There's a Business Angle to Convergence, Too

Carl Weinschenk

You don't need an advanced degree from The Harvard Business School to understand that convergence augurs change to the very mission of vendors, service providers and carriers. The biggest questions are how dramatic the changes will be and the length of the pause between the technical and business transformations.


Put more simply, we ain't seen nothin' yet. This IT-Director commentary starts with that point -- technical convergence leads to an ongoing reshuffling of the existing business order -- and offers a potential evolutionary path. The writer thinks changes to the vendor community will be large-scale and fundamental, simply because Internet protocol (IP) is the basic building block of all the IT and telecommunications networks and applications that rest on it.


It's inevitable that a great many companies will be acquired, change drastically or just go away. The writer of the IT-Director piece sees a future in which companies specialize horizontally. Instead of focusing on health care, financial services or other industries, he envisions a world in which there are content companies, management, provisioning and fulfillment companies and bandwidth (or "bit pipes") companies that provide the raw carriage.


This seems like a solid prognostication. We're sure, as well, that there are other potential realignment paths. The point is that the convergence on IP and the resulting intermingling of wired voice, wireless voice, data and video creates a different and far less rigid landscape than that which existed a decade ago.


It's possible to see this already. The emergence of VoIP, for instance, has forced old line telephone companies to compete head-to-head with cable companies and VoIP-specific upstarts such as Vonage and Skype. Likewise, telephone and cable companies are slugging it out in the four-headed world of bundled services.


It's amazing that these companies are competing on so broad a playing field. The emergence of IP as a near universal internetworking protocol means that there are far fewer barriers than in the past.

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