Friday, October 23, 2009
The Way of Strategy (#23): Knowing the Grand Settings
"Know the enemy, know yourself; your victory will never be endangered. Know the ground, know the weather; your victory will then be total." - Art of War
Knowing the rules of the competition is one of the first few steps of game strategy. ...
The quality of one's leverage determines whether the opposition will attempt to utilize the rules against you. If they can't use those rules, they find a way to change it.
In business competition, the act of fairness does not exist. It is a deceptive belief that most naive and innocent businessmen and women get lured into.
One should always know the rules and the history of the arena that he/she is competing in.
September 25, 2009, 6:58 pm
AT&T Says Google Voice Violates Net Neutrality Principles
By Saul Hansell
Policy and Law
AT&T is playing a “gotcha” with Google. The big phone company filed a letter with the Federal Communications Commission Friday saying the Google Voice calling system violates the commission’s network neutrality principles.
At issue is Google’s decision not to connect Google Voice customers to certain conference calling and other lines because of what it says are excessive access charges by the providers of those lines. AT&T, which is required to connect its telephones to all lines, says Google is discriminating against certain uses of its network, a no-no in the network neutrality world.
Google, meanwhile, says it doesn’t have to follow the same rules AT&T does.
Whether AT&T is right depends on all sorts of technical interpretations of the commission’s policies and which regulations actually apply to Google Voice, which is a technological patchwork of telephone calling and Internet communication.
But that really isn’t AT&T’s primary concern. The company is mainly trying to score some debating points and show that sometimes companies have good reason to treat some uses of their networks differently than others. (If you do want to get into the policy minutiae, start with this post from the public-interest telecom lawyer Harold Feld .)
What AT&T and Google agree on is that the system for exchanging payments between phone companies for completing long-distance calls is deeply flawed. I looked into this last year, when Kevin Martin, then the F.C.C. chairman, wanted to reform what is called intercarrier compensation. After a week trying to understand those rules, I ran away screaming. Our long-distance system is so topsy-turvy that it makes the Mad Hatter’s tea party look like drill time at West Point.
But to simplify it as much as possible: When your long-distance company connects your call to a telephone served by a different company, it pays a fee to terminate the call. This fee can range from almost nothing to as much as 7 cents a minute. The difference is set by a number of factors, including state regulatory regimes. In most cases, those access charges far exceed the actual cost of completing a long-distance call, and every telephone user pays higher bills because of these charges.
So why do these charges exist? Originally, they were to subsidize service in sparsely populated areas, and they are still defended by the largely rural phone companies that benefit from them, many of which have allies in Congress. (Those phone companies get a number of other subsidies, too.)
Meanwhile, some enterprising phone companies, aided by local regulators, have taken to encouraging entrepreneurs to set up businesses that attract lots of inbound calls. Those include the free conference calling services, free fax lines and telephone pornography. The phone companies rebate some of the high call termination fees they receive to the companies running these services.
Maybe the commission will decide that Google, since it is turning into a telephone company, will need to connect to those lines and pay the fees. Maybe it will agree with Google’s argument that its services are different enough to be exempt from the rules AT&T follows. But consumers would benefit most if the commission used this as another prod to do the difficult work of bringing some rationality to the way that long-distance calling is priced.