Goodbye convergence

Buzzwords in the telecom industry often have the life span of mayflies. Sometimes, buzzwords die a fast, spectacular and fiery death (consider "switched digital video"). Others linger in a sort of purgatory, waiting to be rescued but instead quietly fading away... which brings us to "convergence."

To place an exact date on the term's use is impossible, but convergence came into fashion around the time Time Warner conducted its overly ambitious trials in Orlando - sometime before 1996. At that time, the soon-to-be AOL subsidiary was pushing voice, some forms of data and video over a single network. Despite the gee-whiz reaction Time Warner got from the trial, the network's cost and consumers' unwillingness to pay for the service doomed the trial from morphing into a commercial offering. However, it gave birth to the general use of the term convergence.

Though its meaning has changed to suit specific company situations and general market conditions, convergence represents the coming together of all forms of current communications services - voice, data and video - from one provider. More important, it indicates that these services are supposed to be delivered via a single wire into the home, via coax from cable operators or the twisted copper pair from telcos. Residential overbuilders had the business plans but, more often than not, got caught in a financial squeeze by underestimating the costs of building out their own networks.

If convergence isn't dead, it certainly is gasping for air.

Not that there haven't been attempts at convergence from all varieties of carriers. On the telco side of the much-imagined impending convergence battle between telcos and cable operators, virtually every large carrier (and many smaller ones) has taken at least a flailing swing at the idea.

Bell Atlantic dumped big coins into a headend of the future in New Jersey, anticipating a major push into convergence that would include interactive TV and high-speed Internet access. Today, it sits as a monument to excessive ambition, serving a few thousand customers and filled with equipment that is still useful but certainly not worth an exorbitant price in the secondary market.

SBC, at one point, began a trial of video technologies in Richardson, Texas, that had the promise of bringing converged services to residential users. It promptly shut it down a few years ago when cable operators began questioning the wisdom of entering the voice market. Likewise, SBC's acquired cable plant from Ameritech and SNET has been on the auction block for some time, despite promises made during the merger's regulatory review period.

Even BellSouth, which looked to be the last holdout among telcos in the video market, appears to be slowing its march toward convergence.

Today, both SBC's and Bell Atlantic's convergence strategies consist of voice on one line, DSL service on another set or two of copper pairs and video via the resale of DirecTV. That convergence strategy is akin to putting ham and bacon together on a plate and claiming you have a pig.

Recently, SBC and Verizon publicly stated their desire to unload their remaining cable assets. That only drives home the point that they have completely jumped off the convergence bandwagon.

Ironically, with AT&T now creeping into incumbent telco territory with its own interpretation of convergence, some smaller carriers are jumping on the convergence train on its second go-around. Telcos such as Hart Telephone, Chibardun Tel and Horizon-Chillicothe Tel could end up being what amounts to the leaders in the telco convergence market.

In some ex-urban or small town markets, telcos are offering something that resembles converged services. But more often than not, the competitive entities are battling larger incumbents that would just as soon shed the rural exchange.

Convergence, where have you gone?