Yesterday at the Goldman Sachs conference, the CEO of telecommunications giant Verizon, Ivan Seidenberg, had a lot to say. Enough to get the 'bits' blog of the New York Times to write Verizon Boss Hangs Up on Landline Phone Business. Benoît Felten of Fiberevolution wrote some nice commentary on it as well. In essence, Seidenberg completely abandoned the traditional phone network model, both in its physical, copper manifestation and in the organizational structure that the RBOCs have built around it. Imagine five or 10 years ago hearing these statement from the CEO of an RBOC about the future of his company
“When you look at the FiOS architecture, our network doesn't look much different than any over-the-top player that would come into our footprint. So we can begin thinking about eliminating central offices, eliminating call centers, eliminating garages and doing all sorts of things that begin to change the entire topography of the Company.”
"But the thing we need to do now is remind ourselves that the inherent platform that fiber-to-the-home creates is not anywhere near what a switched digital architecture looks like or what a prior infrastructure would look like for a telecom company. We don't look any different than the way Google is going over the top and the way other companies are going over the top."
Say it ain't so Ivan... That's right world, now it's official - everyone wants to be Google now, even Verizon. Now all he has to do is convince the unions its OK to do all that! And then there's this introspective bit:
"I have never been more confident that I can see the end of the tunnel on this because once I shed myself of the burden of chasing the inflection point in access lines and say I don't care about that anymore, I am going to focus on driving FiOS penetration and taking costs out. I feel liberated, Jason. I am actually liberated. Okay, so you can ask me about inflection points all you want. I don't know the answer to it and I'm not going to focus on it anymore."
The copper yoke is off his neck, if not quite yet his company's yet. Well, it certainly does help that he's selling most of those landlines to Frontier Communications (NYSE:FTR, news, filings), so caring about them is becoming a rather moot point.
Regardless, is what we are seeing is Seidenberg (and Verizon) reaching the FIOS tipping point and looking downhill at last? Fiber everywhere means more than getting some TV revenues, it offers a chance at a fundamental transformation for which there is no financial model. When does an RBOC cease to be an RBOC? This is what FTTH has been about, and Seidenberg deserves credit for pushing ahead with it. The bean counters said it was too expensive and not worth the investment, but spreadsheets can't capture the transformational power of fiber.
Of course, right now it could just be Seidenberg and a few of his inner circle. Turning the lumbering giant that is Verizon into a lean, mean, Google-like bandwidth machine is a bit like turning a dump truck into an Apache helicopter. It takes a hell of a lot more than a guy with a dream, even one with his hands on enough cash flow to buy many a small nation.
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