“The cuckoo bird is infamous for laying its eggs in other birds’ nests. The young cuckoos grow much faster than the rightful occupants, forcing the other chicks out – if they haven’t already physically knocked the other eggs overboard. (See “brood parasitism”, here).
Analogies exist quite widely in technology – a faster-growing “tenant” sometimes pushes out the offspring of the host. Arguably Microsoft’s original Windows OS was an early “cuckoo platform” on top of IBM’s PC, removing much of IBM’s opportunity for selling additional software.
In many ways, Internet access itself has outgrown its own host: telco-provided connectivity. Originally, fixed broadband (and the first iterations of 3G mobile broadband) were supposed to support a wide variety of telco-supplied services. Various “service delivery platforms” were conceived, including IMS, yet apart from ordinary operator telephony/VoIP and some IPTV, very little emerged as saleable services.
Instead, Internet access – which started using dial-up modems and normal phone lines before ADSL and cable and 3G/4G were deployed – has been the interloping bird which has thrived in the broadband nest instead of telcos’ own services. It’s interesting to go back and look at the 2000-era projections for walled-garden, non-Internet services.
The problem is that everyone wants to be a platform player. And when you’re building and scaling a new potential platform, it’s really hard to turn down a large and influential “anchor tenant”, even if you worry it might ultimately turn out to be a Trojan Horse (apologies for the mixed metaphor). You need the scale, the validation, and the draw for other developers and partners.
This is why the most successful platforms are always the one which have one of their own products as the key user. It reduces the cannibalisation risk. Office is the anchor tenant on Windows. iTunes, iMessage and the camera app are anchors on iOS. Amazon.com is the anchor tenant for AWS.
Unfortunately, the telecoms industry looks like it will have to learn a(nother) tough lesson or two about “cuckoo platforms”.”
Dean Bubley from Disruptive Wireless.
The link above provides some really interesting perspectives from Dean in relation to OTT business models and the challenges that telcos have faced in trying to build valuable platforms to sit on top of their capital-intensive network platforms. I really recommend having a read of the full article by clicking on the link.
I loosely equate this to the OSI stack where telcos own the L1 to L2 (L3 in many cases) platform, but haven’t been so successful at creating dominant platforms in the layers above that. That’s also why there are two distinct business model categories – the traditional CSP (Communications Service Provider) that services L1 to 2/3 and acts like a utility or REIT or the more competitive DSP (Digital Service Provider). One Telco group can have both by leveraging their trillion dollar treasure chest.
Traditional OSS service the CSP (as well as some of the aspects of the DSP model) but we probably need to create some innovative new concepts if we’re going to assist our telco customers to build DSP platforms and / or to keep the cuckoos out of the nest.
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