Reflections on the OFC/NFOEC Executive Forum

The Forum went well, even the active vs. passive debate that I participated in. Some interesting observations and recurring themes:

• A speaker in an early session presented a view of the telecomm market as a food chain, where the service providers are the sharks, the equipment vendors are the fish, and the components vendors are the plankton. It was a great analogy, and was picked up by most speakers over the next two days.
• The components vendors don’t have a lot to be excited about. Margins are low, equipment vendors are getting beaten down on price and passing that along, and there is too much competition. The bright spots are in niches where small companies can differentiate themselves.
• Components vendors (and others in the industry) couldn’t care less what’s going on with the telecom acts in Washington, DC. To paraphrase the CEO of Avanex, he looks to Tokyo, Shanghai, and other Asian cities long before he looks to Washington. Washington just needs to get out of the way.

If you want complete details, pay up and attend yourself next time.

Editorial

An editorial comment on a presentation by a representative of an telecom lobbyist (no names here, look it up if you care). The presentation focused on the fact that the US is way behind other countries and that we’ll need up to 10Gbps per home in the near future. I made a comment that a Georgia governmental group tried to push broadband in rural areas and discovered that many people in rural areas don’t even own a computer or see any reason to get one – and perhaps the lobbying group should set smaller, intermediate goals. The speaker had a snide response that only retirement communities don’t have computers.

This is a serious problem. We in the telecom industry are insulated in our community, and the rest of the country doesn’t necessarily share our enthusiasm for broadband. I personally have spent a lot of time in small southern towns where computers are still not considered a necessary or even desirable home appliance. I don't believe that the south is unique in this (despite popular stereotypes). If we want to create the groundswell for broadband that is necessary for governmental action, we’re going to have to have a viable strategy.

Many municipal FTTH deployments have it right. They’re starting with broadband to schools to get the kids excited and educated about broadband. They are also putting in broadband to businesses to bring in development and demonstrate the benefit of broadband in the workplace. That is, in my opinion, the strategy that lobbying groups should be pushing.

The push for broadband in the US should be tied to education and development. Without a competitive broadband strategy, those are the areas where the US is going to start falling behind. Don’t make arguments based on gigabits and the developments in Korea. Legislators are, in general, not engineers. They are politicians who are looking out for their constituents (or at least their most powerful lobbyists). Make appeals that they can understand.

Hopefully the lobbyist that spoke was the exception rather than the rule. Presentations from SBC stating that 30Mbps to the home is sufficient forever should make all of us worry about the future of US competitiveness.

[Update] Lightreading has posted their views on the Forum in the articles FTTP Gets Plenty of Airtime and Components Competition is Killing. Both appear to be written with an eye towards generating discussion on their bulletin boards. As stated above, to get the real picture you'll have to pay to get in next time.

[Update 3/29] The slides from the Forum are now posted.

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