Fergie's Tech Blog

Can telecoms wring profit from enterprise IP?

This is indeed an interesting conundrum for IP services--although they seem to be extremely popular, there is a question on their profitability.

Marguerite Reardon writes on C|Net News:

This is an era of mixed blessings for two of the nation's biggest phone companies.

AT&T and MCI not only are grappling with the mix of promise and regulatory issues associated with their respective acquisitions by SBC and Verizon, they are finding it difficult to make money off some of their fastest-growing IP services.

At the heart of the problem are the relatively thin profit margins on the telcos' sales of enterprise-data IP services such as Internet protocol virtual private networks (IP VPNs). The remedy, experts say, is fairly straightforward but not necessarily easy to implement: The phone companies need to develop and sell more add-on IP VPN products and services to boost their returns.

posted by Fergie @ 5/18/2005 06:45:00 AM