep everything exactly the way it is now, they won't have to pay anything extra for upgrades and their profits will continually grow as they raise rates and add bullshit fees for crap that isn't even an option.

Do we want content providers to own the net? (1)

maillemaker (924053) | more than 6 years ago | (#22587860)

I for one really don't want content providers owning the infrastructure to access content.

Guess whose content they are going to throttle and whose they are not?

Re:Do we want content providers to own the net? (2, Informative)

Chanc_Gorkon (94133) | more than 6 years ago | (#22588178)

Yeah roadrunner, Verizon Wireless and others already do this. I use Mobile Web on my phone and I can't change the homepage on the phone to something else. It sucks.

Destination becoming ISP ... (2, Insightful)

Gopal.V (532678) | more than 6 years ago | (#22587904)

"Some" people are way ahead [google.com] of the curve [slashdot.org] on being an internet of its own [news.com], but not only the telco wired land [slashdot.org].

After all, the network is the computer [sun.com] ... BHWAHAHA ! ;)

Re:Destination becoming ISP ... (0)

Anonymous Coward | more than 6 years ago | (#22588058)

The computer is the computer, the network is the network...

Sorry for the confusion

Bandwidth is a commodity (2, Insightful)

Skrynesaver (994435) | more than 6 years ago | (#22587984)

Bandwidth is becoming a commodity in urban environments and as a result ISPs and Telcos have to offer something more.
eg. mail is still a cost for, and from, most ISPs yet you can get a better a/c than they offer free from GMail.

The solution of course is, not to have an auction for the latest, soon to be extinct, DotBomb 2.0 bauble (Facebook I'm looking at you), but rather to develop a useful portal for your users,

Integrate Webmail and WAPmail, offer file hosting/backup facilities, offer file sharing facilities, offer community building facilities and generally cater your service to your user base so that they see you as providing their favourite car rather than just a road, (c'mon it's /. I had to stick in a car analogy)

In short it isn't enough just to offer connectivity any more, though if you're selling 16.4Tbps you may have an advantage for a while.

Re:Bandwidth is a commodity (1)

Compholio (770966) | more than 6 years ago | (#22588532)

Integrate Webmail and WAPmail, offer file hosting/backup facilities, offer file sharing facilities, offer community building facilities and generally cater your service to your user base so that they see you as providing their favourite car rather than just a road, (c'mon it's /. I had to stick in a car analogy)

In short it isn't enough just to offer connectivity any more, though if you're selling 16.4Tbps you may have an advantage for a while.
You know what's funny? That's what I remember ISPs doing in "the good old days", but those integrated services, hosting, and backup facilities managed to dry up. What I distinctly remember was how a LOT of providers used to advertise that you'd get 50MB of free storage in your home folder (http://www.provider.net/~jdoe/), I don't know when exactly such practices stopped - but they obviously decided that there were more profitable ways to get customers.

Re:Bandwidth is a commodity (1)

Skrynesaver (994435) | more than 6 years ago | (#22588664)

I think part of that was the transition in userbase from those with an understanding of the underlying technology to those who wanted to see the pictures of the kitteh.

As the expanded userbase has started to get bored of looking at cute pussy cats they are developing an interest in the technology itself and what else they can use it for, hence a return to ~'96 style services/portals but that market has moved on in the meantime so IPSs will need to buy in frameworks/expertise to achieve credible modern services for their expanded userbase.

I'd expect to see a lot of consolidation in the ISP market in the next few years and an expanding market in integrated HTTP/VOIP/GSM/WAP service provision frameworks.

Of course I could be totally wrong here and they'll all want a nice safe, secure network and we'll see a return to the AOL model, I hope not but no one lost money underestimating the intelligence of the general public

This "stuff" can change extremely quickly (5, Insightful)

blind biker (1066130) | more than 6 years ago | (#22588030)

In 1999, when I started working for a big telecom equipment company, in Finland mobile phones had a market penetration of about 45-50% (most adults) but pretty much every household had a fixed line as well. In only 3 years almost everybody discontinued their phone subscription - everybody has at least one mobile phone, including kids aged 7 or older. Let me repeat: 3 years.

Things change very fast in the world of telecommunications.

So could it happen that companies like google, yahoo etc. become partly telecoms? Will, what google is trying to do, become a megatrend? I don't have a magic sphere, but from what I can see, I'd say it's more likely than not. And if/once this ball starts rolling, the telcos better have a good strategy or they'll be wiped out or "considerably diminished".

