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The 2nd Emerging Communications Conference starts tomorrow. Registration is still open.

The programme guide has been produced and can be downloaded in PDF format here.

Below is the welcome message:-

Welcome to eComm 2009.

Our world finds itself at a critical juncture. Both trillions of dollars and the future of human communications including fundamental access to it are at stake.

For telecom operators and media outlets there is not a migratory way from where we are to the future. There is a clear consumer shift underway that runs in the opposite direction to that of telecom and media incumbents; emergent social practice is increasingly clashing with the very structure and desires of incumbent players.

A battle is unfolding which is taking place across three related planes; between industries that were previously clearly demarcated (telecom, cellular, Internet and media); between distributed, peer-to-peer ecosystems enabled by the Internet versus centralized, command-and-control ways of organizing to deliver services and content; and between opportunistic infrastructure versus tolled infrastructure.

Complicating the drastic change is the fact that the most popular means of communication, telephony, is increasingly broken. The experience and underlying paradigms are now at odds with the time and attention of the people who are talking through it. It's approached the point of being unacceptable and bad for the economy. Yet it's the source of nearly 80% of the multi-trillion dollar per year telecom industry. Worse still for carriers, telephony and SMS revenues will peak in most advanced economies within the next five years.

Yet as the telecom kingdom fragments it's leading to more flexible, finer and more dynamic means of assembly that furthers innovation opportunities.

The transformations emerging in global telecommunications and media, require big thoughts and big bets. We hope that you find eComm the venue for those thoughts to be shared and heard.

We'd like to think that what happens this week will have reverberations globally.

Glad you've joined us.

eComm takes place March 3-5, 2009 at the San Francisco Airport Marriott; a free shuttle ride from SFO airport. You can register here.

At the start of 2008 I had the pleasure of doing a pre-conference interview with good friend Martin Geddes. We had sat down together for a 15 minute chat. But before we knew it, we had chatted away for over an hour, which we were only forced to terminate only because the batteries of the recorder died. Due to time constraints, only part of the interview was ever published. But since the content quality was so high I put it on my to do list to publish it in full at a later date. I'm glad to say I finally got around to have a new and full transcription done!

(Note: other "Martin media" was his appearance twice on video during the 2008 conference, once for his keynote and once for the wireless innovation panel)

The run time is 1 hour and 4 minutes.

In the huge transcript below, I've blockquoted Martin to distinguish the pair of us from each other.

So tell me about your Telco 2.0 initiative? What is the Telco 2.0 initiative?

The telecom industry is in a state of flux and it's following a path that other industries have followed in the past. If you look at the physical logistics industry, containership came along and it broke apart the vertical integrated break box system. Instead you got this big steel packet that's been moved around; it became very modular horizontalized industry. The financial services use to be very vertically integrated. The same company that you went to, to go buy a mortgage from, you spent the next twenty years paying that same company and they had a loan on their books. That was it. Now, the moment you've taken out your mortgage, they go and resell that debt on the mortgage market. There are all kinds of specialists who package up and resell it. Telco 2.0 is about moving to a world where vertical integration in the telecommunications industry is coming to an end. You're seeing new industry structures emerge. It's how to remain profitable and alive in that environment.

When you say vertically integrated, my mind instantly jumps to applications. Are you saying that telephony and SMS, these are what I understand to be vertical products, are you meaning by vertical the industry as a whole in some kind of business fashion, or are you meaning applications when you spoke there?

There are many parts of this puzzle. So you are right; there is a question like the macro organization of the industries. Once upon a time AT&T also had Bell Labs. AT&T controlled local and long distance and the technology side.

There's also the vertical integration in what we call the applications stack. Between the application itself, the session control or whatever goes underneath the application to enable it; what pages you have, HTTP; you know they are separate things on the web. Then you have the core transport, the protocols like TCP and IP. Then you have the low level stuff like Ethernet and physical infrastructure. There's a question of integration in that.

There's also a separate question of virtual integration. That was kind of the technology integration. Did the application at the top have to care about what kind of network it was running over?  Is there stuff in the middle hiding that away from it? 

There's also a separate thing which is the commercial integrations. You mentioned telephony and SMS. What's interesting about them is that when you make a phone call or send a text message, it isn't just what goes over some dedicated network specifically for telephony or text messaging. Also, the money flows in the counter direction.

When you send a text message, you go and get charged 10p for sending that message. It's the combination of technical vertical integration and commercial vertical integration that makes different patterns for different types of system for distributing data to users. Let me give you some examples of that.

Take something like a content delivery network that your iTunes, Apple - you want to go and deliver movies over the Internet to end users. The end users will then download it over their standard Internet connection. It's a very low amount of technical integration between the movie and the ISP client. They don't need to know about each other.

But there's a content delivery network somewhere in the middle that Apple is paying that content delivery provider to cache and deliver that movie. So there's money flowing back and forth. It's based on the volume of movies. There's some degree of commercial integration. So you can move the levers back and forth and look at different parts of the puzzle of delivering voice and video and other forms of data. You can get varying degrees of technical and commercial integration.

It seems somewhat complex to say the absolute least. Would you agree with this?

It is complex [laughter], but what's interesting about it is that we currently have this utter total fixation on the broadband ISP product, which is one where the applications have access to no means of transferring money based on who's going to pay for delivering this movie. There's no API for payments to an ISP. I'm happy to go and get the user to download this movie from this website and please, I'll pay for its delivery. Don't count these bytes against the user's monthly usage cap. This is what the application provider would like.

So you've got this total fixation with the broadband ISP product, which has the benefit of separating the applications from their delivery, but also loses in that process the commercial richness of the telephony and the SMS. That's a problem. Although it's complex, the model of different kinds of vertical integration be it technical or commercial, it's very important because the future of the Internet and the future of broadband is largely about putting back into it some of the rich commercial models from other delivery distribution systems like the PSTN fixed telephony system, but without all the technical limitations of old legacy systems.

