There's no shortage of people out there making predictions for 2009, which means of course that there's no stopping me either. After all, looking back on 2008 is just painful, isn't it? So much happened that we'd all like to forget, whether in this sector or in the world in general. For the internet infrastructure sector, I'll categorize my prophesies, err I mean predictions, as related to Fiber, Data Centers, Content Distribution, or VoIP. So now let us gaze into the swirling mists of the Fiberoptic Ball (I upgraded my Crystal set, this one has a 100Mbps ethernet hookup:
- Icahn will finally take XO private. The stock has stagnated below $0.15 despite the summer refinancing, it is becoming hard to make the case that it is an artificial price or that an offer of, say, $0.50 would be lowballing it. He will make the offer, and he will probably succeed.
- Global Crossing will buy Abovenet. This just makes too much sense to me for both sides, and GLBC seems aggressive enough now to make it happen.
- Level 3 will survive. They always do, one way or another.
- Obama will just throw money at last-mile broadband access. As much as I'd like him to fix the disaster we call the FCC, he'd have to be a bit loopy to use up his political capital banging his head against that brick wall.
- Colocation prices will rise steadily. Construction is slowing more quickly than demand is, the consequences are obvious.
- The construction slowdown will end by summer. The very first place in the internet infrastructure sector that will see money from a recovering credit market will be colocation, simply because the economics are the most favorable and the value well understood.
- Everyone will call themselves green yet still use more power. When energy prices were high, everyone was an environmentalist and they really meant it. With energy prices lower again I predict that everyone will still be an environmentalist, but they won't really mean it.
- Akamai will sue somebody for patent infringement. Hehe, like that's a hard one. The Limelight case will end, and their legal team will send out the next volley, probably Velocix in hopes of slowing Verizon's effort.
- Pricing pressure will intensify. Simple math - too many CDNs, not enough content. Consolidation won't happen until the pain does first.
- Net neutrality will be a political football, but also irrelevant. As the debate moves from the informed techno-media to the politicians and the general media, it will cease to make any sense whatsoever.
- Vonage will put itself up for sale, but find no buyers. VoIP became a commodity so fast it isn't funny, it never got to be a cash cow so there is no long tail of cashflows here like there was with dialup at Earthlink.
- Ebay will sell Skype to Google. It always made more sense there to me anyway, I could never figure out why Ebay bought it in the first place. Skype needs a home.
Of course, I could be wrong! 🙂 Have a prediction of your own? Leave a comment!
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