Re:This "stuff" can change extremely quickly (0)

Anonymous Coward | more than 6 years ago | (#22588274)

In 1999, when I started working for a big telecom equipment company, in Finland mobile phones had a market penetration of about 45-50% (most adults) but pretty much every household had a fixed line as well. In only 3 years almost everybody discontinued their phone subscription - everybody has at least one mobile phone, including kids aged 7 or older. Let me repeat: 3 years.

Mobile will never have the reliability of landline service. I have never picked up a landline phone and not had working phone service (I'm 36).

Even though I have a cell phone, I like the solid reliability of landline service.

Is this really true? (2, Informative)

MyNameIsFred (543994) | more than 6 years ago | (#22588584)

...In only 3 years almost everybody discontinued their phone subscription - everybody has at least one mobile phone...
I don't live in Finland, so I can't speak from personal experience, but your statement is at odds with news reports [cellular-news.com]. As I understand it, while cellphone penetration is very high in Europe, so is landline penetration. IIn both Europe and the US, about 80 percent have a cellphone. And a comparable percentage have landlines. In the US, many of my friends have tried dropping their landlines. However, a large fraction get them back because of the higher quality of service. Certainly, I vastly prefer the landline quality, it sounds so much better.

Re:Is this really true? (1)

TobascoKid (82629) | more than 6 years ago | (#22589286)

If you look at the graphic on that page, 47% of people in Finland have a mobile but no landline. While not really "almost everybody" it's still almost a majority. The EU average is 18%.

Re:This "stuff" can change extremely quickly (1)

laffer1 (701823) | more than 6 years ago | (#22588748)

I feel that the change was forced by telephone companies. In my case, I am only using cell phones in my household. I can't understand why it's $50 for a damn landline. Sure they quote you $20, but add hidden fees, setup fees, monthly taxes and 911 portability charges, and you're near $50. Want caller id or long distance (heaven forbid)... that will cost you. And if you elect not to have all their damn services, they harass you with constant sales calls.

Yeah I tried VOIP too. It was great at first. Then the government stepped in and made them start charging all those taxes, 911 charges, etc. Then they made it so you can't move your phone around with you due to 911 requirements. Soon that nice $20 bill was $30. The last straw for me was when Verizon (originally MCI) told me that I couldn't transition to the new number when I moved that I setup. The power company required a phone number in the area and we didn't want a landline. I made the silly mistake of thinking that I could just add a 734 area code number to my VOIP and KEEP IT after I moved. Wrong. They told us we had to get rid of the number which would cause problems with our power company who is also very inflexible. The solution was to switch cell phone companies and take the number from the VOIP over to cellular. We then dropped VOIP since they didn't want to give us proper service.

Granted, this is just one experience and many people swear by vonage or skype. I just don't think these changes in three years that you speak of are anything to do with technology changes, but rather the increasingly poor customer service we get.

Today, companies want to be a monopoly or nothing. They must have all the customers or they are unhappy. They will do anything to get you back when you leave, but they don't care about you while you're there.

I don't think AT&T should become Google, but I'd love to see companies like Google compete with AT&T. I can always pick a smaller search engine if things go sour, but at least there will be competition for a time. Competition means lower prices and proper service.

Could be dangerous (1)

Chrisq (894406) | more than 6 years ago | (#22588046)

If your ISP becomes a provider then we really need very strong net-neutrality laws, with means of testing and enforcement. If we don't then throttling back the opposition could become common practice. The internet could end up fragmented with reasonable VOIP, etc. only working between two people using the same provider.

Re:Could be dangerous (1)

Crypto Gnome (651401) | more than 6 years ago | (#22588136)

Let me correct that for you:

The internet could end up fragmented with reasonable VOIP, etc. only working (if ever) between two people using the same provider.

Please muzzle this imbecile! (4, Interesting)

billcopc (196330) | more than 6 years ago | (#22588168)

First of all, they do need to concentrate on providing bandwidth, because right now they really suck at that primary role.