Surely, if you pay for connectivity, you decide how many Gigs you want, what speed you want, you purchase connectivity as a product, surely it should not be bound in any way to the application. An application you may pay for, you may not pay for, but these are separate things?

There are a number of subtleties to that question. One of which is basic connectivity, what do we really mean?  There are really two parts to that. One of which is getting the pure access part, which is how do I get from my mobile device to the cell tower, or from my device in my home up to the central office?  It's renting that copper pair or that co-axe cable, the fiber that gets me to the place where telco things start to happen.

Then separately from that there's a question of getting the data across the world to where ever it needs to go. What we're seeing is that the access component is relatively steady over time.

Steady in what fashion?

In terms of how people are going to pay for this. Here in the UK, you pay 12 pounds a month to BT for your line rental. That's the access component and separately you pay for an ISP plan; for 17.99 pounds a month you go and get Tesco Broadband [a no frills service]. Now for you the broadband service is at the top.

So, what we're going to see is that the users don't like having to think about how many megabytes and megabits they need. So if you want to go and access the new BBC iPlayer online, and you're on Tesco value broadband, you've only got a one Gigabyte usage limit in the month. The average user is not going to want to start thinking about the bit rate to this streaming video. All they want to know is "Either I'm buying some product, which comes postage and packing included, or it's some ad funded thing from YouTube and Google is paying for the whole delivery of this thing."  What they don't want to do is have to think about megabytes and megabits themselves.

Also, they don't want to have to provision a new set of access every place they go to. So when you go to your parents at Christmas and you spend all Christmas trying to recover from the turkey and pie in the bedroom; to surf the web [laughter] rather than interrupt the relatives, you don't really want all your usage at your parents house to be counted against your parent's ISP plan because they might be on Tesco value broadband and not on the super business class version that you prefer.

So we have to work out how to go and package the access, the data service itself, and the application devices in new and different ways to sell the user exactly the thing they value and no more or no less.

I think one of the best example at the moment is Amazon's Kindle product. You buy this device. It's got EVDO or whatever it is, built in as a network access. It does exactly what it says on the tin; this device will deliver your ebooks. You don't have to think about megabytes and megabits. You don't have to think about where it's provisioned. You don't have to think about hot spots and "Gee, I get the WiFi here and only have cellular there."   It just does it. It's been packaged up perfectly.

So bundling connectivity with a device, a specific device, I can see how it has value. Look at SMS. It's something which is bound to a device and connectivity and it just works. Do you know what the value of the SMS market was last year?

It's about one hundred billion dollars a year.  The figures obviously for 2007 aren't all out yet, but it was pushing one hundred billion dollars, which is bigger than movies and music and the game software industry all put together. There's something special about it, clearly. For the few gigabytes worth of traffic that all the SMS adds up to be, it's a relatively small amount, the users are paying very, very large amounts of money; only if you view that purely from our technical viewpoint. What it's telling us is a couple of things.

One of them is that when you break apart a product into smaller pieces and sell it, by the sachet rather than buy the big bulk bottle, you get much higher margins. When you buy something wholesale, it's generally bought in huge amounts at very low margins. By the time you're selling it in a tiny sachet, the margins go up.

Another thing is that SMS is a distribution system for messages and data. Each of these distribution systems has a large number of attributes, one or two of which are what kind of technical data can it carry and how can you make payments through it? But it has a whole lot of other attributes as well. For example, the difference between SMS and the Internet is that SMS is based on phone numbers; phone numbers are attached to countries. So if you are running the Eurovision song contest and you want people to vote for songs, but they can't vote for the song from their own country, with SMS it's easy to filter out those votes; if Germans vote for the German entries, ignore it.

With Internet you can't, with high certainty, know which country or jurisdiction an IP address is attached to. It's easy to fake it as well. So there is tons of cheating, if you try to do Internet voting for the Eurovision song contest. So it's only by understanding the full suite of attributes that these distribution systems have and their cultural context and their expectations? 

Like Telex, it has particular laws. It has legal force in the way that other forms of communication maybe don't. You have fax and it became a legal form of communication ten or fifteen years ago, even though it existed for longer. You have to look at the whole context of each of these systems.

The clever thing you can do as a telco application provider is to blend together these different systems, to create in effect, new communications media. I think an impressive example at the moment is something like The Sky Anytime box, where it downloads ...

You just mentioned Sky but that is British only?

Sky is a multinational satellite broadcaster but I don't know if this box is available outside of the UK market. This box is their way a telly takes content from the satellite; it caches it on the hard drive inside the box. You can also plug into broadband and download content over broadband. It's a clever little box, they can push down to you what you might want to watch. It merges together broadcast and broadband. Of course, you can have your DVD player underneath the telly as well. There are multiple ways of delivering bits to the user. Sky has blended together the best of several different distribution systems into a new one.

To passive consumers, this is an interactive thing [the Internet]. I am getting slightly scared in case we end up with glorified CD players hanging off the end of networks.

What's the lesson from that Sky example? Or Netflicks. Netflicks is using the Internet as a signalling mechanism and the postal service as the bearer. The postal service is a very efficient way of transferring tens of hundreds of gigabytes worth of data.

I think the important lesson is when you take this to where the cash is; the money is in voice, there's been this fixation with Voice Over IP for a number of years and actually maybe - this is heresy - but maybe the good old-fashioned phone system is really good at transferring voice [laughter]. Time-division multiplexing?  It does constant bit rate voice very well. You have to throw an awful lot of technology at a problem that doesn't exist to try to persuade anyone to move over to Voice Over IP.

Anyone understanding the full context and capabilities of each of these systems should start to think, "Hey, actually maybe what the Internet is good at is allowing new forms of signalling to evolve faster than SS7 or whatever might otherwise allow. Even those things in principle could evolve."

