Intelligent pipes

Back in January last year, Yankee Group CEO Emily Green and I had a discussion about Net Neutrality. One of the aspects of the discussion that I remember from back then was how framing the semantic context of a debate affects the debate itself. Emily's example was  "pro-life", a superb concept branding, because it's really hard for opponents to say they're "anti-life". But "pro-choice" is a very clever response because it places the devate on a different level and it avoids going into the anti- territory.

With "net neutrality", whoever coined the terminology also framed the debate. Think about it: can a telco say he's for "net discrimination"? Of course not. Opponents to Net Neutrality have yet to find an equally effective term to balance the odds. Something that could be printed on T-Shirts and displayed at rallies (assuming telco execs wear T-Shirts and/or attend rallies).

Anyway, I was reminded of this discussion last week as I was preparing a presentation for a conference on Next Generation Access in Madrid. Not about net neutrality but about another piece of terminology that has a huge impact on the whole debate about where the telecom industry is moving: "dumb pipes".

"Dumb pipes" is the term used by telcos to describe what they do not want to be. They want to be high added value service providers, way above their historical business of network and communications. They want to prove to the markets (and to themselves) that they are not a utility business and in no way comparable to water or electricity. Hence relegating the "old" business to the status of "dumb pipes".

Let's disregard for a minute the fact that, in an economic downturn such as the one we're going through, being a utility is not the worse place to be. It strikes me that telcos may have - through the recurring use of this particular piece of terminology - convinced themselves not only that they were above the lowly utility business but that pipes were, by definition, dumb.

I keep being amazed at how little telcos are open to leveraging their capabilities for other players in the economy, and what I did in Madrid was try to demonstrate that the tricky FTTx business plan might look a lot better if telcos were willing to leverage their pipes intelligently. Unfortunately, if you've been drilling your troops for years telling them that your network business was dumb, it doesn't exactly encourage them to think creatively about extracting value from it. Even we at Yankee Group are sometimes guilty of this, with some internal suspiscion around the "wholesale" telco business.

Not surprising, really, when the terminology of the debate has already been framed (willingly or not). I therefore propose to promote (internally and externally) the concept of "intelligent pipes". Intelligent Pipes are network assets used to enable third-party services therefore creating new business models outside the telecom industry. From its direct contribution to these models, the telco can legitimately earn a revenue share that it's been struggling to obtain from over-the-top services (another tricky piece of terminology, as Daniel points out...)

This message has been cross-posted to the Yankee Group blog.