[qi:090] Just as AT&T (s t) CEO Randall Stephenson is conceding to the permanent loss of wireline revenue, high definition (HD) is emerging as a way to save the all-but-abandoned asset. HD finally gives customers of AT&T and other telcos a reason to retain wireline connections, for while the somewhat better voice quality associated with wireline already provides some resistance to cord-cutting, HD yields wireline telephone calls that sound dramatically better. The HD “being there” experience can make wireline an essential service, for everyone from deal-making lawyers to texting teens.
In a white paper I wrote back in December 2000, entitled “Telephony Unplugged” (PDF), I documented the threat wireless posed to wireline, arguing that the arrival of price parity between between the two would transform the business-focused wireless industry into a consumer phenomenon. The mobile industry subsequently tripled, as wireless-only customers grew to 20 percent from 4 percent. But while wireless HD options exist, lower cost and higher reliability broadband gives wireline an advantage.
Doubling the frequency response represents the starting point for HD (analogous to a move from AM to FM), but HD competition also promises to spark a steady stream of innovations. The call-by-call negotiation of codecs made possible by SIP renders HD a meritocracy. There are an infinite number of tuning options available to improve the acoustic performance of devices and navigate network impairments, and efforts to close the gap between remote and in-person meetings offers an endless range of research topics.
Mobile dominates the future plans of both telcos and cablecos, for the telcos view the year-over-year declines in wireline experienced since 2000 as permanent, and the cablecos are offering their digital phone plans to the same shrinking pool of customers. In the meantime, both have a range of HD implementation options that complement existing investments in data infrastructure. Which of them will get HD religion first, however, remains unclear. The wireless companies may even move first, as the 3GPP standard includes the wideband codec AMR-WB. In any case, HD represents the possibility of a communication industry organized around the novel notion of expanding communication functionality.