Well it allows niche signalling systems instead some large monolithic controlled block.

Why don't we focus on enabling the IP parts to the thing it does well, which is, "Hey how do we enable the rendezvous in front of this phone call?  How do we send signals and presence data and the picture of where I'm at or vacation information wherever it might be, to help people make phone calls at the right time, is getting it to both of them. " 

Then, stop worrying about trying to do Voice Over IP until the technology is upper duper mature and people decide that we can't possibly afford to maintain two networks, which is quite a long way away still. Let the phone network do what it does well, which is phone calls.

So, for 2008, you're promoting TDM? [laughter]

Oh, yes. [laughter] TDM ... the future is in...

In TDM. We bypassed it and now we realize we should have just stuck on it. [laughter]

Embrace, extend, extinquish - yes - as Bill Gates would tell you.

I cannot help, and there's so many topics you've cast up and so many things I want to ask as usual, but immediately on that point what do you feel will be of BT21CN then?  Because with British Telecom's 21st century network they are going to switch off their TDM in say 2011.

21CN is a really big thing. There are lots of different parts to that project. If we're just focusing on the voice network part itself, I'm not privy to how they start paying their suppliers for the TDM equipment, and what the situation would have been with end of life-ing support for their equipment and the like and spare parts.

Well, BT is on record as saying they're going to be saving one billion a year in OPEX.

So by spending a large number of billions you have CAPEX you get OPEX savings. I am not privy to the figures. But, what I would be tempted to do was look at how long it's been from inception to delivery for 21CN.

How it was sitting now, I went to the BT website and it said 21CN will be turned on at this road in Edinburgh in 2011. It's the beginning of 2008 and in my book, that's an awful long time to be planning a technology project over in this environment.

You could have built a wrapper around the existing voice network, offering web services and other capabilities, and started to enable lots of the quote "advanced services" that the 21CN would offer years earlier if you had wanted to.

Maybe this [BT21CN] is a longer term approach. Maybe it [not doing BT21CN] would have given you incremental services whereas with BT21CN it is going to give you something which is going to be suitable longer term. You can do more with it because it's an entirely new network, a very fast network.

You can see the allure of moving to an all IP network, but you also have to understand the high risk of having any project that has a five to ten year implementation timescales. Because remember that whatever protocol and architecture that you are choosing at the outset might be obsolete by the time you get to the end. Look at SIP, which was the obvious clear winner out of all the IP signal protocols, even that has its problems. It's got it's architectural mistakes.  It's got incompatibilities. It's been an absolute nightmare to get everyone to have the same understanding of what this particular SIP message...

You mean it's not the session initiation protocol, but the subject to interpretation protocol?

Yes, absolutely [laughter]. And as a result, the chances of SIP itself being exposed to the application developer and being in the interoperability layer, probably isn't going to happen.

Then how do you expose it to the application developers?

I think that these things, if not IMS is all about 'they're good at certain things' and you need to understand what they're good at. What is SIP or IMS good at?  Well, it's good at provisioning, doing signalling to say, "Hey, Tom over here has paid a certain amount of money to have a certain kind of traffic be hauled over this network", over some kind of virtual overlay or whatever they are going to do on top of it. It could be a full capacity reserve pipe we're going to pretend runs over this network. Or, it's going to be something that's prioritized; it's going to be best effort or whatever. It's [IMS] good at managing that, provisioning of virtual circuit.

What it isn't necessarily good at is trying to have a common understanding of what some presence message might mean in the future, because it's all contextual to the user. You go on-hook or off-hook even. Even something as trivial as that, having a common understanding of that would be, you might say, if people have speakerphones, or they go three-way calling;  you add these new features in and suddenly what does that old message mean in this new context?  It might not mean the same thing as it used to. Even if technically you get these networks to inter-operate, it doesn't necessarily mean they're inter-operating it in the users mind.

So let the signalling protocols do what they're good at which is help the telco be a logistics provider; a personalized logistics provider for data. That's what telcos are. They haul data around from point 'A' to point 'B', but they do it using a number of means so it could be broadband, could be content delivery network, or edge caching which is where you broadcast something out like Sky, cache it at the edge of the network and then you can redistribute it to other people who on the edge of the network.

You can do this with Sky?

Whether the Sky box has peer-to-peer redistribution, I'll need to go and have a look, but certainly edge caching is a capability that some of these set top boxes have.

What the telco does, just like a logistics provider for atoms blends together rail, sea, land and air transport, telco blends together all these different types of delivery. In voice you have prioritized networks versus best effort versus full circuit switched and packages them up with the application and the device, but it doesn't get involved in the applications themselves.

All they are doing is helping these people get the data from 'A' to 'B', which isn't being just a dumb pipe. It's a lot more complicated than being a dumb pipe. Because you have to slice and dice up that pipe, enable competing and contending uses of the pipe to be prioritized against each other to be able to have much finer grained provisioning of the pipe.

For example, when you're at home and you're accessing your employer's internal sites over VPN, surely your employer should be paying to have all that VPN traffic being hauled. You shouldn't be saying, "Well, I'm paying 20 pounds a month for my broadband. Maybe I'll expense 5 pounds a month to my employer." No, they should be paying for it, even if you haven't got broadband at home at all, as a retail ISP for yourself, you should have to have access to your employer's stuff [via broadband].

Is this not like beginning to say that if you buy a kettle, that somebody else should be paying for the electricity that goes into the kettle and maybe somebody should pay for the electricity going into the washing machine?  Shouldn't connectivity, the ability to haul bits - bandwidth - into the home, shouldn't that be treat just as electricity coming into the home?

It's interesting.

We're falling into the net neutrality thing here.

There are some specific things about the power industry and electricity distribution, which are interesting. This contrasts with the postal system. When you have something delivered over postal system, you can either buy a stamp or you can go and get a prepaid envelope or you can just put it in the postal system and have it run off and not pay postage at all and somebody else then has to go and pay penalty postage at the other end. There are all kinds of different ways of deciding who pays for the thing being posted. It could be the person at either end.

