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Communications News

FCC May Push Bells to Unbundle DSL 233

Posted by ScuttleMonkey from the new-players-same-wires dept.
Carl Bialik writes "The FCC is nearing approval of two big phone deals -- Verizon-MCI and SBC-AT&T -- according to people familiar with the situation cited by the Wall Street Journal. But regulators are considering requiring asset sales and other moves, including the offering of unbundled DSL, 'without requiring consumers -- mostly home users -- to subscribe to phone service. Verizon already allows some customers to do that, but SBC doesn't. ... Patrick Mahoney, an analyst at Yankee Group, said that traditional phone lines are cash cows, so allowing customers to buy Internet access without traditional phone service would be costly to telecom providers.'"
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FCC May Push Bells to Unbundle DSL More

FCC May Push Bells to Unbundle DSL

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  • But what of the terms? (Score:5, Insightful)

    by 6th time lucky ( 811282 ) on Wednesday September 21, 2005 @02:31AM (#13611549)
    Sure you *can* get it unbundled, but you would loose out on the special $100 per month discount for having both services... and who wants $140 per month DSL just so it can be unbundled??

  • Phone lines are cash cows? (Score:3, Informative)

    by Anonymous Crowhead ( 577505 ) on Wednesday September 21, 2005 @02:38AM (#13611569)
    Only if you add a bunch of features. I have a land line for a security alarm system. Local incoming free, local outgoing $0.02/minute. No voice mail, call waiting, caller id, long distance, etc. $12/month.
    • $12/month is at the extreme low end of the pricing spectrum. As you mentioned, it's a line for an alarm system.. not exactly typical usage.

      Most people are paying upwards of $30/month for basic voice service.

      But, in either case, their phone infrastructure is a sunk cost, paid for a LONG time ago. The revenue they continue to milk out of all those people is highly profitable. Even at $12/month, they're not hurting. At $30++ per month, they're very happy, and will fight tooth and nail to maintain that capt
      • I pay $13 a month and get unlimited no frills calling. It's all I need at home. Vontage would be nice, but I can't get a local number with them.
        • $13/month? Is that before all of the taxes, universal service fee, 911 surcharge and whatnot?
        • It's all I need at home. Vontage would be nice, but I can't get a local number with them.

          With number portability, you should be able to keep your current number even if they're unable to supply you with a new one from your area.
        • How the hell are you getting a landline for so cheap?? My brother is able to get it for that, but only because he's disabled and on a very low income so they give him a special deal.

          But I was paying $25-30/mo for basic service. I dumped it a month and a half ago and went naked DSL. Still, I do wish I could receive calls for free on my cell phone. Pain in the ass.
      • But, in either case, their phone infrastructure is a sunk cost, paid for a LONG time ago.

        Maybe the lines in your neighborhood were paid for a long time ago, but your costs have to subsidize the growth of the network elsewhere in the company. Not to mention rebuilding in storm-destroyed areas. Its going to cost BellSouth almost $600 millon to repair the damage along the Gulf cost.

        Tell me: Does money grow on trees where you're from?

    • Well, that's $12 per month at essentially no cost to them. And where I am that same line costs $22/mo at the same cost to the phone company. Multiply that by something like 4 million customers for my carrier, and you have about $100 million per month, or $1 billion per year of pure profit.
    • This is so true. When I called the phone company to get service for my new apartment it was damn hard to get the service rep to just give me a basic line. They kept trying to sell me
      -caller ID
      -call waiting
      -phone insurance (I had never even heard of this before)
      -a service plan that would cover them coming to my apartment to inspect the building's wiring

      I ended up taking the bill from $30/month to $18/month by rejecting the extra "features", and it was easy to tell that the service rep on the phone wasn't at
  • ...why is it still so damned expensive? is pricing arbitrarily?

    • Re:My question is... (Score:5, Informative)

      by Alcemenes ( 460409 ) on Wednesday September 21, 2005 @03:04AM (#13611652)
      The short answer is yes, pricing is arbitrary.

      The Bells own the copper so they can basically charge as much as they please. Granted, they shove two services over the same pair of wires so one could argue that the only overhead for the telco would be the bandwidth but you also have to add in the switching equipment, wages for technicians, support costs and maintenance. On the flip side, the Bells are using infrastructure that was bought and paid for decades ago and they're basically squeezing every possible revenue stream out of their equipment so their costs aren't really any higher (other than bandwidth) to deliver DSL to a customer.

