Just as the Internet bubble was about to burst I was lured away (those were the days of signing bonuses) from a successful post-IPO startup to go to work for a telecommunications software company developing a new set of software tools for developing new telecommunications “services” (this was before apps).  Up until then, and still sometime after, companies like Lucent and Northern Telecom had a lock on the market for developing new service offerings (e.g. Texting, web surfing with WAP browsers, etc.) and would charge telco service providers enormous sums of money to develop even the most basic of new offerings for their customers.

This particular company was deeply involved in supporting the guts of the telecommunications networks based on a standard called SS7.  By supporting the emergence of a new standard for developing telco services would enable the company to move up the software stack with their telco customers.  Thanks the the telecommunications act of 1996 the opportunity seemed huge.

After a few months of meeting with the internal development teams and traveling the world meeting with current and potential customers it became apparent to me that the market was not yet ready for such a dramatic change.  I reported my findings to the CEO who was none too pleased since he had already placed a pretty big bet on this new market without really doing his homework.  I did what I could to help them salvage their investment and started looking for another job.

As it turns out a co-worker at the company who had been working in telco for many years agreed with my assessment of the non-emergent market.  Soon after delivering the bad news to the CEO he approached me about join him at a new telco centric startup…which I did.

By this time the internet bubble had fully burst and the market for new tech took a major hit. This new company had taken in a good amount of funding at exactly the wrong time and was under a great deal of pressure from investors.  They did their best to salvage what they could to enter different markets than had been originally planned until they ultimately closed the doors.

My primary take away from this brief tour through the telco sector was that software that runs our telecommunications networks is incredibly complex. The software developers and engineers that understand this world are few and far between…and they are really smart. 99.999% (aka five nines) availability of the telecommunications network is an absolute requirement as any downtime would cause havoc amongst customers and commerce and could potentially compromise national security.  Heady stuff to be sure which is why this world is incredibly hesitant to adopt change. But alas, they must.

IoT takes John Gage’s quote “The Network is The Computer” to a whole new level; without ubiquitous and dynamic mobile connectivity there is no IoT.  Consider the following:

• The major telcos (Verizon, AT&T, etc.) own the keys to the kingdom and they want an increasingly larger percentage of the enterprise IT and cloud services business.
• Established systems integrators will increasingly find themselves in co-opitition with their telco partners and will need to develop partnerships and tools to protect their positions in the enterprise.
• Alliances between SI’s and Cloud/Hosting companies will continue to grow…but they still will not own the network.

Companies that can provide software development tools that can abstract the complexities of the telecommunications components of Enterprise IoT will be amongst the first to cash in on the multi-kabillion dollar IoT market.  I will be watching this segment with great interest…stay tuned.