Electricity distribution, a bit like broadband, doesn't offer these different payment mechanisms. There are good reasons for this. It could be tied to technological issues. It could the history of the medium itself. In some ways it could be a good thing that appliance has to account for its own usage.

I'm thinking accounting for CO2 production or something. If some old appliance that you have in the house is rated to use 1kWh a month and suddenly it's using three because its fuse is burning out or something, and de-provisions itself from the network, that would be a good.

But, there are actually good reasons why the power network doesn't have this capability. If you take a slightly different example, like the great blackout in the Northern US a few years ago, that was partly caused because they were trying to move to a more horizontal industry structure. They forgot that power distribution was vertically integrated for a really good reason, which was that no matter what you're abstraction was in terms of energy trading, the reality was that you had currents flowing through wires. When you have too much current going through wire it gets hot and it starts to sag. If it sags too far it touches the wire below and they short out and your power system fails. That's what happened. The power line network literally melted because too much power started to go in the induction loop pattern and it all went wrong.

So, you needed someone end to end to be able to manage the whole vertically integrated distributed system. There are historical reasons, not technical reasons why some of these networks don't develop sort of modular layered interfaces.

Sounds to me like you would like to apply a signalling system to the electrical system, by analogy and have our kettles and so forth signal their usage etcetera, and put toll booths in there.

What we're leaning towards, the whole network neutrality debate. Should your power company be able to say "Well, you're British, you live off tea. Without tea you'd perish. So, we're going to charge you lots of money for kettles. But perhaps this house heating, well the Brits are pretty used to living in the cold and damp. They won't notice much if their houses are still cold and damp. We won't charge them very much for heating the house by electrical power." 

If you only had a choice of one supplier, then that would be a bad thing. Because it would allow them to price discriminate amongst all the different uses you have and basically reclaim all the value of electricity for themselves. In a competitive market, it would be a good thing. Now it seems utterly bizarre to think of having to provision a device before you plug it into the power socket, but if you really wanted to manage your power usage better, or be able to go and compare a Bosch refrigerator. On the refrigerator there's the little EU mandated power efficiency chart. It turns out that basically all the refrigerators in the row all say "A", because in the six years since they started or ten years that they started to scheme, refrigerators have all got much more efficient. They all got to the top of the scale. There's nothing best on list tells me, really. . .

But they may never have got there had they not put this A-to-F label on there...

Imagine for a moment, I could go and buy a refrigerator and it came with twenty years of service and electricity included. I could see the full price, the lifetime price of that appliance there in front of me. I don't need to go and say, "That one is 700 pounds but it uses 22 kWh a year and this one..."  The whole thing would be bundled there in front of me.

It would be a good thing and a bad thing in the white goods appliance market, you could argue. But at least have the option. If the power socket was able to say, "Ah, the power going for this device is provisioned to this other account."

But for that to happen you have to have a very rich wholesale market in electricity for the refrigerator maker, to have a refrigerator work regardless of which power company you happen to have chosen as your retail provider for power, so you'd have to various intermediaries and a new market structure.

So then how do you stop them reclaiming all the value?

As long as there's competition at the retail end, so you have a choice...

But that's a major thing; "as long as there's competition."  Most of my American buddies are claiming there isn't competition, there's a duolopy in the US.

And they are right. There's a duolopy in the US. There are some pros and cons of that model. You ask the people who are in the lucky areas where Verizon FIOS has been deployed because the Verizon model said this is a zip code with a nice high income of people who pay their bills and would quite like to have lots of premium direct TV. Well it works to some degree. But unfortunately I think that it will also greatly inhibit the growth of the necessary economic models that will be needed in the future; particularly growth of rich wholesale markets in access and connectivity.

What will inhibit it?

The vertical industry structure you see in the USA; where AT&T and Verizon and a few other companies, dominate the market and you have very limited retails choice; you have choice of either one or two broadband ISP's.

Now the UK market has a thriving, vibrant wholesale market, France has a thriving wholesale market, as a foundation from which to grow new wholesale products, which would enable new kinds of connected appliance to be offered.

So you go out and you buy the Apple TV box and plug it in, you don't have to think about which broadband plan you're on, is it the right broadband plan and fast enough and enough megabytes and gigabytes per month?  It's Apple and it's the iTunes service that has to worry about getting the content onto the box and paying for it.

As long as you don't have a bottleneck in that little access loop stopping retail competition, then the network neutrality debate, this whole bogeyman is like a shadow on the floor. But, the shadow is actually something you want, which is a rich wholesale market.

The idea that Google will be charged extra for delivering YouTube videos, here's the secret, it's a good thing when Google could offer YouTube videos and you could sit there and watch them all day, every day in standard definition, high definition resolution or whatever you want, and Google is footing the bill for you. Today this isn't the case.

Martin, these things you mentioned in the start, sound to me are a double-edged sword. What could happen, excuse my instant pessimism, is that you'll get the same Google video quality but the telco will charge you 5 pence or 10 cents every time you watch a video.

The worst bogeyman fear with network neutrality is Google charging you; your ISP will be charging you to go into something you value highly. That isn't going to happen, it's not going to happen.

Why are you so sure please?

If there's going to be any charges, the charges are going to be to those upstream parties like Google [as opposed to downstream to the consumer]. It's going to be to the people like Microsoft for delivering your ...

It may just give you what you have today, that is the fear; that's where the anger, the sentiment is, which you may even be detecting from me.

But, it's [network neutrality] trying to treat the symptoms caused by a lack of competition in the access bottleneck. You can't cure cancer by giving people more morphine. It doesn't work that way. It seems to take the pain away, but you'll still die. 

