Video still lauded as killer app, but will consumers pay what industry wants?

The burgeoning demand for bandwidth will continue as new applications hit the market, but carriers must be sensitive to the fiscal concerns of consumers. That was the overriding message at a session of a communications conference held in Ottawa last week. The NetVideoWorld meeting was a two-day session, featuring the major players in telecom, high-tech and related industries. One discussion, entitled The Future Network: The Telco’s Perspective, had representatives of ILECs, CLECs and the cable business discussing how the industry can prepare for what lies ahead. All the panelists agreed with moderator John MacDonald, who began the session by repeating a familiar slogan, "video is the killer application." But some worry a killer application could kill them instead. "Investment must by supported by the willingness of the customer to buy," John McLennan, CEO of AT&T Canada stated. "We made a financial commitment not to throw money at vague ideas." Most consumers want more services for less money, he added, saying prices are plummeting in most sectors of delivery. Clayton Mangione, director of technology development for Bell Canada, found three areas which he declared critical: quality, reliability and customer flexibility. Proper handling of these can lead to opportunities for bundling, new services and new revenues. He predicts fibre to the home will be a reality within two years and suggests this will stabilize costs and standards. DSL versus cable Bell has been active in the last few months buying up content providers in its quest to achieve convergence. But others suggest monopoly ownership is not the way to go. Michael Stephens, service convergence VP of Group Telecom, argued that monopoly control by a carrier will not work. While telcos are increasing their share of the market, the overall leader is still cable. Rogers Cable SVP network engineering & operations Dermot O’Carroll produced American figures that show cable servers such as @Home and Road Runner are vastly more popular than DSL providers. He chided Bell, though not by name, for its ads suggesting the slowdowns that can occur on cable do not affect DSL also. The development of video over broadband has been a one step forward, one step back procedure lately. Last March Telus delayed its previously-announced plans to provide video-on-demand through a deal with Blockbuster Inc and Enron Broadband Services, with no new start up date in sight.

Video still lauded as killer app, but will consumers pay what industry wants?

News | May 7, 2001

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