Friday, June 12, 2009
It's Official: Value Moving to Edge
It's official. A team of market analysts from Oppenheimer are saying (.pdf) what I've been saying since 1997, that the apps are separating from the network, and this is driving a wave of "explosive innovation." The team, which includes my friend Tim Horan, says
The Oppenheimer team thinks the winners will be backhaul providers, towercos and data centers -- in other words, infrastructure providers. The losers; anybody that depends on integration of infrastructure and app.
I had it right in 1997, but my timing was off. If you believe the Oppenheimer team, the time for wireless dis-integration is now.
". . . the latest smartphones (Pre, Bold, iPhone) show that wireless applications can be separated from the underlying network. Indeed, apps must be provided separately to allow the explosive innovation required to grow as well as take advantage of global economies of scale. Applications and hardware are global, with future expense elasticity being driven primarily by their adoption in markets such as China and India, rather than the U.S. This could potentially cannibalize voice and text messaging with applications for which the service providers receive little revenues (e.g., instant messaging, Skype, Fring, Truphone and Nimbuzz are all VoIP applications now available wirelessly). The obvious conflict this creates between the service providers and the application/hardware providers will be the most important dynamic the industry will face.The carriers need to face the fact that just because something is unthinkable doesn't mean it's not going to happen. Today mobile phones. Tomorrow cable TV.
The Oppenheimer team thinks the winners will be backhaul providers, towercos and data centers -- in other words, infrastructure providers. The losers; anybody that depends on integration of infrastructure and app.
I had it right in 1997, but my timing was off. If you believe the Oppenheimer team, the time for wireless dis-integration is now.
Technorati Tags: ClayShirky, Infrastructure, TimHoran, Stupid Network, WirelessNetworks
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