In the US market, you need to understand the infrastructure is not part of the telecom industry, basically. The infrastructure is part of a multi-utility access business. Their job is to synchronize up the replacement of the gas pipe with a length of new fiber; all the replacement of older street lamps and the digging up of the road with deployment of the new fiber down the road and you do drops off the side. It's to take the cost out of the thing.

It's advertised over a twenty, thirty or whatever years. The plastic pipe itself might be there for 100 years. It's financed differently, maybe under different ownership structures that are designed to create open access and neutrality. If you want neutrality, neutrality needs to be a different layer [laughter]. It's not the IP layer. It's not layer three. Neutrality has to happen at layer zero and one. When you've got the rights of way and the conduits and the access ducts and maybe the physical fiber or copper, that's where the neutrality needs to occur. They picked the wrong place to go fight a battle. The good news is that if you started initiating network neutrality legislation, I don't think anyone could actually write anything down that would be meaningful and enforceable. So it's largely hot air.

Network neutrality means to me to sell me something called Internet, let me shunt bits backwards and forwards, and don't discriminate those bits in terms of pricing. Is that not something simple?

Let us understand this right. You'd have broadband service providers, people who are selling access to a broadband pipe, and within that today, most of their money comes from offering the Internet product through ISP. Now, within that product, there's clearly a problem today, which is that some or many users have been misled as to what they're being sold. They've been told unlimited, asterisk. What the asterisk says is not unlimited. They've been told Internet access and in practice they're finding that certain protocols and certain destinations are being throttled. It's the mismatch between what the consumers been told and what the reality is, that's the problem; not that less traffic should have been going on.

The evidence of that is that there are ISP's like PlusNet in the UK, who are brutally honest with their customers. They have whole web pages dedicated to saying, "Here's how we're going about shaping our traffic today."  They publish all their current traffic stats on their website day by day. They tell you when you buy the thing, "Hey, we traffic shape and we love it."

If the user buys it, they have their eyes open. They know what's happening; where is the problem? It's between consenting adults?  The problem occurs, much in the market. People's ISP contracts have this clause that "we can do whatever we like whenever we like without telling you about it."  That's wrong.

There's a consumer protection issue there. That was like Michael Powell's "Fourth Freedom", freedom to know what's in the plan. That isn't currently being enforced. You could call it net neutrality, the neutrality of the network, but can you have a very un-neutral ISP plan if you want to, like PlusNet's. It's absolutely fine as long as the user knows about it; is told about it before they buy it.

What it also ignores is that outside of the ISP product, you look at all the other products that the broadband service provider could be offering, all these other wholesale products to say, "We will give you universal access to all government self-service websites..."

Also, if a doctor goes to any person's house and plugs in a different little modem into the phone socket, they will be provisioned to have broadband access while they're at that patient's house, regardless of whether grandma has actually got broadband herself.

So there could be all kinds of other products and services that the broadband service provider offers, which the neutrality thing is irrelevant to. The government or the National Health Service goes out and buys these business-to-business products. Where's the problem? You have professionals buying off professionals. They should know exactly what they're buying and know how to buy it.

You informed me that you've recently published under STL Partners; telco2.net - I think is the best place to look for the STL Partners work, am I right there?  You've recently published a future of broadband report?

We've just finished a six month study on the future of broadband, the future business models of broadband. To do that we did an online survey, which over eight-hundred people responded. We've talked to dozens and dozens of people. We did a lot of in-depth research. We have been comparing the broadband industry to other industries like container shipping, and the power distribution industry. We've been trying to learn the lessons, what we can, from these other industries and answer what does it mean for broadband?

Our conclusions are very much what I've been describing, that is, broadband is part of a multi-network, data logistics business. It doesn't exist in isolation. You have to be able blend together multiple different distribution systems. If you're offering an IPTV, for example some kind of enhanced TV service, you ought to have voting. Then that voting might be done by SMS and actually, if in your little set up box you captured a person's mobile phone number, and authenticate it, they may not even necessarily need to send the message directly from their mobile phone. There are all kinds of different ways of blending together these different systems.

Does that not mean that you're saying broadband providers should start going out and buying postal offices and courier vans and jiffy bags?

Yes, it's the digital equivalent to these. What they need to have is they need to get involved in content delivery networks so there is bulk content, that is not time sensitive. It needs to be cached somewhere in the network. Today, companies like Akamai put their caches in a more centralized locations, but you don't find these caches inside of every DSLAM inside every central office. They cache stuff at the edge of the networks, on your PC, in the set up box, in the home hub, and these go on to bridge different systems so it would be able to have BT Vision box where you can take freeview broadcast TV and cache that. You would be able to take broadband and broadcast and these other systems and be able to meld them together into new things.

They also need to deal with we may call the customs aspect of being a logistics provider. So when shipping sea containers around the world, you have these weight bills and manifests and you have to pay customs dues and stuff like that. The digital equivalent of that is being able to deal with authentication and provisioning for all these different networks and connectivity.

Another part of it is you take the postal analogies. You walk to the post office and at the back of the post office are all the counters where you go and post things. But normally, there are racks and racks or wrapping paper and letters and pens and all kinds of other things you need associated to the postal delivery. That's the value of the services. So on top of the basic logistics business, there are a number of value added services.

In the physical world you have insurance as an example of a value added service. In the digital world examples of value added services would be advert insertion, or quick checking;  so the telco knows where you live because they have a copper cable that goes to the front door, they have been receiving payment from you for a certain period and they know if it good debt or bad debt. Recently the biggest credit checking company in the UK is BT; they did more credit checks than anyone else. Yet, if you're running an application over a BT DSL line, you have no means at the moment of interacting with that very private and personal data.

So there are all these value added services - location, presence and other examples where the telco or broadband service provider is a supplier to people who are building these applications at the top of the network. They are doing things which are natural by products of running the network, a logistics business. They're not toll keepers getting in the way of people actually trying to build their application and deliver it. They're suppliers of the things that these people voluntarily draw on and pay for because they add value to their business, not because the telco's getting in the way.

