Scott Cleland is right on with his quotes in this article about why telecom companies headquartered in the Washington, D.C. area are slipping away. A key point is that regulation cannot craft contrived competition that will survive over the long haul. The creative juices of capitalism and bright people leveraging technology will leap beyond well-meaning but ill-conceived regulation every time.
The winners will be those who own networks and have the capacity to keep current with technology. That requires deep pockets and a profitable revenue stream.
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"Why did Washington lose its leadership role?
Because Washington has lost its relevance.
Government regulation made Washington the birthplace of competition in communications, but the era when regulation determines who can provide what services to whom is past.
Many of those companies were taken down by the very government regulations that created their business. Cleland said misguided government policies triggered the telecom crash. Encouraged by Washington policymakers, too many firms built fiber-optic networks and too many decided they could compete against the local phone companies
"Telecom World War I is over," said Scott C. Cleland, chief executive of the Precursor Group, Washington's best-known telecom think tank. "This is the formal end to the era of managed competition" under government communications regulation.
Telecom's World War II is underway, Cleland said. This time it's a multi-front war between the phone companies and the cable companies, between the phone companies and the technology companies working on ways to make conventional calling obsolete, and between the phone companies and the Internet."
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