"Telecoms has Come to the Wall" - Strategic Conference Will Hear From New Net Thinker Who Says e-Business Forces Complete Re-think of Traditional Model.

Business and Technology Editors

LONDON--(BUSINESS WIRE)--March 23, 2000

The annual strategic telecoms conference, Competitive Carrier Forces, (www.competitive-carrier.com) to be held in Montreux, Switzerland (April 5-7, 2000) will hear a series of presentations this year by new net thinker David Prior, which predicates the end of the traditional telco model.

Mr Prior, who is a senior consultant with The Phillips Group, the international comms consultancy, achieved wide recognition for his study, netpressure.com - bandwidth demand in the content economy in December 1999.

netpressure.com illustrated the impact of the Internet and IP networking technologies on the traditional carrier business model, and concluded that there were three key drivers to change: convergence, commoditisation, and co-opetition. The study predicted that the traditional telco model would be accepted as obsolete by mid-2003.

In a recent interview, Mr Prior stated that he now believes that shifts detected in his original study are the basis for much more fundamental, far-reaching changes:

"These changes are primarily concerned with mindset and business practice. Instead of just requiring changes at the business model layer, the arrival of advanced networking technologies demands changes at the very core of the telecommunications business."

He believes that a traditional telecommunications company mindset does not readily translate to the new networking model.

"I have found nextgen networks being planned now, where the core methodology for the acquisition of funding, and the calculation of return on investment, still remains constricted by talk of minute volumes and point-to-point route value. A twenty-year-old thought process is restricting `new' networks."

Other changes are imminent, particularly in the content arena. In netpressure.com, a key observation is that telecommunications service providers need to change their entire organizations to become net focused and exploit revenues from content.

"It is just no longer possible to be simply a carrier of minutes or a provider of bandwidth," says Mr Prior.

"Net players must successfully occupy one of the positions emerging, but not be tempted to revert to a monopolistic telco model. Future value lies in the content of the network, not in access to that network."

New research will also be outline at the Competitive Carrier Forces conference.

Forthcoming research from The Phillips Group will investigate the nature of the content value proposition. A recently commissioned study programme, entitled The Content Economy, will provide two multi-client studies to sponsors. In two stages, the nature of The Content Economy will be examined and the market opportunities identified. In Re-engineering Billing for The Content Economy the study will examine the feasibility of content as the new revenue source and will explore strategies for migration from the traditional model. More information on these studies is available from the programme website at http://www.contenteconomy.com

"Traditional thinking in telecommunications is coming to the wall: as e-Business radically changes commerce, so e-Everything is forcing a re-evaluation of the core elements in communications," adds Mr Prior.

The Phillips Group will be releasing a white paper entitled `Net Directions: Challenging the fundamental models in telecommunications' - it will be available free of charge to all registered delegates of the Competitive Carrier Forces conference.