It was 4 a.m. when Tommy, the last man at the bar, downed his "shot for the road." After putting on his jacket, Tommy struck his best drunken pose as he slid off the stool—and promptly collapsed to the floor. Stunned and confused, he tried unsuccessfully to right himself. After repeated tries he gave up and crawled to the back door. Once outside, he tried to prop himself up against the wall, but failed. Finally, resigned to his fate, he crawled the half mile to his home, bundled himself inside and collapsed on the living-room couch.
Late the next morning he awoke to the telephone's shrilling. His wife answered it and in flash was in the living room, peeling a cushion away from Tommy's reluctant ears. "You were drunk again last night, weren't you?" she screamed.
"No, dear," he insisted. "I just had a couple of beers."
"Don't lie to me! That was the pub. You forgot your wheelchair again!"
And so it is with the communications industry. After a decade of delusions we've realized that we can't walk on water and that progress must come in a slower and more methodical fashion—with real returns and customer demand driving infrastructure investment. As we begin the new year, it's hard to shrug off the reality check that has crippled the industry, but we will. I have full faith in two human traits that will never change: greed and the drive to communicate faster and more efficiently.
Disguised by more politically correct terms such as "getting ahead," greed, combined with blessedly short memories and an innate urge to gamble, will drive investors back to the market. Neophytes and institutional investors alike will be eager to prove themselves smarter than their predecessors, that they can "beat the market." This is the easy part to predict since it's all wonderfully cyclic, capitalistic and human. What is more difficult to pin down in the communications sector, however, is what'll provide that initial siren call for investment. Optical is out, as is core networking, though broadband (DSL, cable, HFC) and metro access seem to hold a lot of promise over the coming years. But it is wireless that still captures the investors' imagination.
As much a symbol of freedom and individualism as the original Mustang convertible, the mantra for wireless devices is "access wherever and whenever." As I write this, IP Wireless has announced $27 million in its latest round of funding, Flarion is up and running in Korea with its second high-speed wireless network and Cometa (IBM, Intel and AT&T) is pushing WLAN deployment. WLANs are particularly exciting, having been a stellar performer in 2002. Forward Concepts puts equipment growth at 43 percent CAGR out until 2006, by which time it'll be a $10.3 billion market.
As wireless data devices proliferate and their data pipes widen, it's safe to say that they'll be one of the main drivers of future infrastructure development, but it'll be a few years before they tap out the current capacity glut. In the meantime, investors will wheel us back to the bar, prop us up on our new stools and order another round of hubris. But this time there'll be a cap on the tab.
Patrick Mannion
pmannion@cmp.com