So is it your position on net neutrality that it's a moot point?  Is that my understanding? 

Pretty much yes, because I've never managed to see a really meaningful definition of net neutrality. I've seen lots of high level superficial definitions, but when it comes to applying those ideas in practice, they're far too woolly and vague. It's just a name for a fear, not a name for a viable policy that any one regulation can adopt.

Have any networks ever been neutral? So when you download something over the Internet from Korea, some piece of content you want to download, and you think, "My goodness, it seems to be going down really fast." You download from outer Mongolia, you think, "Gee, it's going down really slowly." That's because of the really big fat pipe that goes to Korea and the really thin pipe that goes into outer Mongolia. That reflects the relative demand for those areas. You could then say, "It doesn't seem very neutral."  We're discriminating against the outer Mongolians. Well what is your the duty?  What is neutral?  What experience is supposed to be neutral that you're delivering to everyone?

If YouTube suddenly explodes in popularity and it is generating tons of transit costs to ISP's, are they suddenly under obligation to maintain a certain ping time and bandwidth through to YouTube when I go to the website?  What is this neutral thing [laughter], tell me?  Do we have to have regulators imbedded every router on the Internet saying, "I'm very sorry, but you can't route that that packet that way. The ping time is too long. It's not neutral." [laughter] The World of Warcraft players won't be happy.

The fear is being very well defined, the net neutrality fear; if you go to a website which isn't on your telco content partners, like their video partner or their news partner, if you go to a news site that isn't on their partner list, you're going to be charged for reading the news on that site. Is this not a well-placed fear?

If you lived in a market where there absolutely no choice as to which ISP you had, or there was very little choice such as the US, I guess it's possible that the Internet super highway man might then come along and rob you of your valuables as you go past and insist on an extra charge to let you pass.

But actually, what we want to see emerge is a rich wholesale market where Google could come along and say, "Hey, you want to watch YouTube or watch YouTube all day in standard or high definition without any charges and you don't have to worry about going over your fair usage limit or your set cap limit. It's all on us [laughter], keep on watching those adverts, keep on clicking on those little contextual ads. Here's the problem. The current ISP model tries to charge everyone the same amount for a very broad spread of actual usage. But you can't remedy that by going back to metered usage because people hate having a clock put on, and they don't understand megabytes and megabits stuff. You can't traffic shape your way around the problem because the users don't really understand advanced network policy enforcement; obviously there are a small segment of users who do. Some gaming users might be more than happy to be on an ISP that tries to prioritize certain real time flows or holds back peer to peer because they want to have priority in the network for the games.

But by and large, none of those things work out. So, the way to solve it is to take the voice and video traffic, take it out of the ISP product but to do it in a way that is beneficial to the user. The user actually wants it to happen. An example would be that you could watch YouTube videos until your eyeballs fall out because you know that it isn't costing you a dime. You can make phone calls from your mobile device to your work colleagues through your exchange server, to your prospective date through match.com and all these separate voice enabled applications just work and it's all charged back to the appropriate person; back to your employer or back to match.com.

Net neutrality fear is that a bogeymen will come a long a rob you. But the bogeyman really is just a shadow of something we actually want, which is a rich wholesale market.

You said at the start, that there isn't such a rich market in the United States. So their net neutrality fear is therefore very real then?

It's real in that there is a gap between what's being sold at retail by an ISP and what you're actually getting, that Comcast could suddenly come and decide that "we don't want to have this peer-to-peer traffic even though we sold you Internet access." But the solution to that is to restructure the industry so that users have retail competition. They have lots less people trying to compete for their business and if one of them turns out to be a two-faced liar, then you just don't renew with them, you go with somebody else.

That's not going to happen within the current US industry structure. The consequence is that probably the US will fall behind as an industry leader.

Have you given any consideration to open wirelessm, in the 700 MHz type stuff? 

It's very hard to make a call on some of these things because there are certain benefits to vertical integration. It helps to pull more money into the infrastructure layer. You cross-subsidize infrastructure from your overpriced application services because you can control what runs over the network. The problem is then you end up with a very stagnant set of services in the network because everything is gate-keepered by telco. Telco's idea of progress is not the same as everyone else's idea of progress.

So, superficially, open access is pretty attractive. But, it's really unclear how this tension between the commons of the network and the need for innovation and the need to be able to ration out a fixed amount of space is going be worked out. I'm really keen to see the experiment and I think the experiment should be well-run; there should be enough spectrum given enough open access rules. There are a number of different models, potentially. Something like WiFi, which was a bit of a free for as long as the power levels not too high, some were it's open access bits or wholesale; business to business types of transactions going on.

Lets see the experiment run because I don't think anyone is sufficiently clever to understand all the variables involved and how it will work out. Let's see the experiment run many times over in different places and learn from it. At the moment nobody really knows what the outcome will be.

I noticed that you were the only keynote speaker who still hasn't put a final title on his keynote [for 2008]. You haven't submitted any talk text. What are you going to speak about?  You hinted it was different distribution models?

What we've studying is how telecoms is just one of many distribution systems of data and how telco's can turn themselves into being logistic service providers for data. I've been doing a six month study on that.

I was procrastinating about what to talk about because I've also been thinking about the future of telephony, voice and personal messaging. Another option, which I won't talk about, was just how telephony and phone calls are just one layer in a nice, rich, thick five layer sandwich. The sandwich, the pyramid of these things, goes from the top where you have communities. There are a small number of communities which are made up of relationships, which are people. Below relationships you have conversations going on. You don't talk to someone for twenty years if you really don't have a relationship with them.

Yeah, communications are required to have a relationship, right.

The conversation is made up of things like phone calls. I think below phone calls is an interesting extra layer - rendezvous. Although some phone calls are being used to try and help organize the real phone call. There we find the real conversation. Not all the conversation occurs through telephony. Some of it occurs face to face. Some of it occurs through other media like email.

