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Telecom: No Country for Entrepreneurs

In the months and (hopefully) years ahead, you'll read posts on No Jitter from folks like Matt Brunk, Michael Finneran and the team of Hank Levine/Jim Blaszak that reveal the love-hate relationship that enterprises tend to have with their telecom carriers. I wouldn't say that Matt is exactly on the "love" side of things, but he definitely understands the telcos from all angles, as you can see from this past VOIPLoop post.

Michael, Hank and Jim are much more skeptical of the carriers, and Hank and Jim especially have made frequent, eloquent, basically futile pleas for more competition. If public telecom were truly entrepreneurial, you'd think that would be good for the enterprise.

But public telecom is a scale business, and networks do benefit from some kind of "network effect" multiplier. Metcalfe's Law may overstate this benefit, but it does exist to some degree. The industry's scale gives the carriers disproporionate power, but it also is the most cost-efficient way to provide the services known as telecommunications. And many of us remember that the biggest problem in the CLEC days was that you basically couldn't use a CLEC for much if that carrier didn't have POPs everywhere your enterprise had locations.

The author of the GigaOm piece complains that telecom service has been commoditized, a marketplace environment in which only a scale player should even bother to participate. But commoditization is good, from the buyer's perspective. If you can get cheap pipes and fill them with your enterprise applications that do what you need done, you're a long way toward using this technology to its greatest benefit.

You could also use some network-based services like the ones mentioned, but enterprises tend to want to do it themselves, and consumers tend to want whatever's cheapest yet most reliable.

So give us large-scale telecom service providers, Santa. Just give us a couple more of them.