TC2's David Rohde on Telecom

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The Uncarrier vs. Employee Discounts: The PR Fail that reveals much

By David Rohde Posted April 2, 2014

Good news! T-Mobile is ending selective employee discounts on corporate mobile plans to concentrate on giving everyone a fair shake!

Wait, strike that. Take 2:

Good news! T-Mobile is NOT ending employee discounts on existing corporate mobile contracts, so stop worrying about it!

Let’s unravel this. I get that companies make mistakes, but both of these developments were teed up this week by T-Mobile as enormous positives. That makes no sense.

On Monday T-Mobile CEO & Head Comedy Writer John Legere claimed that ending employee discounts – by which he meant individual liable units in corporate contracts – would end the nefarious practice of using “employees as bargaining chips” to deprive ALL corporate customers of good deals. If we just label this as “spin” (which is very charitable), then why did a tweet today from CMO Mike Sievert taking back Legere’s move for existing contracts label the reversal “good news”?

Is all news good news no matter what it is, provided it’s from T-Mobile? I think this episode reveals some real underlying problems with what T-Mobile is trying to accomplish with its “Uncarrier” initiative and, frankly, where their head is at when it comes to the enterprise.

First, there’s the very notion of a “discount.” T-Mobile’s trial balloons here serve up “discounts” as something like a goodie or a favor to the little people, sort of like an AARP or AAA discount at an EconoLodge. That’s ridiculous. In telecom a “discount” is the only thing that makes prices even remotely rational! List prices are simply inane – granted historically more in wireline but now, also, in wireless – and “discount” is a necessary mechanism to get to anything like a market price.

Second, there’s the initial disregard in Legere’s opening gambit for the very notion of a contract. Carriers are forever claiming that they need multi-year commitments to give you any kind of concession. It’s bad enough that Legere’s initial foray into ending unfair employee “discounts” completely ignored his carrier’s, or any carrier’s, commitments to honor not only discounts but also all other terms and conditions in an existing deal. But my God, this is the wireless industry, where even consumers, not just corporations, are constantly being asked to sign 2-year contracts. Where’s the commitment, guys?

Third, and perhaps most important, is what this says about the Uncarrier’s Unprofits. Not even the most credulous analyst on Wall Street was fooled by Legere’s initial move. Whether for all contracts or “just” new ones, the purpose of ending ILU discounts is obviously to shore up the fact that T-Mobile is losing money.

Paired with what has become a continuous lobbying campaign by Softbank to boost its moral image, track record, and promises of telecom paradise in the U.S. – with language taken straight from successful purveyors of past mega-merger PR and lobbying advice – it’s clear that T-Mobile has been principally aiming to boost its subscriber numbers in preparation for possible industry consolidation and a good sellout deal for its principal owner, Deutsche Telekom.

This week’s “discount” crack-up is probably an indication of a time limit – let’s call it calendar year 2014 – for this major transaction to take place lest an independent T-Mobile fall out of viability. T-Mo can’t just sit around losing money waiting for the U.S. industry consolidation that is now Softbank CEO Masayoshi Son’s full-time obsession, following his acquisition of the carrier that is “only” No. 3, Sprint.

Let’s hope T-Mobile can get its mojo back at least in the way it communicates to the world at large. It’s bad enough that it thinks it can say that corporate employees are “bargaining chips” (which is close to saying that it couldn’t care less about the enterprise business). What’s more important is what the endgame is here. If all this reveals that in fact neither Sprint nor T-Mobile have a problem coming together sometime this year – and may in fact be relieved to do so, provided they can convince regulators that it’s not a terrible idea – then this week’s latest comedy act from T-Mobile may have been worth it in terms of clarity about the future of the industry.

Masayoshi Son piles up the straw men in his pitch for merger

By David Rohde Posted March 12, 2014

You people in the United States don’t know what you’re doing, and I’m here to help you.

That was the essence of a Washington media blitz by Softbank CEO Masayoshi Son on Monday and Tuesday arguing for Sprint’s right to buy T-Mobile’s U.S. operations. Mr. Son promised a price war IF Sprint and T-Mobile get to merge.

Excuse me, but isn’t there something of a price war going on right now initiated by the UN-merged T-Mobile?

