To: topwright who wrote (26014 ) 1/27/1998 1:43:00 AM From: topwright Read Replies (3) | Respond to of 41046
All, as I stated in my previous post much of my recent time has been devoted in researching the feasibility of becoming involved in establishing my own private telephony network. To say that the obstacles are many is a gross understatement. In researching on an "in the trenches" level, it becomes totally perplexing from the standpoint that the stakes are huge, the profits are elusive, and there is a detour around every bend. For example, even if one was to deploy gateways in every major city, you still have both non-originating calls and non-termination calls that are going to route via your network. Unless you have reciprical aggreements in place covering every phone number, you will be forced to revenue share. This is where it becomes tricky. If you charge 7 cents but the layoff charge is 6 cents at termination end, you could quickly be in a red ink bath considering this doesn't even account for your billing or transactional fees. On top of this you are dealing across several possible entities that may be involved, for example ISP's, private fiber networks, RBOCs, CLECs, IXC's, etc. I have barely brushed the considerations, believe me they are endless. This would also explain why no one, I repeat no one has even started to dent the marketplace, in truth and for all practical purposes they haven't even started. At the present time most fledgling IT companies are just in the aligning stages and have yet to deploy a gateway. In other words they barely have a business plan put together as they haven't a clue how to address all the issues. You can't wing it, the cost of a mistake is to high, one miscalculation and the game is over, period. That is the reality of the negative side of the equation. Now consider why they all want to enter this quagmire called Internet Telephony. The company that can establish itself early will be the one that can write their own ticket. They will be the one that has the prime locations worldwide and as other originating calls terminate into their pops, they will have their hands out collecting. Ahh but what about those that can create a network that brings all the smaller secondary and third tier cities providers into the loop? No need to lay off anything, a stricter revenue sharing policy with quality guidelines to boot. An association standardized on one platform, one model all using similar equipment. Right now, no one has a lead, no one. As much as I'd like to say that Franklin's equipment is of high quality, so are many others. How good is good toll quality? Do you know the difference when you speak on the phone if you are talking over fiber or copper? I doubt it, toll quality is toll quality, and contrary to what some might have you believe there is a lot of very good IT equipment out there already. But that is not the point. What I'm talking about here is in establishing a global internet telephony company. Know anyone that has the plan in place? Know anyone that has the access to global pops? Know of anyone that is about to raise the capital via an IPO? This is one case that he who gets there fastest, garners the mostest. Does this guarantee success, no way. But it sure tips the scales and automatically comes with benefits that late-comers won't enjoy. I could go on and on about some of the intricate schemes I have already run into that other companies have planned, some quite good. What is really funny is the number of companies that are planning to enter this market on a very limited basis, addressing a very small niche market, yet they rant about the potential profits even that promises. I don't know who will be successful and who won't, but I can say this, the ones that know where they fit into the scheme of things early on and try not to be all things to all people will be the ones that will have the highest success rates. Consider all the segments of the long distance marketplace, even down to just corporate or residental not to mention cardcalls, callbacks, call centers, military, educational, etc. So when tapping your fingers for things to happen, remember it is a giant chess game that has to be played out on paper, with a lot of prior planning and contracts in place before the first dollar is deployed in the field. When you consider that, consider where Franklin is compared to all these other companies that read about, then remember that Franklin not only is going to supply FNET but if they get established quickly, then consider who they will bring into the fold. Put a number on it. I don't think so. I don't thing even Frank or his staff could do that at this stage of the game. And just think, all that for $5 RB