|Agentware - Why Agentware: advantages for ISPs 1|
Average total costs curve for an industry is a function of total technology use.
Since the big boys and girls have sophisticated technology _mixes_ at their disposal, you must have the same to compete, to drive your 'activity cost curve' to the right, as the big folks are attempting to do.
Average total costs for the industry determine its shape, size, the number of competitors. Some industries favour inherently small scale like the white curve (dry cleaning, or other point of service industries). There's no inherent way to bring additional technologies to bear to drive the industry toward larger constituencies. In some, like the web business (which has a curve remarkably like printing and publishing industry), it's spread across the spectrum of providers. And this is healthy and good.
But remember, I said it's the total technology used. At this very second, AT&T Worldnet doesn't offer sophisticated network application hosting, but when they do, you can be sure it will have dial tone availability and level of service. And what do you think this will do to the average industry cost curve. It will become like the red curve. It will force the number of combatants down dramatically. And you can be sure it will happen. It's a cultural thing. Managers are fired at AT&T for having 3 switch outages in a decade. I came into Bell Labs to work on VANS a decade-and-a-half ago. Do you think we all forgot about it, or fell asleep?
To leapfrog this strategy, you need to be able to build differentiators, by using AWT to build competing services (remember the water-cooler to reality thing). You need to be able to build uniq differentiators. and differentiators will be what you need to break out of the pack. To move to a higher value-added level. To move toward highly differentiated services.
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Agentware, a presentation by Dana Moore of AT&T.