In order to get past this obvious disconnect, Son combined his well-known (in Japan) combativeness with what I clearly recognize as slick Washington lobbying phrases he was coached to say. Added all up they amount to a pile of straw-man arguments – cheap distractions or caricatures of arguments against carrier consolidation. Among Mr. Son’s talking points:

The U.S. is way behind in wireless speed and should ramp up to 200 meg. I repeat: 200 megabits per second to a handheld device. That’s faster than OC-3! This precious video featuring CNBC’s highly respected David Faber shows Faber’s astonishment at the need for Son to be discussing this futuristic vision when Softbank’s own property, Sprint, has enough problems delivering today’s broadband mobile applications.

Wireline broadband is no good and needs to be replaced. That’s rich coming from the one member of the now-meaningless “Big 3” group of U.S. telecom carriers that never did anything about bringing fiber to the home or business premise. It’s especially ironic given that Comcast and Time Warner Cable’s proposal to merge brings together two companies that, however imperfectly so far, have been gunning to sell broadband connections to businesses at much lower prices than traditional telecom carriers. Are Softbank and Sprint saying that if only they get to buy T-Mobile then suddenly all the enterprises that want to ditch their T-1s in favor of 10M Ethernet access will have a great new source for that – wirelessly? So far almost every effort Sprint has made to provide fixed wireless access has crashed and burned while XO, TW Telecom, and cablecos have stolen a march on the business Ethernet broadband market instead.

There’s a “Digital Divide” in America. Oh come on, Mr. Son, you can do better than that. Everybody who lives inside the Beltway as I do knows that this is the way that IT and telecom companies talk when 1) they want something and 2) the Democrats are in power. When the Republicans are in power the same companies use phrases like “unleash the power of the free market” even though they’re advocating the exact same preferred policy that the decidedly non-laissez-faire “close the digital divide” argument is also magically supposed to support. Mr. Son apparently was astonished at the size of the house of one of the Washington lobbyists that Softbank hired. For the amount of money he must be paying this guy’s lobbying firm, surely they could have come up with a less cliché talking point than the “digital divide.”

Japan and South Korea have more comprehensive broadband wireless coverage than America. Of course they do. Their average population density is roughly 100 times that of the United States. The U.S. has many telecommunications challenges in both the wireline and wireless arena, but cheap comparisons of countries vs. the U.S. almost always have flaws given America’s tremendous diversity in geography, population, culture and in many other ways.

Wireless prices in the U.S. are rising, unlike almost everywhere else. Bingo, Mr. Son! So now explain how merging Sprint and T-Mobile solves that problem instead of exacerbates it. That’s what’s lacking in this whole strategic approach.

The bit about “IF we get to do this one more merger THEN we can do fabulous things” is a golden oldie in the telecom industry. It was present in every RBOC merger that the old “SBC” (as in Southwestern Bell Corporation, not Session Border Controller) sold to the FCC before SBC finally bought the legacy long-distance AT&T and took its name. And it was the premise of AT&T’s 2011 proposal to buy T-Mobile. Imagine if the government had fell for that one! Do you think AT&T would be the “Uncarrier” price innovator today?

Let me soften up a bit here and say that in fact it’s a reasonable question whether the U.S. really ultimately needs four national wireline carriers as opposed to three strong ones. The stratification of today’s U.S. telecom industry between two superpowers and two also-rans – Sprint because of its repeated mistakes over the last few years, and T-Mobile because of its continuing status as not-quite-present in large enterprise and, frankly, low network scores despite John Legere’s whiny protests – gives the lie to the idea that four is automatically better than three.

Our longstanding experience at TC2 and LB3 in any telecom market is that the competitive credibility of a prospective No. 3 bidder for services on the table right now is almost always the key to the most vibrant possible procurement environment.

The problem is that it’s well known that Son has no interest in being any kind of No. 3 – Softbank and Son really want to be No. 1 everywhere they go in the world. If so, perhaps buying Sprint with no real interest in just improving its operations right now other than screaming at Sprint personnel and instead pursuing a pipe dream of being the new AT&T and Verizon by steamrolling U.S. regulators and somewhere getting the resources to massively build out the North American continent – despite having reserved only $5 billion of the $21 billion in the Sprint takeover itself for new capital expenditures – is close to the area of unreality.

