Monday, May 07, 2007
Comcast calls out Kings Horses and Kings Men
Will Comcast put Humpty together again?
Om Malik, reports, golly gee whiz,
To bravely rebuild The Smart Pipe, Comcast will offer Zimbra email/voicemail to "all 12.5 million customers."
What don't I understand about this? If an application or service provider offered Zimbra enhanced email/voicemail, and it wasn't weighed down by its ties to a carrier, its addressable market would be 1,000 million customers. I know Bell-Headed thinking, so I suspect that Comcast is muddling towards its Zimbra offer, "to enhance the value of its cable plant." Well, if the Zimbra app is so durned valuable to 12.5 million customers, wouldn't it be 80 times more valuable if offered to 1,000 million customers?
Remember "synergy"? It was so much easier than thinking. If there's synergy here, what's the model?
Then Om writes:
Hewlett Packard is the vendor selling Comcast this bill of goods. Like Comcast, HP yearns for the day when the network was vertically integrated and the Commoditization* Monster was not singing the hair on the back of its neck. Maybe HP and Comcast think that if they behave *as if* Internet apps could be re-integrated with Internet access, then magically it will be so.
If I were a Comcast shareholder, I'd sell on this news. Or, at least, I'd insist that Comcast management read -- or re-read -- The Rise of the Stupid Network.
Meanwhile, Om, how about a bit more critical thinking? You can do it, I know you can. Don't go all White-House-Press-Corps on us!
Om Malik, reports, golly gee whiz,
"There is a growing realization on the part of carriers that companies like Yahoo and Google are the ones who have relationships with customers, and as a result have little or no loyalty to carriers. The prospect of being just a dumb pipe scares the carriers, so they are looking at current partnerships closely."Are the carriers just now getting the message?
To bravely rebuild The Smart Pipe, Comcast will offer Zimbra email/voicemail to "all 12.5 million customers."
What don't I understand about this? If an application or service provider offered Zimbra enhanced email/voicemail, and it wasn't weighed down by its ties to a carrier, its addressable market would be 1,000 million customers. I know Bell-Headed thinking, so I suspect that Comcast is muddling towards its Zimbra offer, "to enhance the value of its cable plant." Well, if the Zimbra app is so durned valuable to 12.5 million customers, wouldn't it be 80 times more valuable if offered to 1,000 million customers?
Remember "synergy"? It was so much easier than thinking. If there's synergy here, what's the model?
Then Om writes:
. . . it is not difficult to imagine that in the near future, you could add to your calendar your desire to watch an on-demand movie, say next Friday. And you can turn your TV on, the movie is ready for you to go. That, however, is in the future . . .What don't I understand about this? Why not watch an on-demand movie when you *want* to watch it? Oh, by the way, why (except for habit) do you need a special "cable" network to get video entertainment anymore? Got Vuze yet?
Hewlett Packard is the vendor selling Comcast this bill of goods. Like Comcast, HP yearns for the day when the network was vertically integrated and the Commoditization* Monster was not singing the hair on the back of its neck. Maybe HP and Comcast think that if they behave *as if* Internet apps could be re-integrated with Internet access, then magically it will be so.
If I were a Comcast shareholder, I'd sell on this news. Or, at least, I'd insist that Comcast management read -- or re-read -- The Rise of the Stupid Network.
Meanwhile, Om, how about a bit more critical thinking? You can do it, I know you can. Don't go all White-House-Press-Corps on us!
Technorati Tags: Comcast, IntelligentNetwork, OmMalik, Stupid Network, Stupidity
Comments:
absolutely...
Have any of these guys been on campus lately?
If they want to enhance the value of their network, they should make it lightning fast - upstream and downstream. no walled gardens
So many companies just don't get it..
Have any of these guys been on campus lately?
If they want to enhance the value of their network, they should make it lightning fast - upstream and downstream. no walled gardens
So many companies just don't get it..
Hey David -
I think you're missing the point here. The zimbra integrated email/voicemail announcement isn't about the network at all. Its fundamentally about leveraging and managing customer relationships.