People are often phoning up to say, "I'll be there in five minutes, I'm just running a little bit late. I'm on the train."  There are all kinds of manual transfers of location and presence data, which are being done through telephony, but they aren't phone conversations in that sense. Today's telephony product is very broken in terms of helping people to meet up at convenient times. If I want a call with you, I can't just send through into your requested call list, like your missed calls on your mobile, "Martin would like to have a call with you. At your convenient time, call Martin back."  If I'm unavailable the message temporarily disappears on your phone. If you're on another call, it doesn't try to invite you to call me at the same time.

There's an opportunity to fix the whole rendezvous process. There's an option to fix the conversational process as well. For example, dictating your name, address and credit card number and security code during a conversation with a call center is very inconvenient and painful, whereas, you'd like to just press "1" to release that information.

I think there's a lot of opportunity in terms of money to be made in fixing the problems of telephony. But, in a fifteen minute keynote you couldn't talk about so much. I think I ought to focus on what the phone company becomes which is the logistics service provider for enabling the transport of personal communications data and generally get out of the way of running the phone business.

But you try to milk the existing phone business for all it's worth and help integrate it with all these other revenue generating businesses like ecommerce or vcommerce.

So, why are you coming to the inaugural Emerging Communications 2008 Conference, eComm, March 12-14, 2008, at the Computer History Museum, Mountain View, California?  Why are you coming along?  Why are you putting your ass on a plane in order to do a long haul flight to go over there?

I'll tell you, it isn't for the frequent flyer miles. It's because there's been quite a lot of talk recently about how VoIP has become boring and dull, there's no money in voice and voice is going to be free. That's rubbish and nonsense. It's a complete misunderstanding of the size of the opportunity and how voice and telephony and personal communications are the anchor in which the whole of the telecommunications industry revolves. Despite the fixation on media and entertainment, which seems to drag people off to false alleys all the time.

There's actually a huge amount of opportunity for telcos to turn themselves into platforms that are suppliers of personalization and rendezvous and authentication and payment, credit checking and all kinds of other data than enable conversations to occur. There would be a lot of money in doing this. It's part of the big picture of being the logistics service provider, which would help actually deliver stuff, but don't get in the way of whatever is in the packet.

It's also to share some ideas that we've had within the Telco 2.0 space and our understanding of two-sided business models and some of the key issues and concepts around that.

Plus, look at the speaker line-up. It's such a concentration of the top people in the industry. It was just irresistible to come.

When you said that voice or VoIP is not exciting, why do you say this?

That's what many of people are saying. I think it's because they've got trapped in the idea that the value is all in the media itself. It's in the Voice Over IP. Actually, the value is somewhere else. The value is in avoiding wasted phone calls, people making phone calls and getting to voice mail when they shouldn't get into voicemail.

They've [VoIP crowd]  focused on competing with the existing telephony system on the thing it does best, which is transferring media and not the things it does really badly, which is location, presence, all these other things.

I think voice is going to be an integral part of almost every online application in the future. There will always be other people to talk to. There will always be support and service to talk to. It's a massive opportunity.

Are you saying that voice will become an adjunct to other things of value?

Yes, but it will be done different ways. Not everything will be synchronise voice. There will be a lot more voice messaging going on. People want personal touch. They want to have a sense of the other person they are communicating with, because they hear their voice. But, people won't always necessarily want to have synchronise voice.

But today's voice mail, which is completely disjoined from all the other online activities you engage in, isn't the answer. If I want to send you a voice message without your phone ringing, and do it with and instant online application, how do I set it up so that it delivers at the right time?  If you are off on holiday half way around the world, it doesn't arrive at 3:00 a.m. and wake you up saying, "Beep, beep", and you open your phone, when it's not something urgent. 

I think voice will be a story of the evolution of the web in the next ten years. It probably isn't so much around semantic web all this other geek-friendly stuff. It's around the touchy-feely side of how do you label relationships, conversations, and human touch?  There ought to be a lot more of a woman's touch around some of these conferences; understanding the less logistic side of communications.

When you spoke of that pyramid with communications at the top, actually communities at the top, and relationships underneath and communications underneath that; can you relate that pyramid to social networking sites and telecommunications companies?

Social networking sites are the top three layers of the pyramid then there are communities, they are formed of relationships, and then there are conversations. You can find people, get model groups of people and you can send messages to people.

Phone companies are the bottom three layers of the pyramid, which overlap. They enable conversations. They enable calls, and they enable rendezvous. The rendezvous is that you're setting up a mutually convenient time. I text message you and say, "Call me when you're ready."  It's part of enabling the rendezvous.

These two people over lap, but they aren't necessarily conflicts. So should Facebook spend lots of money enabling voice in their applications? No because we already have mobile phones and desk phones and voice capabilities. The PC is a terrible telephone. Why make it into a telephone?  It's not. So how do you capture someone's mobile number or some other identifier for them and integrate their mobile voicemail with the Facebook voice messaging?  That's the problem it's going to solve.

How do you enable someone to make a phone call within Facebook to somebody else in a way that they can see that the other person is available and wants to talk at the moment and is in a certain context and location?

So in summary where do you see the opportunity in voice?

There is a number of parts. One of which is simply enabling new forms of minutes; new applications which will carry voice and don't necessarily do it using phone numbers or traditional means of telephony. Another one we might call vcommerce which is all the ways consumers interact with enterprises; so it's communications enabling business processes like delivering a parcel to your house and making sure the guy only comes when you are home. Some of it is around vcommerce type activities where you register your credit card number with your phone company or bank details and when you interact with the call center, there is non of this "Habla espanol?"  They know I speak English. It's in my telephony profile.

