The Paradox of the best Network.

“ Communications networks have a more important job than generating return on investment — their value comes from their connectivity and from the services they enable. Therefore, the best network delivers bits in the largest volumes at the fastest speeds. In addition, the best network is the most open to new communications services; it closes off the fewest futures and elicits the most innovation.”


The Communist way of planning our life is theoretically the best, since it planes a world where everybody gives the same and gets the same.
But in reality a society like that doesn’t give anybody the incentive to produce, to follow progress.
It condemns the economy to stagnation.
Ideals are wonderful goals, but the filling of our belly is a better one.

In the same way, communications networks live and increase their value proportionally to their ROI, just like everything else on this World.
If a man cannot make a profit out of his job, very rarely he works.

It is true their value is increased by the content they deliver.
Without good content they have no reason to exist.
The fast lines own their success to the P2P Napster downloading.
Without that who would have needed a faster line?
It certainly wouldn’t have become in such a short time a Mass Market.

And without any doubt VoIP is a good content for a Communication Network.

“Designing a network that is intelligently tuned (optimized) for a particular type of data or service — such as TV or financial transactions — inevitably makes that network less open. As software engineers say, "Today's optimization is tomorrow's bottleneck." Thus, the best network is a “stupid” network that does nothing but move bits.2 Only then is the network truly open to any and all services that want to use it, no matter how innovative or how unexpected. In the best network, the services live at the edges of the network and use the network to transport bits; they do not rely on any special characteristics of the network itself. “

The best network is like the Post Office.
Its value is proportionally important to the good it delivers.
If it is a Merry Christmas card its value is a little more than Zero, but if it is an important Paper, its value can be much, much more.
Nevertheless, the cost of transporting a card or an important document is the same.
What gives value is what is at the edges.

But if the Postal service is lousy, it also decreases the value of the edges.



“The Paradox of the Best Network comes about because as a network gets stupider, connectivity becomes a commodity. Those who own and operate the network have less to charge for. After all, they’re just moving bits. The high-value services, the ones that command premium prices, reside at the edge of the best network. Because the best network is simple, it is low-cost to operate. In a competitive market, this means it is low priced. Low price also lowers barriers to innovation at the edges of the best network. “

Low price of transportation makes more things affordable.
If downloading an ebook is very cheap it makes it easier than sending the real book (and so competitive with the old publishing world)

“The telephone companies are impaled on the horns of this dilemma. Historically, their high-margin services have been built into the middle of their network, which has been optimized for a single application — voice. Their business is based on this special-purpose network. They know that implementing the new commodity network threatens the very basis of their business.”


“But, the real threat to the incumbent telephone companies isn’t the Internet. It’s the Paradox of the Best Network. The paradox means that companies that run the old, closed, special-purpose telephone network have an unfit business model for running the new network. No amount of technological upgrading will fix this. To survive, the incumbents must become different businesses. But there’s no guarantee that they'll be the best companies to run the best network. “

The paradox is not in the business model. Where it is convenient, for example long distance calls, the “Incumbents” have already adopted VoIP.
Their threat is in the fact that a Gatekeeper that a few years ago cost hundreds of thousands dollars nowadays has a competitor in a gatekeeper that costs 1000 dollars and may be does a better job.
That means that for doing their business you do not need to be a big company with thousands of employees, but just a one man company, with a very little investment “smart people against dumb companies”.

I do not think that they are “dumb” I think they perfectly understand what the Future will be and they also understand that in the Future there is no place for a Company with thousands of employees and expensive premises.
A one man company with a good PC can theoretically do more than a big one.
And that will happen also very soon with movies, TV, music.
With a good software one only man can play an orchestra, with a cheap digital camera be the director of a successful movie.

All of this is possible thanks to the Revolution of the PC and the Internet.
With one you produce (voice into packets and vice versa) (a movie, or a song) and with the other you “transport” and “broadcast” it.

The real revolutionary thing in the French revolution was the change of the “Market’s Players”.
Instead of one King and a bunch of “nobility”, new active, smart, players came on the scene: The bourgeoisie”



“But the best network is the hardest to make money running. So who builds it? Who runs it? Who fixes it when it breaks? And who develops the next generations of faster, simpler infrastructure?

Arguably, building the best network is a Public Good. It will boost the economy, open global markets, and make us better informed citizens, customers and business people. So, perhaps we should let the government do it. Perhaps we should insist that the government do it.”

No, please. Governments proved to be a King Mida at the reverse.
Instead of changing everything they touched in gold, they made it in something else I do not want to say, because it is a bad word.

“A purely governmental solution, therefore, is too risky. But so is a pure reliance on the invisible hand of the market. Left to itself, the market would favor larger network owners both because they benefit from economies of scale (the more connections you provide, the lower each connection costs) and because they have financial resources to withstand the low operating margins of a commoditized market. Even starting from a mythical "level playing field," larger network owners would acquire smaller ones. And once again, large carriers would become monopoly-like, with little incentive to hook up less-populous and poorer areas. More important, these regenerated monopolies would be as loathe to open their network or to invest in new technology as the current crop of telephone company incumbents. The Paradox of the Best Network is not resolved by the free market; indeed it is a consequence of it. “

The Internet is the “Network of Networks”.
Let it be this way.
Let many privately owned Networks be connected in one big Network.
Let it be the only, real Democratic country in a World of Tyrannical governments and oligarchies.

Let the Smart people win over the Dumb companies.
Let’s build the “Customers’ owned infrastructures”

This is the Future of the Communications Network.

Patrizia from a World on IP