I recently saw a great special on the Discovery Channel (www.discovery.com)
entitled Walking With Prehistoric Beasts that detailed the time in
history from the end of the Dinosaur age until the present day. The program
amazed me with its special effects, and the animation that was needed to
create a world that existed long before any recording devices was superb. Of
course not having been around five million years ago, I can only assume that
the animals looked realistic, but I leave such matters of accuracy to the
paleontologists and anthropologists who were no doubt in close consultation
throughout the making of the Discovery Channel special.
The underlying theme of the three-hour special is that species adapt to
their surroundings. As new species emerge, all living things must respond to
the pressure of their ever-changing environment as it evolves. The
environment shapes the landscape for the success of creatures that are able
to genetically transform so that they remain compatible with changing
environments. The cycle repeats infinitely.
One aspect of life in the past 65 million years that I found incredibly
interesting was the portrayal of Neanderthals as a very robust group that
had strong bones, used tools, and seemed purpose built for their
environment. According to the program, Neanderthal man perished due to an
inability to change whereas Homo sapiens flourished in a changing
environment. Even though their brain cavities were smaller than Neanderthals
and even though they were relatively fragile compared to Neanderthals, it
seems Homo sapiens greatest strength was in their adaptability.
The subject of Walking With Prehistoric Beasts came up recently in
a staff meeting regarding the future of the communications market. It seems
this discussion presented some parallels to what is happening to the
landscape of our current Internet telephony market. Regardless of whether
you think that there is a huge opportunity for CLECs (I still do) one must
accept that something akin to a virtual meteor has hit the globe of the
capital markets.
Many CLECs now risk extinction (many more have already vanished) just as
the dinosaurs did and to some degree, for many of the same reasons.
Dinosaurs had become tremendous due to the competitive pressures of daily
life. Once the environment changed, and was unable to provide adequate food,
it spelled disaster for such colossal beasts. Many CLECs (as well as some
who provided equipment to them) in turn spent time growing and growing and
when the capital markets became difficult or downright impossible (unable to
provide sustenance), the CLECs began to starve. Granted, hindsight is 20/20,
but why many of these CLECs didnt focus on a single region, generating as
much revenue from a single county as possible before expanding, is beyond
me. It was the dotcom syndrome of growth with no profit that warped
the minds of once intelligent businessmen. And inasmuch as VCs were
rewarding them for rapid expansion (at any cost), they too should shoulder
some of the blame.
Regardless, we are where we are and there are fewer CLECs than we
expected there would be. Yet there are still lots and lots of companies
(large and small) vying to supply equipment to this reduced pool of service
providers. Note to those companies relying exclusively on service providers
as a channel for their products: You must adapt and find new revenue
sources. Now.
And heres some more free advice: Based on my 20 years of experience in
this industry, I can tell you that what you should not do is focus
exclusively on ILECs. With sales cycles stretching as long as four years,
these providers will bankrupt you before they seriously deploy anything. The
incumbents dont do anything quickly unless they have to. And even then,
you should double or triple any estimated time of deployment they quote you.
So what is left? The enterprise of course! Those companies that have put
both feet planted firmly in the service provider market will have to lift
one foot up and put it toe-first in to the corporate space. The migration is
inevitable. In fact its already underway. As service providers continue
to slough their way through excess inventories, the enterprise market is
primed for recovery.
As far as I am concerned, the enterprise market is the place to be. Im
faithful to the idea that the service provider market will come back strong
in the next few years, but for the moment, today, right now, the money is in
the enterprise. And, anyone with plans to provide solutions exclusively to
service providers had better respond and respond quickly if they want to
avoid being featured on a program called Walking With Prehistoric Service
Provider Equipment Vendors.
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