November 06, 2005
SBC's CEO just doesn't get it

If I were an SBC shareholder I would be very worried since Edward Whitacre, the CEO of SBC, quite simply does not understand the internet. As mentioned on Nikolaj Nyholms' blog (and elsewhere, one place I saw was eWeek). SBC's CEO seems to think he's in a position to charge internet information service providers like Google or Yahoo for access to SBC's DSL customers.
There's two things wrong with that. First of all, I can't imagine the DSL customers wouldn't complain or even sue that they're not getting what they're paying for. While SBC may have a stranglehold on their customers right now, by owning the copper to their homes, technology just marches on to fast for any purely tech-driven monopoly to last. Your customers have to actually like you too or they'll switch to cable or WiMax or The Next Great Thing.
Second, Whitacre seems bizarrely unaware that the model he proposes has been tried - and failed - before. Many companies tried - notably AOL. I learned how similar the AOL model was to what Whitacre proposes, and why it failed, by watching this excerpt of the Brewster Kahle interview from the PBS Nerd TV series. I learned that rest of what I needed to put together my post title from this Nerd TV excerpt with Tim O'Reilly.

Posted by Claus at November 06, 2005 10:04 PM | TrackBack (0)
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