CMO details Alcatel-Lucent's strategy, future vision

Last week, Alcatel-Lucent’s new chief executive officer spelled out a new strategy for the equipment vendor. Part of that strategy was a focus on improving the role that telecom service providers play in a world of over-the-top Internet applications and services. But while the CEO didn’t delve too deeply into the specifics of that aspect of the company’s strategy in last week’s presentation, the company’s chief marketing officer, Tim Krause, provided more detail in an interview with Telephony today. In Part 1 of this 2-part interview, Krause laid out Alcatel-Lucent’s image for the future of service provider networks. In Part 2, he’ll explain how we get there from here.

On over-the-top applications enablement: This was a complicated story to try to tell; it’s a complicated problem that will simplify over time. The issue really does boil down to trust. There are a lot of apps we use on the Net today that we wouldn't use except that someone has provided app enablement in the form of trust. PayPal, for example, doesn’t provide an end service but opens up trust for an eBay seller and an eBay buyer. Another example is Akamai’s content delivery network; they don’t really provide the end service, but they make the end service work. The over-the-top [app] guys are doing this a little already with cloud computing. Even Google has said, ‘I’m too slow, even for my own uses. I want to be able to leverage the speed of others.’ They opened up their platforms with standard Web [app program interfaces (APIs)], making available to anyone the ability to create new apps that consume Google capabilities and services. There are lot of places service providers could do the same thing.

On telecom carriers’ role: Take YouTube, where all the video is free but pretty low quality. You don’t have Desperate Housewives on YouTube because content owners won’t allow it because they won’t get paid for it. Consumers tend not to watch it on there unless it’s free because the quality is so low. YouTube users do pay for high-quality streams; they just don’t pay YouTube. They’ll pay $2 for Desperate Housewives because it’s great quality and comes right to their home. The limitation is you have to buy a relatively expensive device. In the YouTube example, [telecom service providers] could go to a content owner and say, “I’ll make sure you get paid. I’ll manage the digital rights in the network, and when a consumer consumes it, I’ll take care of it on their phone bill. They’ll pay me, and I’ll ensure you get paid. Secondly, I’ll make sure your content, when you give it one time to YouTube, gets transcoded into any format, whether it’s a Samsung handset, an iPhone or any other handset in between. I’ll make sure it has the right fit and form for the screen it’s going to be consumed on. And if you want, I’ll make sure it’s really high quality. If we do that for you, you'll have access to millions of subscribers you never had before.” And the end user now has access to content they’ve never had access to before because they couldn't afford the device or it wasn’t available enough. So you've unlocked this sort of millions-to-millions idea; you've put some value in there. And only the [telecom carrier] can deliver that capability. In the last couple days, Google has been saying to telcos, “We’d like to work with you on having a superhighway to subscribers on your network.” Only [telecom] service providers could expose a guaranteed quality of service to make that happen.