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Discussing the State of Telecom Research Today

Bob Lucky. Discussing the State of Telecom Research Today. Once Upon a Time …. Role of the Pre-divestiture Bell Labs. Standards (both official and ad hoc) End-to-end network design Basic research Industry and research leadership Seeding alumni throughout industry and academia.

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Discussing the State of Telecom Research Today

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  1. Bob Lucky Discussing the State of Telecom Research Today

  2. Once Upon a Time …

  3. Role of the Pre-divestiture Bell Labs • Standards (both official and ad hoc) • End-to-end network design • Basic research • Industry and research leadership • Seeding alumni throughout industry and academia

  4. The Economics of Telecom • Bits are becoming a commodity • Overcapacity in the long haul plant • Pricing tends to incremental cost, which is nearly zero • High up front costs • Fast depreciation

  5. Telco Revenue per Minute and per Call1980-2002

  6. $119,925 $102,502 $89,676 Dollars In Millions $67,146 $58,923 $58,186 $53,483 $45,235 $39,488 Year-over-Year Growth Rate 14.6% 28.6% 15.4% 33.6% 33.7% -14.5% -42.5% -9.2% US Telecom Capital Spending Source: Sanford Bernstein

  7. “Telecom is headed the way of DRAMs – pricing is set by the most idiotic competitor. It’s a race to the bottom.” Roxane Googan, Industry analyst

  8. Is There any Bottom to the Price?

  9. Yes, maybe there is a bottom Free?

  10. Free WiFi

  11. Is it Possible?

  12. Telecom’s Paradox • Telecom industry is in crisis in the midst of technological progress and strong user demand • Annual traffic growth: 100% • Annual growth of Internet users: 40% • Strong growth in wireless penetration • Usage of broadband, data, wireless, long distance all rising

  13. Problems in Telecom Research • Reduction in research spending • Change in the nature of research -> short term and applied • Globalization of the industry • Horizontal restructuring of the industry • Shortcomings of university research • Lack of national vision • Lack of end-to-end responsibility

  14. Where is Innovation Coming From Today? • Service providers have abandoned research almost completely • Equipment vendors do the only research in the traditional industry – and they have cut back significantly • New players – Microsoft, Qualcomm, and Cisco – have emerged to do varying amounts of research • The venture market, while still active, is not as robust • The academic community remains strong

  15. Where is Telecom Research Done? – Percent of IEEE Papers Authored by Industry and Academia

  16. Issues • Is Telecom research endangered? • Are there significant economic consequences? • What can be done • By government? • By industry? • By academia?

  17. The Panel • Jeff Jaffe, Lucent • Fred Chang, UT Austin • Niel Ransom, Alcatel

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