      The Bell's argument for not allowing unbundled pairs (dsl only) has to do with the regulatory requirements placed on DSL service. Now that DSL is classified as an unregulated information service that argument loses merit. Also keep in mind that VoIP is also unregulated for the most part. Add to this the fact that the Bells are beginning to convert portions of their networks to VoIP while building new, high performance ATM networks optimized to carry VoIP traffic. My guess is that the Bells will begin to offer unbundled DSL loops and shortly after this becomes available they will roll out VoIP services. This would allow the Bells to deliver high-speed Internet and dial tone over unregulated mediums essentially bypassing the bulk of the regulations and taxes placed upon telecommunications saving them a heap of money.

      I may be way out in left field on this but after having a few discussions with my account managers as well as technicians working for one of the Bells I think this is where they are heading. Bells are HUGE profit driven corporations so they are always looking for new ways to generate revenue, usually at the expense of competition.

      This is somewhat of a long-winded reply that has strayed off course a bit but hopefully I've made my point. I'm not going to pretend that I am some sort of authority on how the Bells operate. I am basing my reply on observations I have made and personal experience. I'm just throwing my two cents into the pot.
      • For starters, the Bells do not own the copper. Our tax dollars paid for the infrastructure, and the government only gave them maintenance control over the lines. The people own the copper, not the Bells.

        With that being said, The service is not necessarily shoved down the same two wires. Ever wonder why phone jacks have four wires instead of two nowdays, and that two of those four are (usually) never hooked up?

        Our DSL runs thru the outer pair of copper wires in our phone line, and the phone runs off the cent
        • You are crazy, AT&T (and GTE and all the mom and pop phone companies in the rural areas) did the inital buildout of their copper and retain ownership of that plant. They do pay franchise fees and taxes for use of public right-of-ways, but the copper plant (and switches etc) are all owned by the local ILEC.

  • SpeakEasy (Score:5, Informative)

    by Sorthum ( 123064 ) on Wednesday September 21, 2005 @02:43AM (#13611583) Homepage
    http://www.speakeasy.com/ [speakeasy.com] already offers a "naked DSL" option, but they do charge a premium for it over standard DSL-- and they're not even a phone company.

    Ideally with companies being required to separate the two there will be companies like Speakeasy that are now able to offer unbundled connectivity without charging extra for it.

    We can but hope, anyway...

    • Bum link dude (Score:4, Informative)

      by 3l1za ( 770108 ) on Wednesday September 21, 2005 @02:49AM (#13611605)
      try this one, instead: Speakeasy.NET -- NOT computational econometric software... but, as you say, naked dsl [speakeasy.net].

      Anyway isn't this another one of those Rhythms/Covad/Northpoint etc. companies. They collocate in the Central Offices and rely on the Bells if some particular piece of fit hits the shan. I NEVER understood how that model could work; dsl service is basically a commodity meaning: no room for a middleman reseller.

      For all I know SpeakEasy has its own copper wire loops and central offices, though...
      • Oh crap, you're right-- they are a .net.

        The way they do business is they use SBC or someone else in your area to go from your house to the central office (usually within a couple tens of thousands of feet). There, it plugs into their rack and goes into their network. Converted a former employer (small business) from SBC DSL to a Speakeasy package, and the speeds shot up like crazy since SBC oversells their network and maintains it like crap (at least in the Orange County CA area). They're more expensive
      • Speakeasy is really great. Unfortunately as you say, they just rebundle the physical layer service that the local bell sells, if they can. They'll always be more expensive, but their value has always been in having "the right" IP features (static IPs, shell accounts, fileshack etc.), whereas the local bells usually has the cheap piece of crap plan with minimal IP service, and then the expensive "business plan" which is more similar to speakeasy.

        Worse, companies like speakeasy cannot deliver to locations fed
        • Worse, companies like speakeasy cannot deliver to locations fed by remote access DSLAMs, quite common in new developments.

          Until I moved about a year ago, I had DSL service through Megapath (great company, BTW - top notch service) over BellSouth copper, and as I recall I was going through a remote terminal owing to the 27K foot distance from the CO. I've heard great things about Speakeasy too, so if I were going for DSL again I'd definitely go with a reseller - unlike the Baby Bells, they really underst
      • My Speakeasy SDSL service is on a Verizon pair, Covad DSLAM, Speakeasy IP connectivity.

      • Re:Bum link dude (Score:3, Insightful)

        by jefftp ( 35835 )
        I had Speakeasy IDSL (DSL over an ISDN connection) 18 months ago in Houston due to my distance from the nearest CO. It worked great for two years, but when it finally did break the finger pointing began:

        It's a problem with your router, it's a problem with Covad, it's a problem with SBC, it's a problem with your router.

