Inverting Telephony

Ari Jaaksi, open source champion here in Nokia, gave a keynote speech at the 2008 Open Source in Mobile (OSiM) conference that revealed a few tasty tidbits of what's to come with Maemo and the internet tablets. The essentials are divulged in his public blog.

The one upcoming advent that has generated significant polarized discussion on and off line is the support for High-Speed Packet Access (HSPA). While so far that support is said to be limited to data traffic (i.e., no cellular voice service), Voice over IP (VoIP) is still an option-- and suddenly an even more attractive one for many people in some areas. Can we now say "Internet Everywhere"?

Currently VoIP (also known as IP telephony) is the geeky little brother to what's commonly called "plain old telephone service", or POTS for the acronym-happy. It has carved out a solid niche market that doesn't currently show any real signs of major disruption.

But all that is bound to change, and sooner than some might like. In the old telephony model, digital IP services ran on top of an analog infrastructure. Think of it as "IP over Voice". Purists would call it a kludged solution. However, the bulk of that infrastructure has been recast as digital in short order. Ironically, some developing regions enjoyed digital service before pioneering regions because they were not reached until very recently, after analog was being phased out. Consequently, it should not be as difficult for them to embrace new developments (added)

In the new flipped model to be, IP will be the telephony foundation. Suddenly VoIP makes more sense, in this environ, than POTS. It's faster, more efficient, and capable of greater bandwidth. Present problems with reliability (at least in the US) should straighten out once the digitization is 100% complete.

This brave new communications model threatens the status quo of current telephony service providers. The internet would support a vast open market where anyone, anywhere could provide your phone service. Proprietary VoIP offerings like Skype aside, SIP-based solutions would make the market feasible. Theoretically, he with the best servers (and of course, last-mile delivery) wins. Given Google's phone ventures combined with their idea to float servers on the ocean, they start to look like the true threat to the telcos... especially if they ever choose to do so in international waters (revised).

And I don't expect the carriers to move fast enough to address the changing game. In the US, they have already proven themselves, with only minor exceptions, highly resistant to such change. So besides Google, does Vonage stand to eventually unseat Verizon as king of US phone service? I realize that sounds improbable, but then, how long ago was it that a monolithic AT&T had the vast majority of our market locked down tight?

As loathe as I am to say this, legislative and regulatory bodies may have to step in at some near future point to resolve sticky issues of cross-provider access. I fully expect Skype to eventually wither on the vine, but that won't preclude surviving VoIP providers from erecting walled gardens of their own. Somehow, IP telephony needs to be as ubiquitous and hassle-free as POTS. I expect it to happen, but how rough will the transition to be?

At least Nokia is positioning itself properly, I think, to be an important game-changer here. How exciting that a former skunkworks project like the internet tablets now stands to benefit from and even drive the impending telephony disruption! As nervous as I am today, I can't wait to see what's to come...