If 2014 at Sprint/Softbank is chewed up by Masayoshi Son believing he can magically pitch U.S. regulators on what they clearly do not want to do – authorize a takeover of the scrappiest carrier in the country – then it may be one more wasted year in getting Sprint back to where it once was and no longer has a chance to be in wireline anyway, the highly valued No. 3 player that keeps everything ultra-competitive. I’d rate Mr. Son’s initial Washington tour as ineffective and troubling. Fixing Sprint’s own problems, calmly and methodically, might be better for everyone all around, but perhaps Mr. Son is not the right person for that task.

AT&T keeps its eye trained on Vodafone as global merger activity looms

By David Rohde Posted March 6, 2014

Sprint’s palpable interest in buying T-Mobile, despite John Legere’s mock insults and Deutsche Telekom’s claimed lack of interest in selling, isn’t the only potential 2014 Giant Telecom Merger that won’t go away. The other one is AT&T and Vodafone.

Wait, what? Didn’t Vodafone just cash out of the U.S. market? Yes, but AT&T certainly hasn’t cashed out of the global market. To the contrary, AT&T sees a spectacular opportunity with U.S. and European multinationals now that Verizon is tied down with $115 billion in debt and can’t realistically make an international acquisition.

And the beneficiary of all that Verizon debt-raising – Vodafone – is also the repository of the single biggest collection of telecom networks eyed by AT&T around the world.

Apparently AT&T CEO Randall Stephenson and Sprint Chairman / Softbank CEO Masayoshi Son come from the same school of “I Know What I Want And Dammit I’m Gonna Get It.” (Stephenson’s Texas-based predecessors as CEOs of the sharp-elbowed RBOC “SBC” – that’s SBC as in Southwestern Bell Corporation, not Session Border Controller – attended the same school and now have the AT&T name and enterprise customers to show for it.)

Stephenson’s all-but-declared first run at Vodafone in 2013 ran aground over the U.S. National Security Agency spying scandal. Vodafone may be based in the U.K., but among other things it’s Germany’s No. 2 wireless carrier. Surprisingly, the Germans did not find any of the U.S. telecom carriers’ purported participation in alleged snooping on their government officials quite as funny as a John Legere stand-up routine about wireless pricing plans. (Or, presumably, as funny as some of the ex-employee protest websites that popped up following the Legere-run Global Crossing’s 2002 bankruptcy filing, with names like globaldoublecrossing.com.)

But time heals all wounds, and a clear sign of AT&T’s renewed interest in Vodafone can be seen in some influence it’s trying to exert of Vodafone’s decision-making right now. Last week the Wall Street Journal reported that AT&T is unhappy over Vodafone’s plans to buy cable networks in several European countries, because AT&T would prefer that Vodafone motor ahead in the wireless arena instead.

The problem is that Verizon’s $130 billion payoff – even after a gargantuan $85 billion distribution to Vodafone’s shareholders, mostly in the U.K. – is burning a hole in Vodafone CEO Vittorio Colao’s pocket. Colao himself wants to “transform” Vodafone, which requires big acquisitions of his own. In individual markets like Spain, that’s thought to require both wireline and wireless assets. The Journal reported that Stephenson told AT&T’s own institutional investors that he could understand Vodafone’s strategy if it remained an independent company, but as a global behemoth, a merged AT&T and Vodafone would not find much benefit in a legacy operation like a domestic European cable company.

Where this potentially leaves multinational enterprise customers is an interesting dilemma. Nobody doubts that the entire world is moving in a broadband wireless direction, but enterprises’ classic global challenge for 20 years has been and remains core wireline global WANs. Indeed, Vodafone’s moves toward wireline networks in India and elsewhere plus its 2012 acquisition of Cable & Wireless’ international network has been of keen interest to us in recent years.

