The Power and the Big Bell Dogma
There were two big announcements this past week worth stopping, observing, and understanding.
I’ll start with the good news. Hewlett-Packard this week announced innovative color matching technology which captures the power of mobility.
Quoting from the release: “Instead of sitting down with a consultant at a beauty counter, a shopper photographs herself using a mobile phone camera and while holding a specially designed color chart. The person then sends the photo as an MMS (multimedia message) to an advisory service. … In a matter of seconds, people using the service receive a text message response with a recommendation on the shades of makeup that are best suited to their complexion.”
The sub-title on the press release is “New mobile imaging technology provides consumers with expert advice via cell phone anytime, anywhere,” and the first line of the release is “HP today demonstrated a new color matching technology that could change the way people shop for products that require color coordination, such as cosmetics.”
HP is obviously demonstrating that it understands the impact that mobility is having on how we live and on how businesses compete. This is the power of mobility, and this innovation makes clear the potential for disruption in industries such as cosmetics, where certain activities (e.g. expert recommendations) are tied to a specific place (e.g. the cosmetics counter).
So the good news is that major enablers like HP are working to help companies capture the power of mobility.
The bad news is that the forces of the Big Bell Dogma keep resisting the Mobility Revolution at every turn.
This week, this was clear in draft rules created by FCC chairman Kevin Martin. The rules will require winners of some of the 700MHz spectrum auctioned this coming winter to open their networks to competitors.
In theory, open-ness is a great thing. In theory, it can encourage innovation and enable lots of companies to participate in building the power of mobility into new products and services. That’s certainly what Sprint hopes as it opens it’s upcoming WiMax network to innovation.
The real problem is the upside-down-ness of Chairman Martin’s logic. The FCC head has been a dogmatic defender of the Bell’s wireline monopoly, allowing any remaining competitive gains from the 1996 Telecom Act to vanish into the mist while allowing the Bells to consolidate into even more powerful dominators of the industry. Chairman Martin has embraced the argument that forcing pro-competition regulations on the century-plus year old monopoly wireline world would make investments in wireline broadband unattractive, and thus must be avoided at all costs.
However, in the nascent, non-monopoly world of wireless, where at least four viciously competing providers serve most parts of the country, Mr. Martin believes that pro-competition regulation is required.
What is the likely impact? Such regulation certainly does introduce risk into the investment model, potentially slowing the investments required to build a robust broadband network using this new spectrum. It will also devalue the spectrum in the eyes of bidders, resulting in lower revenues for the government. And all of this is unnecessary as the industry itself moves increasingly towards opening their networks to innovation, but with the ability to manage that openness to market driven business sense, rather than being subjected to burdensome, bureaucratic regulators who don’t even know what innovation looks like.
Om Malik provided excellent commentary on this turn of events late last week. Here are some quotes from his piece:
- “For rest of the planet, competition means opening up the existing networks, forcing the incumbents to share the last mile resources with the upstarts, so to speak.”
- “Many have forgotten that it was during Martin?s incumbent-accommodating tenure that line sharing or ‘international’ style competition was sent the way of the dodo in the US.”
- “Instead of taking this more common sense approach, in the US, we have seen a strategy called the ?politics of fear? being effectively used (with FCC doing nothing) to effectively choke the competition.”
- “Instead we have a situation where a new network is going to be built (if the incumbents allow it), which in turn means billions of dollars spent on building a new infrastructure, and no one exactly clear about when the consumers are going to see the benefits.”
As the Big Bell Dogmatists continue to throw every barrier possible in front of the Mobility Revolution, let us hope that those, like HP, who understand the power that is being created by mobility, will continue to innovate and unleash that power for you and I.