Baby Bells’ Information Age Quest
What is the difference between a PC and a telephone? These days plenty, but the Bell Operating Cos. want to turn both into ubiquitous information tools.
Last week, the Baby Bells took a big step closer to this goal when U.S. District Judge Harold Greene granted them permission to enter the information services business.
The judicial ink was barely dry before telephone executives began talking excitedly of offering such services as remotely controlled kitchen appliances, real-time language translation and home shopping. Bell Atlantic Chairman Raymond Smith said the decision will improve “the quality of life for all Americans in the Information Age.”
Greene’s decision is indeed momentous, but don’t plan on dialing your refrigerator any time soon. This new Information Age remains well in the future, and it may not be the Baby Bells who deliver it.
Greene’s ruling was opposed by a wide range of companies in the publishing, communications and computer industries. Greene was reluctant to make the decision, which was mandated on narrow legal grounds by a higher court.
The next stop for the Baby Bells and their opponents is Congress and ultimately the Supreme Court. The crux of the debate will turn on whether entry of the Baby Bells into information services will stifle competition or catalyze the critical mass needed to get the Information Age going once and for all.
Greene fears the former, but the Bush Administration is promoting the latter. In all probability, the debate will end up being resolved by an alliance between the Baby Bells and the very industries so worried about their new role.
Newspaper publishers, cable TV operators and computer service companies have largely failed to sell on-line information at a profit. The Baby Bells are certain to add to the long list of losers once they manage to launch their new information services. A few highly visible failures between now and 1995 may be enough to cause some of the Bells to back out of ambitious information service plans.
Eventually, the Bells’ information service offerings will mature into gradual success. And the first successes are likely to occur in the business area. Remote monitoring of changing information bases, business-to-business Yellow Pages with integrated ordering and distributed computing applications are examples of the general areas where success could first come.
But success in information services will require more than the right offering. The Baby Bells have a critical but incomplete contribution to make to this new aspect of the information revolution. Despite their tremendous communications resources, they have little understanding of content. Partnerships with publishers or other communications companies are the logical way to fill this gap.
For example, a joint effort with a newspaper publisher could enable cost-effective production of everything from financial news monitoring services to hybrid paper-based/electronic classified advertising.
The lesson of Greene’s decision is that the PC and telephone are converging because the walls between computing, publishing and communications are tumbling down. Success in this new information world will require partners and ideas from all three.