But a huge industry factor here is every carrier’s newly intense desire for postpaid (i.e. subscriber) wireless subscriber revenue anywhere they can get it – the very factor that drove Softbank toward a fairly weak No. 3 carrier in Sprint and that drove Verizon to pay an astonishing sum just to get Vodafone’s hands off of 45% of its wireless subscriber dollars. Against that critical priority the precise needs of any given multinational for a global carrier probably takes a back seat. Almost certainly that’s Stephenson’s No. 1 thought in keeping his eyes trained on Vodafone.

To be sure, newly important enterprise management questions around global roaming, BYOD, cross-border mobile functionality, and mobile device management all could benefit from a gigantic AT&T push forward in global mobile – after the usual post-merger operational chaos, of course. What’s best to keep in mind is that what’s gotten the Dallas-based U.S. behemoth now called AT&T this far – intense focus and stubbornness in both regulatory affairs and acquisitions – persists to this day. Do not be surprised to find AT&T back in the big acquisition headlines this year, and very likely on the biggest stage of all – the entire world.

The Uncarrier’s Unprofits and the path to industry consolidation

By David Rohde Posted March 5, 2014

Didja hear the one where T-Mobile tells wireless subscribers to #SprintLikeHell? T-Mobile CEO John Legere, famous for trashing Verizon and crashing AT&T’s parties, has a few yuks saved up for the No. 3 wireless carrier. Former Sprint customers – which are not that hard to find – are rewarded for switching to T-Mobile with some funny hats, goofy pictures and a cutesy hashtag on Twitter.

Hey, why not? Legere didn’t spare Sprint from his comedy routine when he barreled out of the gate at the beginning of the year at the Consumer Electronics Show. “Sprint is a pile of spectrum waiting to be turned into a capability,” Legere wittily observed.

He also called Sprint’s network “completely horrible” (which, given T-Mobile’s third-place finish well behind Verizon and AT&T in the just-released 2014 RootMetrics study, makes T-Mobile, what, “not completely horrible”?) and said that Sprint consists of “people in lab coats talking about what’s going to happen when my daughter is President of the United States.”

Legere then leaked that Sprint for some reason is thinking of bringing back the Nextel name, and added that Sprint’s motto seems to be “Pardon our dust while we redecorate.” Stop it, John, you’re killing me here.

Well, here’s one thing that might actually stop John Legere: red ink. The Uncarrier, which has unquestionably cajoled, dealed, or joked its way back into the conversation, also has no profits to show for it. The carrier lost $20 million in the fourth quarter of 2013 even as it added 1.65 million net new customers in the otherwise fabulously profitable U.S. wireless industry.

And you know what, Sprint seems remarkably unfazed by Legere’s insults. Sprint Chairman Masayoshi Son of Softbank, who has been privately arguing for U.S. industry consolidation and basically gotten no for an answer in meetings with U.S. government officials, has now scheduled a public campaign in favor of what could be an offer to buy T-Mobile. Step 1 is a March 11 speech in Washington before the U.S. Chamber of Commerce. Son is not known for his improv talents and yet suddenly has some similar rhetoric to Legere, swapping “horrible” for “terrible.” Of course he doesn’t mean Sprint itself. What he means is, “Every time I make a business trip to the U.S., I am reminded how terrible connections are there.”

Hmmm, well since the last thing that Softbank and Mr. Son did when they wanted to enter the U.S. market was #SprintLikeHell, one wonders what exactly John Legere was hired to do as CEO of T-Mobile’s U.S. unit and why Legere – despite calling out Sprint for a few hardy-har-hars – has also actually had positive things to say about U.S. wireless consolidation.

The reality is that mobile subscribers are expensive to acquire – by some estimates $1,000 apiece given retail space, wall-to-wall advertising, equipment subsidies, net losses to other carriers, and increasingly generous upgrade programs. At 37.3 million branded T-Mobile subscribers folded under its tent, that would be quite a prize for Sprint even if the balance sheet they take over in the process yields no earnings right now. Besides, pricing plans can always be changed, can’t they?

For enterprises still waiting to see whether T-Mobile’s moves and John Legere’s antics can really knock Verizon off its post-Vodafone high horse, it would be a shame if all this Uncarrier business was ever about was a ruse to build up T-Mobile’s numbers in preparation for a sale to the perennially struggling Sprint. Interestingly, Deutsche Telekom’s CEO says a sale of T-Mobile US, of which it still owns 67%, is “unlikely soon,” although that may simply be a truism given U.S. regulatory approval timelines. In any case, the public lobbying for what is obviously some sort of deal is about to begin.

