I’m at day 2 of the TC2.0 brainstorm in London. Firstly, no free wifi, which seems completely dissonant with the TC2.0 “ride the future” message and rather irritating. Set-up is good - on each roundtable there’s a couple of terminals for sending questions, adding comments and completing polls. Lots of stimulating speakers and participants.

Now to the juice. What’s the premise of the conference? Actually, there isn’t one, which isn’t quite what I was expecting. There’s a question - “how to make money in an IP world”. In other words, in an IP world, anyone with an IP connection can conceivably offer services to digital consumers and therefore threaten traditional telco revenues. This is already happening, such as Skype, which gives free voice calls over the Internet.

Are there any answers? Apparently not. Just more questions, judging by the inputs from the terminals. The question is really how to make money with services other than voice and messaging in an already saturated market. The simple answer is to innovate, not just in technology, but in business approach, hence “this is the year of the innovative business model”. That’s obviously easy to say, but not to do. In fact, the first presenter (James Enck) gave all the telcos a bloody nose by suggesting that they probably just don’t have the right “DNA” to solve the problem. In essence, they are seen by investors as being akin to utilities companies and should “stick to their knitting” and not even attempt this innovation stuff.

Listening to the presenters today, I kept thinking that I was missing something. Everyone seemed to be talking about the problem and seemingly giving us “insights”, whether from the bowels of a telco, the mind of an analyst or the blatant sales pitch of a sales person. I wondered if it’s a bit like the whole Web 2.0 theme, or is that meme? I think meme. It keeps going round and round and picking up buzzwords by the minute, most likely starting with Ajax, perpetual beta, then social networking, then UGC and on it goes, ending up as basically everything that we weren’t really doing so much of yesterday. In other words, Web 2.0 = NOT Web 1.0, which is the kind of anti-definition familiar to cults. What are you? We are not them!

In other words, Telco 2.0 is not Telco 1.0, which is yesterday’s business model. We then start to add in some new stuff, which might have 2.0 in it anyway, like Web 2.0, and “open API” and so on and we slowly end up with Telco 2.0. It reminds me of a “meta analysis” whereby lots of ideas and data don’t mean much individually, but appear to add up to something. The problem with this is that meta-analysis only works by observation after the fact, whereas it seems that the Telcos in attendance want to know the ideas first, quite naturally so. The telling slide was the “tipping point” one where a bunch of ideas that might tip the industry into a new era were all voted on (at the last brainstorm) to gather consensus about when they would happen. However, no one could say which potential tipping point was worth tracking and which would occur first. By their very nature, at least according to how Gladwell defined them, no one knows when a tipping point is going to occur or how, which was why his book was fairly useless for those expecting it to reveal the secrets of tipping.

If all this is sounding like fluff, then perhaps it is, but that’s definitely how it comes across to Telcos who have been used to hard and fast ways of doing business, like building more of the same network to get more capacity and then go grab the customers. This no longer works, as typified by what one session called “The Broadband Incentive Problem”. This problem is that before long, mostly thanks to a handful of data-hungry users, the broadband pipes will reach capacity but without generating additional revenues. Therefore, there is no incentive to invest in increasing capacity.

So there was no premise and little in the way of substance to suggest any answers to the “future” question. And therein lies the problem, or so it seems to me. The confusion, if there is one, seems to be that the basic problem is that all this “analysis” is about trying to guess the future. Mostly, we ain’t good at that sort of thing. Moreover, there seems to be a mistaken assumption that utility telco companies can somehow transform themselves into something else simply by moving up or down the value chain. This might be a poor assumption, as suggested by the first speaker, which was the bloodying of noses part. I guess if we think of the water companies, they are good (or not so good - the water “shortage” problem in the UK) at the supply of water. However, it would be folly to assume that they could move into any of the industries that happen to use lots of water, such as silicon chips. They might be able to move into gas distribution I supposed, as there are a number of similarities, but not silicon chips or chemical production etc. By the same token, telcos can’t magically become “youth brands” and move into hip youth services. But let’s see. Today I’m in the Digital Youth track.