Going through a little history: Company hoping to make a profit soon. In ’90s you could raise money but turmoil when the bubble burst. Level 3 was funded enough to last and see industry change.
Not long ago, communications was utility — today telecommunication’s function is to provide the standardized connections. View of the future is standardized connections to the cloud. Bandwidth as a commodity — “Oops, I used the ‘C-word’!” But communications services are a technical commodity — successful company must be low-cost provider since demand is unlimited.
Finally we can anticipate that communications’ price performance will begin to compare favorably with processing and storing information. We do three things: process information, store information and move information (communications). Cost of communication has been relatively static, but the difference is the way the technical standards were set. Companies under the auspices of government-set standards — predictable, dependable, but glacially slow.
In the past, video would come to our homes by going to Blockbuster to pick up video discs and bring them home (Note from Liz: There is an awesome video about this on the Onion News Network). IP and optical innovations came from startups; these technologies are market-based, not centrally planned. Now technology and market demand make it possible for communications in this model.
- Demand for optical IP communications will continue to grow rapidly. It’s price elastic.
- Demand will be increasingly served by optical and wireless technologies.
- The individual is going to be the focus of information, and institutions will support this, so personalization and style will be increasingly important selling points.
- Communications services, devices, applications, and content will increasingly divide into separate markets. Level 3 thinks bundling doesn’t make sense.