For several years, cable operators have enjoyed plucking customers away from phone companies as they attempt to become traditional telcos. Now, the table is about to turn on them. As the pressure from the two big telcos begins to mount, guess what? The cable operators don’t have any significant means of counter attack.

Guess who wins here? It’s the consumer. Yes, you and I will reap the benefits of true competition: bigger networks, faster connections, more options — all at lower prices. These and many other interesting stories can be found in this week’s issue of The Dial Tone.

General news

Business activity in our sector continues to drop at an alarming rate for many telecom suppliers. Of course, exceptions happen, but this time, the effects of the changes being implemented by these very large corporations will create a major chill in our industry that will be felt for many years.

In the next six months, don’t be alarmed when you hear of companies that change hands or disappear from the landscape altogether. I hear so many stories of dying business models about to disappear. No one is immune from this current business cycle. And yes, some of you are doing well or, holding your own. However, very few businesses are growing, a fact that can’t be altered now.

The general business dynamics have changed drastically in the past eight months, and we are not at the end of this cycle. Most of what I wrote about last year has been turned on its head, and the principles I followed are no longer valid.

A drastic reduction in the supply chain is happening, in both OEM and VAR distributors. Surviving will have more to do with luck than expertise. One thing I am certain of is that this trend will displace much talent. Many people will move to other industries, adding again to the loss of talent in our sector. This loss of overall talent will shape our industry’s future.

The businesses that will ultimately miss this most are the large telcos that have depended on their vast supply chain to help them serve customers. Then again, these same large telcos are abandoning their supply chain in lieu of going at it alone.

We have come full circle! Can any of you remember how we did business prior to 1984?

To all the readers of The Dial Tone for the past five-plus years, thank you. It was a pleasure publishing this newsletter, and I hope that someday I may begin again …

… Goodbye for now and good luck to all of you.

Peter Rodriguez