I agree on one aspect - applications have indeed become unhinged from the access network - GrandCentral is a great example of an application provider adding value on top of a 'stupid' voip pipe provided by comcast or anyone else.
What you miss, however, is that customer relationships haven't come unhinged from their network provider. Why do you think cable now dominates voip despite the fact that they were late to market and charge $8 to $15 more per month for a similar service to Vonage?
Sure, if the application were offered solo the addressable market would be huge - but it is much, much harder for a 3rd party to harvest that and turn it into regular subscribers. It is much easier and less expensive (cable co's get free TV time, for example) for an operator to 'upgrade' an existing customer than it is for a 3rd party to form an entirely new customer relationship. Further, most customers want more simplicity in their lives = fewer, not more, provider relationships.
Easier often wins. Why get my HD video on Vuze when I can click my remote three times on my special cable network and watch yesterday's Soprano's episode in HD on my TV without getting off my lazy a**? Sure I can get greater variety online - but I just dont have the time/energy to do it...
So, step out of the technical realm and into the world of customer relationships and behavior - this isnt about re-integrating Internet Access and applications to 'enhance the value of the cable plant'. What Comcast is trying to do here is
1)reduce churn by trying to differentiate themselves from Verizon's triple play and the like; If I like this zimbra widget I might be less inclined to switch to verizon's offer.
2)Give people a reason to go to the Comcast portal - or as Om points out, a reason NOT to use Yahoo or Google. Regular portal users churn noticably less. Better email & portal = more regular users = less churn. Lower churn translates into higher profits very quickly.
3)Comcast has aspirations to grow their ad sales biz to $1 billion - they see an opportunity to generate more ad inventory and ad buyers today are looking for cross-platform media buys.
There. Done deal and the result is a new email widget. Smart or not, I guarantee you no one at Comcast even remotely thought about 'the network' when evaluating this project.
Fair Disclosure: I work in the cable industry, but not for Comcast.
David A Isenberg
David at theisenbergs dot com
Post a Comment
I think you're missing the point here. The zimbra integrated email/voicemail announcement isn't about the network at all. Its fundamentally about leveraging and managing customer relationships.
I agree on one aspect - applications have indeed become unhinged from the access network - GrandCentral is a great example of an application provider adding value on top of a 'stupid' voip pipe provided by comcast or anyone else.
What you miss, however, is that customer relationships haven't come unhinged from their network provider. Why do you think cable now dominates voip despite the fact that they were late to market and charge $8 to $15 more per month for a similar service to Vonage?
Sure, if the application were offered solo the addressable market would be huge - but it is much, much harder for a 3rd party to harvest that and turn it into regular subscribers. It is much easier and less expensive (cable co's get free TV time, for example) for an operator to 'upgrade' an existing customer than it is for a 3rd party to form an entirely new customer relationship. Further, most customers want more simplicity in their lives = fewer, not more, provider relationships.
Easier often wins. Why get my HD video on Vuze when I can click my remote three times on my special cable network and watch yesterday's Soprano's episode in HD on my TV without getting off my lazy a**? Sure I can get greater variety online - but I just dont have the time/energy to do it...
So, step out of the technical realm and into the world of customer relationships and behavior - this isnt about re-integrating Internet Access and applications to 'enhance the value of the cable plant'. What Comcast is trying to do here is
1)reduce churn by trying to differentiate themselves from Verizon's triple play and the like; If I like this zimbra widget I might be less inclined to switch to verizon's offer.
2)Give people a reason to go to the Comcast portal - or as Om points out, a reason NOT to use Yahoo or Google. Regular portal users churn noticably less. Better email & portal = more regular users = less churn. Lower churn translates into higher profits very quickly.
3)Comcast has aspirations to grow their ad sales biz to $1 billion - they see an opportunity to generate more ad inventory and ad buyers today are looking for cross-platform media buys.
There. Done deal and the result is a new email widget. Smart or not, I guarantee you no one at Comcast even remotely thought about 'the network' when evaluating this project.
Fair Disclosure: I work in the cable industry, but not for Comcast.
David A Isenberg
David at theisenbergs dot com
# posted by 
: 5/08/2007 10:24 PM
: 5/08/2007 10:24 PM
