MCI has demonstrated they are going after the business market with their VoIP push that was announced today.
So while AT&T is going after consumers aggressively this quarter and likely for the next 8 or more, MCI has decided to go where AT&T has already been, the business market. But this time, with a twist. MCI plans to leverage their IP backbone, network infrastructure and add VoIP to their DSL offering to businesses to gather market share.
Their statement about QoS shows they know the marketing department at MCI recognizes its importance, cares about that and knows that decision makers, either IT managers or even worse, the person who is less technical–i.e. less tolerant of bugs, the office manager who really decides which phone service a company deploys will want that natively as standard equipment, not an option.
Who does this hurt? VONAGE. Vonage offers no QoS within their service, nor do they own their own network. Calls over VONAGE are routed over the public Internet, while calls over AT&T’s CallVantage are quickly moved onto the AT&T managed network, or in MCI’s case their own. With Level3 also looming out there to supply SIP based IP telephony, the upstarts like VONAGE, Packet8, VoicePulse, VoiceGlo, etc., need to begin competing on features, service and technology, not just price and some next generation applications.
The battle grounds are being carved out like gangs do in inner cities. Each carrier staking out their niche, but Machiavelli once said that territory establishes control, and Generals like George Patton all knew that the supply lines to the front mattered before you mounted an offensive. The supply lines are the national backbones which all the second tier ISP’s peer with. The same for the ILECs like SBC and Verizon.
For companies like AT&T, Sprint, MCI, Level3 and the almost forgotten QWEST, they have the supply lines, so too do companies like Verizon and SBC, both of whom are on imperialist like tracks to widen their reach. MCI, AT&T and SPRINT all have basically next generation marketers and business builders at their respective helms. What MCI and AT&T have done is become CLEC’s with their own networks. While everyone was predicting they would go after local service, they were using the time to develop IP, not PSTN solutions to sell. Now, they are marketing those products, while the ILEC’s are still trying to determine how to fend off the cable companies.
The more you look at this, AT&T had cable companies, which they shed. Had they held onto them, they would have had old plants (TCI mostly) that the cost to upgrade was so great it would have hindered their VoIP roll out. By not being a competitor to the MSO’s (Multiple system operators) such as Comcast or Cox, they are in an ideal position to be their friend in VoIP. If the cable company’s choose to do their own thing, so be it. They have bandwidth, but what they don’t really have any legacy in is voice, two way traffic or International termination. AT&T and MCI both do. Who do you think the conservative office managers will put their money on?