Fast Lane, Slow Lane

Jun 17, 2014

As Google unveiled the first images of its self-driving car prototype, I could not help but notice its most prominent feature – the face across the front. This design element has suffered plenty in reviews and commentary, but I get it.

People can be uncomfortable with change at the best of times and trusting your life to a driving machine will be a challenge for a huge swath of the population. So I see merit in deploying the face when the public is first introduced to the self-driving car.

Google are essentially introducing this next step in technological evolution with the help of a preference hard-wired into our DNA from our own evolution. Since the graphic pattern babies prefer to all others is the human face – eyes, nose, mouth – the face on the car may help to mute the fears of the inner children in all of us.

In our own industry, we have had plenty of experience with resistance to change, particularly as we migrate away from 20th-Century infrastructure toward global, mobile, fibre-heavy digital systems. A major source of discomfort for providers has been on the pricing front as they traded dollars for dimes while moving to low-cost, fibre-based digital services.

These types of investments have long-term ROI horizons and break-even points are just beginning to come into view for some players. CenturyLink, for example, expects 2014 to be the year in which revenue from fibre finally matches revenues in current services lost (not capital in). CFO/EVP Steward Ewing stated: “Fibre to the tower revenue we’re seeing is accelerating to a point where it is covering the DS1s and DS3s that are being disconnected associated with customers moving to Ethernet services.”

On the demand side of the equation, enterprises to small and medium business (SMB) users are undergoing uncomfortable technological shifts in favour of solutions that deliver lower costs and enhanced speeds – demands that require telcos with fibre-based services. As they move to new systems and services, major enterprise CIOs at the recent MIT Sloan School CIO conference advised that they never tell their CEO or board of directors that all systems are secure. Instead, they must lay out what they will do in times of breach or breakdown. Their carriers, in turn, need to cover the same “what if” issues.

Of course, consumers struggle most with change as their providers shift services to stay competitive. Although entertainment demands have users crying for fibre with better speed and consistency, changing voice services to digital or mobile replacements takes finesse.

Verizon attempted to field-test an all-mobile solution on the beach areas near New York City after Super Storm Sandy soaked the copper wires, but had to lay fibre to quell complaints from residents. AT&T is awaiting permission for field trials of fully digital service in two towns in Florida and Alabama, and it is a safe bet that lots of handholding is occurring, with the amount of pain commensurate with the number of years the customer has enjoyed traditional copper service.

In contrast to a forced switch, Frontier is using copper to offer a $5.00 per month, outbound-only line where it has copper, covering those who fear power outages or the inability to reach 911. Perhaps this will keep revenues trickling in while the copper generation gives way to the mobile generation.

All of these examples point to constant pressure for telcos to be prepared for competing end-user demands. Some hold to the past while others demand the future.

Ultimately, however, progress always wins out. Seniors (75 plus) represent the fastest-growing user segment in social media, proving that, eventually, everyone comes around. Of course, as Google’s self-driving car designers might point out, a major draw for this demographic is keeping up with family and all those pictures of their smiling faces.

We may not add smileys to phones any time soon, but demand for access to those faces is helping to drive many old-school holdouts into the digital age.

This analysis was originally published at Capacity Magazine.


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