Second, I don't want any of these skeevy telcos acquiring popular web sites, because it is inevitable that they will ruin them. Here's why:

A hypothetical company XYZCom, who provides my residential broadband connection, buys out and operates Slashdot. They now control both ends of my internet experience. What's can stop them from automatically charging me a nickel every time I hit "Reply" ? Nothing, it's incredibly easy for them and they can trivially word something in their contract to that effect. Then XYZCom decides it is unprofitable to serve outside users, restricts Slashdot to telco members only. I get burned, everyone leaves Slashdot and go post mindless drivel on Kuro5hin, world collapses under the sheer weight of inflated art-school dropout egos. Then the best part is when the telcos whine to the guv't about being so poor since Slashdot died, and get some new bill passed to defraud the general population even harder. Lather, rinse, repeat.

Besides, it just feels wrong to give the telcos even more power. That's like getting mugged by some wigger, and handing the little suburban faux-thug a bigger knife with which to threaten you. We already have few defenses against these corporate sellout behemoths, we don't need to be giving away our beloved internet.

Goodbye network neutrality (2, Insightful)

Per Abrahamsen (1397) | more than 6 years ago | (#22588220)

Way to go McNealy, if we mix content and transport there won't be any network neutrality.

If anything, there ought to be anti-trust legislation preventing the same company to own transport and content, and preferable not "enabling technology" (browsers, operating systems) either.

Re:Goodbye network neutrality (1)

MadAhab (40080) | more than 6 years ago | (#22589172)

Exactly. He's a first-rate asshole most of the time he opens his mouth.

Vertical monopolies are bad for the economy, generally speaking.

Earth to Scott: we already tried bundling access and content. Remember online services like AOL and Compuserve? They got their asses handed to them by the openness of the Internet.

What kind of cretinous, drooling idiot, outside of a CEO of a company offering broadband, wants to go back that way again?

Doesn't make any sense (1, Insightful)

llZENll (545605) | more than 6 years ago | (#22588234)

It is ridiculous for every major content providor to be a telco, it costs huge amounts of money to buy or build an infrastructure and support it. If every major content providor (100s of them) wanted to run their own network there is not enough physical space to run the cables to do so. If the 3 biggest powers in the tech world, MS, Yahoo, or Google can't even do it, what the hell makes you think anyone else is going to? And even if all of them build their own networks, the 99% of the rest of the internet is going to need an open network to use, so we will still need the telcos.

The only way any of the big content providors are ever going to have their own network is if its a wireless one, and due to the major federal regulations and licensing costs in doing so, even Google is having a hell of time trying to get it done, and even then how much internet activity is done wirelessly, not much.

Portals! (1)

Pope (17780) | more than 6 years ago | (#22588244)

Hey, remember the late 90s? Portals!

It's the convergeance answer for every business problem! Portals!

So why is AT&T doing the exact opposite? (4, Insightful)

alen (225700) | more than 6 years ago | (#22588364)

the cellphone companies are the same telco's that provide the backbone of the internet. for years now they tried this by selling cell phones and providing all kinds of media services for them and AT&T is now making more money being a dumb bandwidth provider to the IPhone users. there was a /. story on this last month. and the rest of the telco's seem to be following AT&T's lead.

I think scott is just talking out of his anus and is afraid he is going to sell less servers to the telco's to provide all these media services.

in business it's usually not a good idea to get into too many things that aren't related because you lose focus and start being bad at everything. very few companies are like GE that can compete in many fields successfuly

Re:So why is AT&T doing the exact opposite? (1)

cornercuttin (1199799) | more than 6 years ago | (#22588560)

I think scott is just talking out of his anus and is afraid he is going to sell less servers to the telco's to provide all these media services.
exactly. what is his core business? selling hardware. what would bring him more revenue? if the big telcos would buy a ton of high dollar expensive hardware from him, and he is going to try to change the market and make statements like this in order to do so.

his job is to bring in money for Sun, and this would do it, which is why he says this. averagejoeblow.com can't afford a Sun data center, but AT&T running averagejoeblow.com can!

it would be infinitely bad for this. this is why Disney doesn't make TVs, or why Boeing doesn't run an airliner service, and its why Cisco doesn't own a telco. overextension is real, true, and can weaken your core business.

Gee, someone else gave this speech 2 weeks ago (1)

pcause (209643) | more than 6 years ago | (#22588410)

2 weeks ago, the head of Softbank gave a speech at the big mobile industry show in Barcelona basically saying this same thing to mobile carriers. Not an original thought, Scott.

