Frankly, your arguement only reinforces my point - it's critical to 'own' the customer. The technology, and pipeline, etc. are relatively unimportant. RCN is building the last mile connectivity - or leasing it for now - so that they can own the customer (strategy similar to SBCs). Irrespective of what the service offering is, as long as they have the customer's confidence, they can cross-sell other/new services. VoIP (cable and DSL) is soon to become a serious reality - CPE available at really low cost in 75 days from now (I'm talking about traditional $2 million CO switches being made available at $10K - I'm dead serious here - with as good, if not superior capability and capacity. Qwest will most probably beat IXC, L3, Frontier, etc. to market, but the other cannot be far behind.) What everyone clearly sees is that the cost of voice service is going to crash even more - however, the future telecom revenues will come from value added services that companies such as IBM, etc. will be driving. If RCN controls the customer, then they make their money by taking a cut for customer access/transaction - whatever the model. RCNC sees that....QWST definitely sees it, and LVLT sees it as well. IIXC does not.
So, I guess at this point, with so much uncertainty about which business model will be successful, and valueable, we have to work with traditional valuation models I discussed in my prior email. |
