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Carriers may suffer the fate of newspapers with Internet telephony

If wireless carriers allow competing Internet telephony services over their networks, they risk suffering the same fame as newspapers today. The nightmare scenario of Trojan horse and dumb pipes is within grasp of reality.
Common sense dictates that a business will not let a competitor brand or service access its distribution channel to reach end-customers offering the same type of service. Yet that is what carriers such as Verizon Wireless, T-Mobile, Sprint and now AT&T are doing to themselves.
While a resurgent Federal Communications Commission is busy speaking up for consumers, one of the unintentional consequences of its newfound activism is ?convincing? carriers to allow services that offer long-distance Internet telephony to run on the same wireless networks.
In other words, Google Voice may soon be able to run on AT&T?s network, as it is on other networks. Google Voice offers the same services as AT&T does: the ability to place and receive calls, albeit using the Web. Now that doesn?t make any business sense for a network to willingly allow a Trojan horse in its ranks.
Let?s turn the tables. How would Google ? accounting for almost three out of four searches online ? react if the FCC asked the search giant to run Microsoft?s Bing or Yahoo?s search box on its homepage? One word: outrage. Another word: lawsuit.
And yet carriers are being forced into this awkward position of offering Internet telephony services through Web and applications accessed over their networks. The chickens will come home to roost, as newspapers have already discovered to their dismay.

<b>Nooseprint<b>
As is well-chronicled, newspapers in the past decade offered all their content for free on the Internet, while continuing to charge for print editions. The justification in the 1990s and even up until three years ago was building a sizable online audience against which to sell advertising.  
Well, what the newspapers discovered was the audience numbers did swell online. However, that growth was a shift in eyeballs, and not incremental as was hoped.
Any reader with common sense soon figured out why pay for a news product that was free in one medium ? the Internet ? and updated regularly, versus paying for a static print product. Add to that the simple fact that most news today is a commodity, making it harder to charge for content online.
The end result is for all to see.
A similar exercise to charge for mobile news may face the same fate ? unless all media outlets unite and draw the bridge on free Web news. But that would invite charges of anticompetitive practices and ugly lawsuits.
Media brands are groping for a strategy to survive. Older organizations have built their revenue models around mostly print advertising and some circulation revenue ? never a major draw other than an indicator of guaranteed circulation rate base.
That old model is collapsing quicker than a deck of cards.
Advertisers are fleeing print, but not migrating that entire spend online. Internet advertising alone cannot support a newsroom, ad sales force and backend operations. Plus, most news is a commodity, available through hundreds, if not thousands, of avenues.
News Corp. chairman/CEO Rupert Murdoch?s idea of gating news online has little chance of working. Subscription revenues never did support a news brand in print and nor will they sustain an online outlet either.
On the contrary, fewer eyeballs online will mean fewer impressions and fewer click-throughs on articles and advertisements. Consequently, advertising performance will worsen and advertisers will soon shift spends to other media.
<b>Hyper over Skypers<b>
Carriers must learn from newspapers. They cannot let themselves become dumb pipes. To allow companies such as Google or Skype to offer Internet telephony over their networks is business suicide, threatening their bread-and-butter source of revenue.
Indeed, why would consumers opt for elaborate calling and data plans with a carrier if all they need is a VoIP appl