Oh geez not portals, NOT AGAIN. (5, Insightful)

SmallFurryCreature (593017) | more than 6 years ago | (#22588534)

Goddamn, someone needs to kill this guy before any execs fresh to the job pick up on this idea. I say fresh to the job because any old hand will have seen this before. Portals. The days when the idea was that the web started at your ISP's home page. When every ISP had a newsfeed, poorly implemented, with no depth, but a ISP portal had to have the news, and so they bought the cheapest feed they could, implemented it badly and put it on the front page.

Filled offcourse with all sorts of content you could buy from the ISP, but not the actuall content that actually is bought on the net, PORN. Hell, I worked for one ISP were they had special code for the frontpage that would only display the porn links during the late hours. Not that it really worked, because invariable the ISP content sucked compared to what was available on the real net. McNealy? The 1980's called, they want their AOL back.

The problem is that it sounds so logical. If you do not provide food services on your train stations dear transport company, then someone else will. It forms quit a bit of income, all those stands, often at least partially owned by the train company itself. It used to be they even provided pretty decent service.

Ever seen a gas station that just sold gas?

So why doesn't the same go for ISP's selling content? Because the train station example has one simple advantage. LOCATION. When I travel by train it is easier to use the supplied services at the station then go outside and get food there.

The same does NOT go for ISP's. I can switch between content sides at the press of a button, there is absolutly no reason for me to visit my ISP's newsfeed when I can go straight to the source. Why should I buy music from my ISP when iTunes is just a click away? Why should I use their branded search engine when google is just a click away?

IF ISP's had a form of lockin it makes sense, say that visiting the BBC news site cost me money and my ISP's Reuters newsfeed was free then I could easily see that some people would choose the inferior but cheap option.

Just a couple of minutes from Arnhem train station was a fast food shop with really good self-made snacks, cheaper as well, compared to the concesion stand at the station itself, but still, because it is hassle to walk the detour the crappy snacks at the station fetched a higher price.

The idea itself works, it just doesn't work for the Internet.

The older people among us know this, because it has been tried. In fact many a customer got so fed up with it, that entirely new companies jumped in the market ADVERTISING with the fact that they offered JUST internet access and nothing more.

And lets face it, it is a lot easier for the ISP's. If they sell music then they got to haggle with record companies, invest in servers, deal with complaints. If they don't sell music, they collect for the transmission of the music their customers get from whatever company is wiling to risk it. You know, my ISP EVEN gets its money when I pirate music. Let iTunes worry about what the record labels will do next, my ISP just transmits the data and gets paid for it.

No McNealy, you sometimes seem almost clever, but this article marks you as just another tie without a clue.

You are trying to sell portals. No thanks.

Re:Oh geez not portals, NOT AGAIN. (2, Insightful)

robot_love (1089921) | more than 6 years ago | (#22589206)

In general I agree with you, but I think you're missing one thing:

Telcos are trying to make themselves the train-station. Without net-neutrality, your ISP can limit your access to the places you'd prefer to go. They can sell a lot of sandwiches if you're locked in the train station!

Market Reality Check?! (1)

Maljin Jolt (746064) | more than 6 years ago | (#22588570)

"I have explained to every telco that either you become a destination site, or the destination site will become a telco,"

Scott, have you tried to explain to every bank that either they become a grocery store, or the grocery store will become a bank?

Re:Market Reality Check?! (1)

sunderland56 (621843) | more than 6 years ago | (#22589084)

Bad analogy. (Although around here, there is a bank in every grocery store....)

Better analogy: Disneyland will buy up all of the highways, or the highway system will buy up Disneyland.

Re:Market Reality Check?! (1, Interesting)

Anonymous Coward | more than 6 years ago | (#22589210)

Most(all?) grocery stores near me have a bank branch inside them now. And a fair amount of them also now have gas stations.

perhaps the telcos need more retroactive stuff (1)

victorvodka (597971) | more than 6 years ago | (#22588776)

I'm thinking perhaps our Congress can vote to give our telcos retroactive research & development to go along with that retroactive immunity for their law breaking, thereby allowing them to give us better stuff here in the present - stuff like usable phone interfaces, good customer service, and open standards to communicate with our other gadgets.

90's called (0)

Anonymous Coward | more than 6 years ago | (#22589138)

They want the guy back.

Telcos should be common carriers again (1)

Animats (122034) | more than 6 years ago | (#22589352)

Telcos should be made regulated common carriers again. All they should be allowed to do is run data pipes. Everything else they do, they do badly anyway.

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