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Long DistanceThere are many people who know much more than I do about telecommunications and I am really pleased that a few of them at IBM offered some feedback on my latest story about "long distance".
First, thanks to Mike Nelson, formerly Director of Technology Policy at the Office of Plans and Policy at the FCC, for pointing out the typo I made about the cost of Skype. Most phone calls are .017 Euros (about two cents) per minute. (story updated).
Secondly, thanks to Stu Feldman, formerly Technical Leader of the Telecommunications Information Networking Architecture Consortium (TINA-C) and a long-time veteran at both Bellcore and Bell Labs, for reminding me that some non-trivial fraction the Verizon phone bill goes toward subsidizing the costs of supplying telephone service to rural subscribers who live far out from population centers and can not afford traditional wire-based services, let alone the more profitable incremental services such as call waiting, caller ID, etc. As for the cost of legal overhead, Stu points out that these may become "stranded costs" as users move to different technologies and companies, such as voice over the Internet and Skype.
Finally, thanks to Laurent Hayem in Paris. Laurent has worked in the area of the cost and operations in telecommunications, telephony, voice over IP, and call centers. He has been analyzing various telecom bills and new offerings in Europe and has observed that a split is emerging between FIXED and MOBILE. What he is referring to is that the wired infrastructure has a relatively fixed cost structure and the subscription model is moving in the same direction; i.e. an "all you can eat" price that includes local, long distance, and related services. The mobile model is considered more of a high value-add service and therefore has higher and use-oriented rates. It remains to be seen whether this will continue to be true as we get more and more handheld devices with WiFi in them. Laurent also suggested that Broadband VideoPhones may soon become as natural to use as Skype. The D-Link DVC-2000 is an early example of the technology. Just as Skype takes us all to a new level by allowing us to hear someone at the other end of the Net, the Broadband VideoPhone will allow us to see the person. The idea of the "Picture Phone" has been around for decades but now that high speed, standards-based, communications (the Internet) is becoming pervasive and lower in cost, the "vision" will finally happen.