We keep hearing that telecom reform isn't happening. But what s really going on in the telecom industry today and how should customers be taking advantages of the trends?

Nolle: Reform is happening at exactly the pace expected - slow. The telecom act won't really kick in until some time in 1998. Then, the biggest impact will be on services at fractional and full T-1 levels, where copper-based provisioning is involved. There will be competition in major metro areas only, however, and the focus will be on services that cost more than $200 per month. Buyers will need to be flexible in the first three years or so (till about 2001) to take advantage of new deals. Keep contract terms short and avoid minimum carriage clauses to get discounts.

Gibbs: From my perspective - that is, as a non-telecom analysis type of guy - pricing seems to be improving most particularly for WAN data connections, making for cheap interconnect via Internet ISPs. Routing as much traffic as possible over Internet links makes a lot of sense. That includes telephony.

Heckart: There is not much for customers to take advantage of yet - at least as a result of the last attempt at reform. What any customer interested in better future prices and service provider selection needs to do today is to vote with the pocket book. Give some of the budget to the competitive service providers - especially in the local area. If you say you want choices, but always give your network to the big provider, you're perpetuating the problem. Money talks, and without revenues and customers the competitive providers won't survive.

Briere: Look, when the reform first happened we warned people not to expect it anytime soon because it'll be tied up in courts forever. This is still what we are saying. Everyone is finding out its more expensive, more complicated, more damaging, more trouble and more market-upsetting than initially imagined.

Washington classically figured it could come in and remake the industry overnight, and it was wrong. If anything, events have shown, again, that Washington has a very hard time controlling the marketplace with all the market forces at work. Ttions for security and that there would be no-fee, not even the current $50 one, in any cases involving the use of intercepted credit card information, that could send a strong message. This does not fix the companion worry about privacy, that will be harder to address.

Heckart: Not all but a lot of the security concerns are overhyped. How often do people give total strangers their credit card numbers over the phone today? How secure is this?

AT&T has the right approach in overcoming hesitation about electronic commerce with its SecureBuy program. There is no risk to the merchant or the purchaser here. This is a problem that can be 80% to 90% solved with good marketing, not technology. For some companies and some applications it will take solid technology, but for many a simple guarantee of protection and reimbursement should suffice.

Briere: I'm the worst one to talk about Internet security because everyone in my own company disagrees with me. I think it's hooey at the highest level. Yes, we need protection and control over access - we have that with our private nets. But FUD is keeping a lot of applications from moving to EC, when the downside risk is actually very small. I think people need to start experimenting now, because this is going to move very fast when it moves. People will be surprised at the differences between now and five years from now. This comes from the father of a family that orders groceries by fax and clothes by mail-order. EC has been here before -- all we are really talking about is moving it to the TV or computer, and that jump will not be as hard as many project.

Kearns: If you show people stats concerning the reliability and security of EC vs. traditional paper technologies, their eyes open very wide. This lasts about an hour. We have to keep doing it, over and over, while pointing out further advances in EC. It has to be done almost one-on-one until a large enough core group of unfearful executives emerge.

Nolle: Why do we want to? That's the first question. Do we think that EC in the sense of buying on the Internet is going to create new demand? People buy because they have money and interest, and there's probably not more than three to eight percent of new demand that the Internet could create, by being able to put buyer and seller together at the feature exploration or value exploration level. Theress no indication I can see that completing the purchase on the Internet once the stimulation of interest has occurred is really worth investing in. Does the buyer get all hot for a new product and then say, 'Shucks, my mother was frightened by an 800-number vendor so I won't call toll-free to buy this'? I don't think so. Barriers to EC are like barriers to network management purchasing - every time you knock down an objection the buyer raises another one. If they have barriers in their minds, its because they doubt the intrinsic value.

Go to the next topic...