1. Emerging telecom industry lanscape Has the 96 Act failed? –Confused political assurances w/ economic motivations –Misunderstood difficulty, thus lacked enforcement mechanisms –Oversold short-term benefits The RBOC's revenge: Re-emergence of large, vertically integrated telcos local / long-distance / business networks Wireless Verizon Wireless - 26.3 m Cingular Wireless - 19 m (SBC + BellSouth) AT&T Wireless - 15 m Sprint PCS - 9.2 m Nextel Communications - 6.2 million. Fiber troubles Residential access: 75% BB availability, 11% take-up WiFi surprise? Next wave of consolidation

2. What Telecom Bust? Two distinct events –Dot-com bust –Telecom collapse Not demand nor technology bust (over) supply bust - 1990's investment –New entrants –Economics of fiber supply "Technology successfully met the challenge posed by unrealistic business plans that were formulated in willful disregard of real demand." (A. Odlyzko)

7. Internet (1990s)Wireless today Industry structure'free' bandwidth Low entry barriers Licensed bandwidth Large entry costs RegulationOpen carrier network Unregulated services Spectrum allocation Entry (licensing) Standards and architecture Uniform / open Compete on implementation End-to-end Compete on standards Fragmented networks and platforms 'Intelligent' network DevicesPCs as universal standard appliance Device proliferation ApplicationsInvented by end-usersPushed by providers (voice, SMS today; future unclear) Lead UsersMilitary, research Commercial Mass medium US: professional EU/Japan: consumer

8. Internet (1990s)Wireless today Industry structure'free' bandwidth Low entry barriers Licensed bandwidth Large entry costs RegulationOpen carrier network Unregulated services Spectrum allocation Entry (licensing) Standards and architecture Uniform / open Compete on implementation End-to-end Compete on standards Fragmented networks and platforms 'Intelligent' network DevicesPCs as universal standard appliance Device proliferation ApplicationsInvented by end-usersPushed by providers (voice, SMS today; future unclear) Lead UsersMilitary, research Commercial Mass medium US: professional EU/Japan: consumer

9. Infrastructure 90’s internet: "free" bandwidth (from the open phone network) Today: bifurcated situation: –Long-haul and CLECs crisis –Local: still holding What comes next? –Re-verticalization –Competitive bankruptcy –"Let them fail fast" Challenge: incentives for infrastructure investment

10. Standards & Architecture 90’s internet –Open standards (compete on implementation) –End-to-end architecture Next-Generation –Standards wars? –Limits to E2E: strategic incentives Challenge: incentives for open / end-to-end?

11. Lead users / leading applications 90’s internet –expanding communities military, research, education, mass-medium –users (individual / corporate) invent the applications –Productivity: network-based re-organization of work Next-Generation –User-led innovation requires user control –Closed networks / fragmented user communities Challenge: sustaining user-driven innovation

12. "Consolidation, Integration & Network Control" Some fundamental choices Consolidated Infrastructure… or 'fibersphere' Integrated network… or open architecture Supplier control… or user-driven change