Déjà vu

Nov. 15 (Upstart)

It happened again just yesterday. I’m interviewing another ICP executive, and I ask him how his company differentiates itself from its competition. He tells me he’s got this incredible PACKET-switched network (and he says that like he’s talking about Air Force One).

Well, but a lot of ICPs have packet-switched networks, I said.

OK, he says, but we’re targeting secondary and tertiary markets. “Less competitive areas!” he says.

First of all, it kills me when CLECs say their key differentiator is their geographical hiding place from competition. Why not crystallize that in the corporate tagline? “Tier 4 Communications. We found you. We get to keep you.” “Gr@velRoad Telecom. Out here, no one can hear you switch.”

Second, it kills me when CLECs act like they’re the only company targeting lower-tier markets. I guess they’ll find out the truth once they get there.

I remind the ICP exec that his company still sounds like several others, and he says, “You’re right. None of what we’re doing is proprietary. Anyone could come along and do the same thing we’re doing.” Now if a punk trade mag journalist can shake that out of them in a short interview, you wonder how they do with investors (or for that matter, potential customers).

But the ICP follows up his last remark with, “It all comes down to our management team. This is an execution play, and our management team has the know-how and experience to do the job.” Which is, of course, what every other ICP exec says. Some of them are right, and the others are just repeating what they’ve heard.

There are plenty of ICPs out there that can clearly describe what makes them unique among their competition. But those aren’t necessarily the ones that succeed. The qualities that separate successful telecom service providers from failures are an ineffable mix of planning, management, assets and opportunity, and there doesn’t seem to be a good litmus test for discerning which companies have it.

But by failing to truly differentiate themselves in the eyes of consumers and investors, ICP clones only exacerbate the industry’s ongoing shakeout and consolidation. In a telecom network, redundancy is vital. In the marketplace, it can be fatal.

Ed Gubbins is the moderator of the Competitive Challenges discussion board. Give Ed a piece of your mind at ed_gubbins@intertec.com.