William Quigley, managing partner of Clearstone Venture Partners, is going to give a view of where he thinks the opportunities are.
We’re in a time of transition. A whole new set of players are emerging as competitors, and after a long hiatus, investors are returning to Telecom.
The top 5 Global Internet Market Cap Leaders are Google, Yahoo, Ebay, Yahoo Japan, and Amazon. With $280B in market cap, these are going to be the players. They understand applications in a way the telecom players don’t.
VC’s are investing big dollars in telecom today because there is so much still undecided. The most valuable companies are the contrarian companies that turn out to be right.
William thinks the RBOCs are going to be around for a long time. They have two choices: reinvest, or defend the kingdom. Rightly or wrongly, they’ve decided to defend the kingdom. They’re investing, primarily in fibre to the home, and that will let these carriers start to offer quad plays and so on.
He sees a big opportunity in VoWLAN (mobile VoIP). A big impediment has been the cost of dual mode phones, which are now much more affordable and available. Mobile minutes are highly price elastic. Usage is going to skyrocket when VoWLAN makes the cost of those minutes close to zero.
Fixed mobile convergence is being driven by the fact that 86% of employees spend at least one day outside of the office. 35% of calls are intra office. Learnings from their FMC deployments: the rollout is not like RIM, ROI is impressive but not the driver, and if the enterprise is committed to VoIP then VoWLAN and FMC are next.
Applications drive value in the VoIP network. Software is becoming the dominating factor for adding value, which is great for startups.
A non-consensus bet: CBeyond. Started in 2001, all IP, voice and managed services and now a $200M run rate with 70% gross margins.