Like the 2011 AT&T/T-Mobile saga, which featured such knee-slappers as AT&T’s claim that the merger would increase employment (in contrast to every other merger in recorded history), we appear to be in for a lively mix of public cajoling and private hardball negotiations. Let the hilarity ensue! Maybe Mr. Son can be John Legere’s straight man.

Free of “stovepipes,” Verizon empire-building could be a blessing or a curse

By David Rohde Posted February 25, 2014

A hundred and one years ago Gertrude Stein said “a rose is a rose is a rose.” Not until last Friday could the nation’s No. 2 carrier finally say, “Verizon is Verizon is Verizon.”

It took sending $130 billion across the Atlantic Ocean to accomplish, but Verizon Wireless at last said good-bye to Vodafone and its 45% ownership in the wireless carrier. That left Verizon with full control over everything in the telecom industry that starts with the letter “V” and carries that slashy logo.

Or wait a minute – does this now make Verizon the No. 1 carrier in the U.S.? After all, Verizon is the front-runner in U.S. wireless. And for all anyone outside of the enterprise market knows or cares, wireless telecommunications is the telecommunications business.

So when Verizon CEO Lowell McAdam emailed Verizon employees that with the full takeover of the wireless house, Verizon will make changes ending “separate businesses” and “stovepipes,” that clearly was a signal that he wants Verizon Wireless’ top dog standing to transfer to the entire company.

On the surface, it certainly sounds cool and trendy for a business to work hard to defeat internal “silos” and “stovepipes.” But is that really a good thing or a bad thing for Verizon’s customers? Let’s examine this.

Verizon has actually been collapsing enterprise accounts as between their wireline and wireless components for some time. The problem is that the glamour part of the business is Verizon Wireless, and it’s that side of the house that’s been gaining power. And Verizon Wireless doesn’t necessarily view “competition” in the optimum way for enterprise accounts as a whole.

Verizon Wireless is habitually gunning for the high-value end-user and (in its own mind) leaving the dregs of end-users to everyone else. And because McAdam’s own background is in wireless, one wonders how much he perceives the large qualitative difference that still remains between enterprise wireline and wireless. An individual end-user may get to choose his or her own device under BYOD, but not her or her own 10M Ethernet access circuit from the office. And yes, 10M Ethernet is likely to be the new table stakes displacing the T-1 soon – remember businesses locations’ increasing intolerance for getting less bandwidth at work than their employees get at home.

Very hungry competitors, from cable companies to mid-level players like XO and TW Telecom, will pounce at the slightest hesitation by either Verizon or AT&T to play ball on major wireline contracts. And as AT&T continues to make bear-hug offers to large enterprises combining local, wireline, wireless, and managed value-added services, Verizon can’t assume that its own new freedom to make comprehensive bear-hug offers (because it no longer has to carve out specific profits for a minority shareholder) will land them the deal if that deal is no good on either the wireline or wireless side of the house.

As a result, Verizon’s promise to take down “stovepipes” and “silos” could either be a vehicle for it to make comprehensive smoking offers to major enterprises without the overhang of the Vodafone ownership to prevent these consolidated contracts – or a threat to deprive flexibility and independent power from the key wireline part of its business. That can only be countered with multiple competing offers in competitive procurements to show Verizon who’s boss.

Since we’re now in an era of IP Transformation projects, competitive procurements are at the apex of an opportunity for many users. Start tracking closely the behavior of any and all account relationships you have with Verizon. Have your radar out to take “haughtiness” readings of Verizon account control, especially if enterprise wireline offers start taking on the “We’re No. 1, we don’t have to try very hard” aura that many business customers pick up from Verizon Wireless. As the walls of Verizon’s silos start coming down, you don’t want them to crash onto the competitiveness of the pricing or business terms and conditions of any of your Verizon deals. The beginning of the Vodafone-free Verizon U.S. domestic empire is here. It’s going to be an important story to watch.

SIP Trunking is driving users’ ability to consolidate vendors in Europe

By Ben Fox Posted February 19, 2014

The following is a guest post by TC2 managing director Ben Fox.

