Kristian Kielhofner wrote: > On 1/4/09, Alex Balashov <abalas...@evaristesys.com> wrote: >> I think if this gets traction you will see a lot of providers doing >> ultra-low bait-and-switch rates. Most cannot afford to be in a price >> race to the bottom. >> > > Agreed. > > This current race to the bottom, while somewhat inevitable, is not > necessarily a good thing for customers.
There are presently very substantial differences between wholesale trunking providers based on who they buy from, what type of Internet connectivity they have / how they are peered relative to Tier 1 Internet backbones, what equipment they use, and the jurisdiction in which they operate and associated regulations. But, in the end, I think as some of this stuff gets to be normalised and evens out as the industry matures and networking adapts around it, VoIP termination and origination *will* become a commodity and the market will resemble perfect competition much more than it does today. That doesn't mean that small differences won't remain, that value-added features or platforms won't have an impact, or that fly-by-night operations will be tolerated, but in the grand scheme of things, the substantive business-level differentiators will be on the carrier side, where the cost basis can differ depending on how much network the competitive carrier actually has versus pure interconnection with an incumbent + wholesale long-distance via an IXC, or the equivalent concept in non-US markets where some degree of local loop deregulation also exists. In other words, wholesale termination and origination *will* start to look more like the market for agricultural products (wheat, grain, corn, fruit, rice), basic industrial inputs (steel, screws, bolts, molds), energy (oil, electricity, natural gas), precious metals (gold, silver, etc.), etc. This is one in which price and its relevance to logistics is the only pervasive and ubiquitous value differentiator. That's not necessarily a bad thing if the stuff that differentiates the offering really can be factored out. Increasingly, with time, I think it will be. The bad news for pure VoIP ITSPs anyone doing PSTN connectivity arbitrage or engaging in a variety of other resale models is that the ones with anything less than the most viciously competitive pricing will be forced out of the market--that's assuming that selling "minutes" will remain the network and/or facility monetisation model once the industry finds a solid private VoIP peering and settlement model and stands anything to gain from seriously beginning the process of deprecating the PSTN. We can agree that's not exactly around the corner right now, except perhaps in places that never had much fixed-line infrastructure to begin with. The good news is that substance (aka actual network build-out) will be rewarded over resale and arbitrage. Network build-out is capital intensive but adds actual value in the long run. -- Alex -- Alex Balashov Evariste Systems Web : http://www.evaristesys.com/ Tel : (+1) (678) 954-0670 Direct : (+1) (678) 954-0671 Mobile : (+1) (678) 237-1775 _______________________________________________ --Bandwidth and Colocation Provided by http://www.api-digital.com-- asterisk-biz mailing list To UNSUBSCRIBE or update options visit: http://lists.digium.com/mailman/listinfo/asterisk-biz
