Alan,
The wisdom coming forth regarding AT&T and an appropriate counter strategy
is impressive. I particularly liked Hank LeMieux's idea regarding a
consortium of regional ISPs to defend and counterattack. Business membership
organizations, co-ops, and franchises are often born of such threats and
have proven to be very effective if they are planned well and supported
vigorously. Another option is friendly mergers and acquisitions based on logic.
I can only agree that the appropriate response to competing with a well
organized, heavily capitalized, global adversary is with enhanced personal
service. Historical benchmarking with other industries is clearly called for
in this situation. There are many case studies providing a wealth of
information in very similar scenarios.
Two scenarios in my background that provide good comparisons were public
regional companies that had considerable brand loyalty and a large share of
the regional market. Both were positioned at the lower end of the market
with narrow profit margins. In retrospect, they were perfect targets for
global giants with far greater synergism in virtually every aspect of
operations and marketing.
Despite advice to the contrary, management in both firms chose to fight fire
with fire by cutting rates, lowering service levels and substantially
increasing advertising. Some smaller competitors have done well in their
absence by providing value added products and services unavailable to the
giants.
Clearly, those ISPs that have created strong relationships with their
customers through personalized and efficient service appear to be in a far
better position to prosper in the changing landscape than those who have
survived by mini monopolies and/or cost alone. There is a very strong
current of apathy and anti-big running through the US.
We are not ISP experts, but it would seem logical that a decrease in
regulation combined with the inevitable entry of giants would point towards
segmentation similar to other industries rather than any monopoly. My best
guess is that while your market share may decrease, the market size will
multiply rapidly and the good ISPs may be better off in the long run.
Mark Montgomery
Revenue Builders TM
The Virtual Franchise SM
markmont@primenet.com
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