Enterprises with multiple locations spread across Europe commonly purchase traditional fixed voice transport services (i.e. voice circuits, usage and DID/DDI services) from a range of local PTTs and in-country vendors. Even though a number of vendors exist that can offer such services across most countries in Europe, it is quite rare for enterprises to have consolidated these voice transport services with one vendor (or even a couple of vendors). And even when a single vendor has been engaged across Europe, the local PTTs still tend to linger on, e.g. keeping DDI services and local exchange lines.

Strategically procuring voice transport services across Europe drives significant cost savings, not least because in-country PTTs are almost always the most expensive vendor option. But various barriers and hurdles have historically discouraged pan-European vendor consolidation and strategic sourcing in this area:

  • Obtaining the existing spend, pricing, contract and volume/inventory data tends to be an arduous task across so many incumbent vendors.
  • Budgets for voice transport services are often held locally, so decisions are typically made locally too.
  • Awareness of the total spend is often limited (not least where it’s spread over a large number of vendors), and thus the services often fall below the radar of cost reduction initiatives.
  • Voice transport services typically have lower management visibility than core data network and mobility services.
  • Services and spend are sometimes combined with other in-country services, such as mobile, and thus awkward to de-couple and extract.
  • Incumbent PTT vendors often have pricing/contract arrangements that make it hard to move away without incurring additional costs. These include auto-renewing contracts, prices that increase as volumes decrease, and discounts that can be “clawed back” if spend commitments are not met.

However, SIP Trunking is now a key force in overcoming these barriers. A centralized SIP Trunking architecture that consolidates all European PSTN access (ingress and egress) at your primary data centers forces vendor consolidation and reduces individual in-country PTTs to providing limited local site services (e.g. exchange lines for calling emergency services or out-of-band access to network devices).

Vendors’ coverage is continuously growing and the larger European and global SIP Trunking vendors can migrate your voice services (including in-country DDI numbers) to their network for most major European countries and support the majority of your voice transport needs.

This delivers a double dose of cost savings – not only the transformational savings from decommissioning expensive local site voice trunks and replacing them with consolidated access at your data centers, but also the reduced outbound calling rates via the SIP Trunks that will be far lower that the in-country PTT voice rates that they displace.

Enterprises are implementing SIP Trunking for various reasons, including technical benefits such as improved resilience and redundancy, as well as the widely documented cost savings. But an additional long-term benefit in Europe is the improved negotiation leverage that centralized SIP Trunking provides. Once your voice services are consolidated with one or two vendors at your data centers, rather than distributed across numerous sites, vendors and countries, the complexity of changing vendor(s) in the future is considerably reduced. The flexibility this offers, and the increased ability to take advantage of competition for voice services, means that you will be reaping the rewards of the SIP Trunking migration and vendor consolidation for many years to come.

Big cable merger, seen through prism of Ethernet access, may be compelling

By David Rohde Posted February 13, 2014

Today’s major business headline is that Comcast is buying Time Warner Cable. If I change the headline, fully accurately, to “Nation’s Wealthiest Media Company Buys Fifth-Leading U.S. Ethernet Access Provider,” you’d get a better idea of the impact on enterprise telecommunications.

Your view of what the cable companies can and can’t do in competitive enterprise procurements may depend on your vertical industry and procurement philosophy. Cable companies have developed tremendous generic interest in serving the business data communications market, partly because their last-mile footprints are no longer confined to residential areas. It’s also because the historic “cable TV” market has sunk into a morass of concerns over programming fees, demographic shifts in entertainment options, and worries over technology substitution (not least Verizon’s LTE marketing machine promising broadband multimedia mobility over any device). So the cablecos are looking for new revenue sources.

At the same time cable companies have shown less than no interest in finding out how to compete in geographic areas that aren’t their own last-mile bastion, inhibiting clean national bids. If you permit balkanization of your ordering authority, or have an unusually broad distribution chain such as a franchise system, you almost certainly know of the cable companies encroaching on the telecom carriers with high-speed Internet offers to your partner companies or individual locations. If you don’t, you may not – unless you also solicit national bids via carriers like MegaPath that aggregate underlying physical carriers where they can best find them.