There is plenty money in enabling these experiences, there is plenty money in eliminating the waste in today's telephony.  Every time I spend minutes looking up someone's number, dialing them and finding it's voice mail, a minute of my time is worth more than the ten pence it cost me to make that call. Actually, a minute of my time, during the day, at billable rates is a lot more than the 10 pence call. If you can save me wasting that minute, trying to phone someone who isn't there, that's worth a lot more than the phone call is worth.

It seems that many people are still living off the ten-year old VoIP as an exciting thing when we don't care so much about the cost per minute of your call anymore, especially with a crash of TDM prices. You seem to be saying let's stop worrying or thinking it's an evolution to try and drive cost of calls down. The electrical path, the physical connectivity costs are nothing. It's really the cost at the social level. The cost of human time and attention seems to be where you're saying the cost is. This is where communications must aim at solving these wastages of human time and attention?

the rendezvous layer, the driver has been the increasing cost of human labor and time, compared to the cost of the phone call. Above the phone call layer, there is the conversation layer. It's mostly enabling better conversations between users and merchants.

I like this very much. You're saying it's not five nines of reliability that matter, unless you're calling emergency services. When you call to say, "I'm at the supermarket; do you want ketchup," you don't really care about five-nines of circuits, I assume is what you're saying?  What you care about is five-nines of successful communications, which mean you don't want to wake your baby up when you call about ketchup. Is this what you're saying?

Yes, at the moment my kids are off with my in-laws. They're two hours ahead of us. I'm not quite sure exactly when the kids are having their afternoon nap. They might still be on British time or on Eastern European time. The last thing I want to do is phone up my wife on the mobile when she's just trying to put one of the kids down to bed for their afternoon nap. What I do want to do is ask her to call me at some point in next half hour because I'm free now. I don't send a text message because that will make the phone go "beep, beep" and will suddenly make the child who is trying to fall asleep go, "What was that noise?" 

So I want better telephony. I want the phone company to help me realize that. To let me have spy holes as to what's going on at the other end of this line, before I press the green button, to make a phone call.

What is the opportunity space?  Is this a large financial opportunity space that you see?

Yes - have I modeled exactly how you do it?  If I had worked out exactly how to make money from it, I wouldn't tell you [laughter]. I'm pretty sure that there is a lot of money in it. Because everyone has been looking under the wrong stone for the last ten years. They've all been looking at how do we arbitrage the metered-minute model. It's just irrelevant. Almost all of the voice 2.0 start-up companies have been centered around this, with a few notable exceptions. It's the exceptions that are the ones that are going to be the seeds in the new business model of save users time, give them convenience.

Who do you think is best leveraged to seize these opportunities, this new land-grab?  Do you think it's the likes of Google or do you feel telcos also are going to play a major role in achieving this land-grab of the financial opportunity space?

A few telcos that open up in terms of application platforms will be successful. They'll be successful because they've turned themselves into logistic service providers for everyone else, not because they can stand in the way [laughter] of people delivering applications they want to deliver. I don't think we've really seen yet, the new raft of communications companies of the future. There are a few I've seen that I've been impressed with, like VoiceSage, who help enable communication business processes, how to integrate telco capabilities with general business processes.

But for the most part, I think these companies have yet to come into existence. The current social networking sites are based around entrapment of the users and trying to capture their personal data, resell it, and do it in the ways that I don't think users will allow them to monetize, ultimately. I think we're still in the early phase.

Social change requires a user attitude change. The Internet mass-market phenomenon is twelve years old, thirteen years old. Despite all the hype, it's still early days. Things don't actually change that fast. People's behavious don't change that fast. I think we've yet to really see the communications companies of the future, but hey come to eComm to start finding them. 

On that note, and especially as you're looking so tired, after sitting here for an hour and a half, chatting with myself, which we all very much appreciate. It's always a nice time to speak with you, Martin. I very much look forward, and I'm sure other people do also, to the half an hour keynote at eComm. I very much look forward to seeing you in Mountain View, California, Martin. Thank you very much for your time.

Thank you, Lee.

(Martin is also on schedule for the 2009 event to give a keynote entitled 'Where is the Money in Voice 2.0?')

• Speaker: Anders Carlius (TerraNet)
• Materials: Slides

• Speaker: Norman Lewis (Wireless Grids Corporation)
• Materials: Slides

We're honored that you joined us at for the first eComm conference. In doing so you've joined history in the making.

This community finds itself --quite suddenly-- in a new world of more open opportunity. Open handsets, open networks and open telecom platforms lend themselves to innovation in the worlds garages and bedrooms. And the signs are promising. Within the last 12 months many important events have occurred. First Apple released the iPhone, a phone running their computer operating system; a high school kid then spent the summer cracking the platform, hacking iPhones went critical, and finally Apple itself was forced to "blink", resulting with the release of an SDK. The FCC stated that the next big block of spectrum would only be auctioned to an open network and Google announced first that it was willing to spend billions to create universal access through wireless spectrum. Then Google announced Android, a new open phone operating system; T-Mobile and Sprint joined the Open Handset Alliance; and even Verizon and AT&T made PR releases about becoming open networks.

We believe a new era requires a new kind of conference. Previous industry talking to the industry type events have yielded nothing save consensual hallucinations. The gap between what telecom operators are doing (or allowing) and what the innovation community COULD do, and where end users are taking us is widening fast.

Communications innovation is being democratized. The winners will be those who embrace it. So welcome to eComm 2008. Let's all create an Emerging Communications Community capable of rethinking the trillion dollar industry together!

Lee Dryburgh
Founder, eComm Media

• Speaker: Shai Berger (Fonolo)
• Materials: Slides

• Moderator: Brough Turner (NMS Communications)
• Panelists (in left to right order): Martin Geddes (STL Partners), Stanley Chia (Vodafone), Sumit Agarwal, (Google), Jonathan Christensen (Skype), Christopher Allen (iPhoneWebDev.com), Benoit Schillings, (Trolltech/Nokia)