Verizon CEO exiting one dying business for another

The NY Times reports that Verizon CEO Ivan Seidenberg has finally accepted that his landline business is going to keep sliding:

Mr. Seidenberg said that his “thinking has matured” and that trying to predict when the company would stop losing voice landlines “is like the dog chasing the bus.”

This is being touted as the most progressive thing anyone has ever heard (which might be true, coming from a telecom exec), but the irony is this:

“Video is going to be the core product in the fixed-line business,” Mr. Seidenberg declared. And the focus will move from selling bundles of video and landline to video and cellphones, he added.

That’s freaking hilarious. Verizon thinks video will replace all their landline revenue losses. They are jumping into Video just as it is approaching its end of life, or the beginning of the end anyway. People are starting to “cut their video cord” just as they began cutting their landline cord a few years ago.

My son’s dorm room at college includes a landline phone, Internet, and a cable TV connection. They actually have a phone plugged into the landline (probably mostly to talk to the school’s internal numbers, like the I.T. dept to keep the Internet working). They do not have a TV and don’t have anything connected to the CATV wall jack – and they don’t seem to miss it much.

Over the years to come, there will be as many people dropping Verizon’s video service as there are people dropping landlines today.  So this seemingly “progressive” view is sort of like saying we’re finally abandoning Betamax and embracing HD DVD!

5 comments for “Verizon CEO exiting one dying business for another

  1. Excellent points – I posted similar last night. But your point about video dying is right on.

    I’ve been using Boxee lately – I fear for the future of cable and satellite with Boxee coming.

    Dave Michels

  2. I agree too. Your dorm example is also one I know well. Although my son would have to pay to have cable TV. All his TV watching is via a PC via various websites onto a TV that is used primarily for gaming. I too enjoy for Hulu and Boxee. There is no shortage of content. I recently paid for one more year on my Tivo. My daughter uses it most. Next year it will be retired. I don’t expect to need another.

  3. I think people may still have TVs but a lot won’t have “TV service” as we know it (whether Cable, Satellite or FIOS).

    I have a Mac Mini driving my TV using Youtube, Boxee, Hulu, Netflix etc. It’s not quite mainstream-ready but the steps from here to there are clear and will happen. I have a blog post coming on this “dropping TV” topic.

  4. Streaming video I believe is the next “big” driver of bandwidth. Broadband penetration in this country is always a crazy discussion for those of us in this industry – I think the bigger discussion should be on quality broadband in those areas that can get it, not areas that can’t get high speed connections. People and businesses are willing to pay Verizon and other bandwidth providers more money for the ability to download bigger and clearer video streams and to allow for larger bandwidth business applications. The copper business is dead, at least in the 50 football cities – but alive and well in Kansas (rural America) Dorthy.

  5. verizon will be delivering video content. but not as a separate service. rather their pipes will be used to deliver web video. but i believe that even FIOS will not be as popular as expected. people will sacrifice quite a bit in speed for an entirely wireless life. the future of the internet is all 3g/4g cellular, WiMAX and WiFi.

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