And that’s where the combination of Comcast and TW Cable is more compelling than other merger scenarios would be. Of all the possible combinations in the consolidating “cable TV” industry, this is the one that could most make a difference in telecom managers’ lives.

TWC is the most business-market-focused of all the cablecos, having just placed first among cablecos – and fifth among all providers – in Vertical Systems Group’s yearend 2013 Ethernet Leaderboard. Up until recently, TWC had been eyed as a takeover candidate by lesser cable companies such as Charter Communications, which would have drowned the combined companies in debt and involved them in a likely management soap opera over the colorful personalities that surround Charter. But Comcast is a bigger, more stolid purchaser and well capable of paying the $45 billion acquisition price. And Comcast itself has expressed keen interest in certain enterprise accounts and in learning the large business market.

There are so many other factors here that even the cliché “caveats abound” doesn’t capture it. Even together, Comcast and TWC cover about a third of the country, leaving a combined company with a task of still exploring how to make national bids. They still might have to divest some territories to a Charter or other player to get regulatory approval for the merger. Scalability and account management are always enterprise concerns, and Comcast is not exactly known for spectacular customer service at the individual cable subscriber level.

And while the loser Charter is considered somewhat dodgy, the winner Comcast has its own distraction in that it happens to own NBC. So Comcast’s top executives may still go to bed worrying a lot more about Olympic ratings than your MPLS network.

Of course if you peek a little higher in the Ethernet Leaderboard, you can see a familiar-looking company in third place behind AT&T and Verizon – TW Telecom, a long-ago spinoff of Time Warner Cable that is now a mature telecom carrier that has nothing to do with cable TV or other residential services. There was once a time when TW Cable was considered more likely to go after TW Telecom rather than sell out to another cable company. By most calculations Comcast could do that themselves even after buying TW Cable – and get the coverage of almost all major U.S. metros along with telecom carrier smarts that they still lack. It’s an area very much worth watching.

VMware acquisition of AirWatch likely to touch off MDM consolidation

By Joe Schmidt Posted January 23, 2014

The following is a guest post by TC2 Project Director Joe Schmidt, who is based in Philadelphia.

VMware, a main provider of virtualized software and cloud solutions, announced yesterday that it is acquiring AirWatch, a leading mobile device management (MDM) supplier. We at TC2 have worked with both suppliers and think this $1.5 billion combination will be a positive for enterprises. Perhaps more significantly, the deal is likely to spark more acquisitions of MDM providers and signal a critical arena for serious enterprise engagement with the cloud.

When we help clients assess and buy MDM solutions, AirWatch is almost always on the shortlist of suppliers. Their solution-set is one of the best in the MDM space. With the demand for mobile devices and applications continuing to grow, along with AirWatch’s global capabilities and customer base, it’s easy to understand why VMware would be interested. The acquisition will add a powerful mobile device solution to VMware’s portfolio of desktop solutions.

For its part, VMware is a proven leader in providing virtualization of technology and providing cloud-based services. Most of AirWatch’s customers use its cloud-based MDM solution, so AirWatch and its customers should hope that the cloud-based MDM solution will become even better and integrate with other cloud-based enterprise solutions.

All this means that, sooner or later, other MDM solutions provided by the likes of Good Technology, MobileIron and BlackBerry may become part of a larger technology company’s product portfolio. As users demand access from any device, to any service, at any time, the solutions that can address this need are the ones that will succeed. And the AirWatch acquisition is an alert that MDM is critically important and needs to be part of an enterprise’s network strategy.

But this strategy needs to go much deeper than simply deciding if you’ll support BYOD and/or corporate-sponsored mobile devices. Your strategy needs to acknowledge that employees will expect access to personal and corporate information from a multitude of devices, including smartphones, tablets, laptops, and workstations, and you need a solution that secures and protects the users, the enterprise, and the data.

That’s also good motivation to turn your attention to a more comprehensive corporate cloud strategy. Enterprises need to realize that more and more suppliers are developing and acquiring solutions that will be sold as a service in the cloud. You may eventually find that if you want a best-in-breed solution in a variety of areas, not just MDM, it may only be available in the cloud.