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Technology Stocks : The *NEW* Frank Coluccio Technology Forum

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From: Frank A. Coluccio8/16/2009 10:52:38 PM
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[Opinion:] Who Pays for All This?
Dr. Barry Sullivan, IEC | Aug 16 2009

We seem to live in an era of broken business models. The stress test of an economic crisis will expose weaknesses that go unnoticed in better times, which might lead one to expect a surge in the rate of bad assumptions and false premises detected in times like these. That may be true, but it doesn't answer how we pay for the things we thought we had covered.


FAC: So what do you think? Has the author a good point, or has he been standing much too close to the Kool Aid stand for too long a period of time? Is there a problem with the industry model that he's not facing up to? Me thinks there is. It's called the onerous overhead of back-office billing and scarcity-management systems, where tens of billions are spent annually across the sector to support a model whose time has passed, and without which new opportunities for profitability might easily, in fact I'm certain that in many cases would, emerge. But who is going to be the first large operator to risk tossing out billions of dollars worth of back office systems to see if this hypothesis holds water? Listen, it's not as though an unconstrained connectivity model would be supported gratis. Subscription fees would still be applied. It's the things that the incumbents "do" with those fees that I am mostly questioning here. Thoughts?

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