Global versus local, or “outside footprint versus inside footprint,” now is becoming a bigger strategic issue in the communications business, in ways beyond the obvious move of carriers into new international markets.
In fact, the “sell outside my existing footprint” trend has been seen for the last 20 years, even for suppliers who operate only regionally in the U.S. market.
The basic change is simple to describe. In the past, service providers have sold services to potential customers only in certain defined geographic areas. That limitation was imposed by regulators who authorized operations within a city (cable TV franchises, for example); regions (the seven Baby Bells created in the wake of the Bell system breakup in 1984) or parts of a city or community (competitive local exchange carriers who sell only to some business customers).
Increasingly, in the cloud computing era, apps and services are sold nationally or internationally, with fewer restrictions than in the past, even if national regulators still are important.
When incumbent telcos created CLEC business units to sell outside their geographic footprints, that is one example of the trend. Cable TV companies traditionally do not compete with each other.
But mobile is going to change that relationship, for the first time. In principle, a Comcast or Charter Communications selling mobile service, even if initially focused on “in region” customers, is in a “national” business, and eventually will move in that direction, by necessity.
AT&T and Verizon both believe they will be able to leverage new 5G network capabilities to sell “fixed network services” even outside their geographic footprints, operating as CLECs.
So the strategic context changes. In the past, the effort has been to create services to sell to potential customers “who live or work in my footprint.” We are moving increasingly towards a market where it is possible and desirable to sell apps and services to people and businesses “outside” the legacy geographic areas.
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