        After two weeks I was still unable to get things back up and working and they wanted me to put a deposit down for a Covad engineer to visit between 9am and 4pm weekdays only. Keep in mind this

    • Re:SpeakEasy (Score:2, Interesting)

      by Spezzer ( 101371 )
      I have 'OneLink' DSL with Speakeasy, and the advantage is that you get pretty much a 'guaranteed' service.

      I was about 6000 feet from my CO previously, and despite that, I could not maintain 1.5/768 DSL due to a crappy line installed by PG&E. Unfortunately, because there was no onelink service, I couldn't do anything if PG&E didn't want to help me out, which they didn't.

      However, once I got OneLink, PG&E was now forced to lay a new line down or fix the line so that it was up to spec. Now I'm abl
    • Speakeasy probably charges a premium over standard DSL because it is a premium service. Who would have thought?

      Speakeasy proably has long running contracts from before the FCC ruling in question, and as such, probably aren't affected, for now.
  • And if you get a phone, the Feds take away some money, and blow it on stupid projects.

    They say it is for subisdizing phone service in hard-to-reach places, but that's not all. E.g. buying a bunch of computer networking crap for schools that don't/can't use the stuff.

    Phone service is encumbered with layers of pork and regulation. DSL is relatively free of that crap, right now.
    • Don't start blaming that on the government, well except that the whole phone monopoly is the governments doing, but nearly all of those so called "fees and taxes" on your phone bill go strait into the pockets of the baby bells. The regulation is not hurting you, its the only reason phone service is half way affordable. Whats killing you is that the phone companies have a monopoly and there is nothing you can do about it.
      • Not quite true. The gov does place a lot of taxes on phnoe service, such as the "Universal Service" fee GP was talking about. We do pay so people in the sticks can have phones instead of moving to civilization.
        • Not quite true. The gov does place a lot of taxes on phnoe service, such as the "Universal Service" fee GP was talking about. We do pay so people in the sticks can have phones instead of moving to civilization.

          I'm not saying I agree with the tax, but why should people be forced into moving "to civilization" just to get a phone?

          You going to make me worship whatever god you believe, and eat the same foods you like next?

          --
          telnet://sinep.gotdns.com [gotdns.com] -- TW2002, Usurper, and LORD registered!
    • We're still paying fees that were added to telegraph services back during the Spanish American war.

      Once the government gets their hooks into you, it's damned near impossible to get them out.

      LK

  • don't just do something, stand there (Score:3, Insightful)

    by opencity ( 582224 ) on Wednesday September 21, 2005 @02:46AM (#13611598) Homepage
    A timeline of how big telecom has hindered broadband in the US is one day going to be as funny and shocking (in a quant corruption kind of way) that reading about the building of the Brooklyn bridge is today.

    From the baby bells in the early 90s to the ...

    ouch

  • Doubtful they'll lose too much... (Score:3, Interesting)

    by Sorthum ( 123064 ) on Wednesday September 21, 2005 @02:47AM (#13611601) Homepage
    I highly doubt that these companies lose money on their DSL offerings. I categorically refuse to get a landline, so when it came time to get a broadband solution in my new apartment, the cable modem won out.

    If DSL were available by itself, I'd have gone with them instead, given that it's generally a cheaper option. So at least in my case (and I'd imagine I'm not the only one in this position) they'd gain a customer by offering the two services separately.

  • how does it work down there in the U.S. ? (Score:4, Informative)

    by Adult film producer ( 866485 ) <van@i2pmail.org> on Wednesday September 21, 2005 @02:53AM (#13611618)
    I'm not entirely clear how dsl/cable access is achieved for customers in the u.s.... up here in canada it's sort of a monopoly for cable access, depending on which region you're in. For DSL, I believe many companies offer service in the same localities.. service is good, I get mine through cogeco cable, downtime in the last two or three years i could count with one hand (in hours.) The speed is decent as well, I regularly get 500KiloBytes/sec download from torrent sites and my upload speed maxes out at 85 KiloBytes/sec (very easy to keep my ratios at 1.5:1 or better.)

    Many of my friends have experienced the same with DSL, although it doesnt seem as robust as cable when I'm using it... maybe responsive is a better adjective to use.. Even people out in the small towns from the cities, 40-100 miles still have decent broadband service.

  • In contrast (Score:4, Informative)

    by overshoot ( 39700 ) on Wednesday September 21, 2005 @02:55AM (#13611622)
    I'm in Germany right now and have been comparing DSL rates with my colleagues. They complain about Deutsche Telekom pretty much as we do about the BabyBells, but a DSL line here costs about half what I pay in Arizona, with voice separate. No ISP required, so instead of $30/mo for the DSL and $20/mo for the (mandatory) ISP they pay about €15/mo total.

    Since a land-line here doesn't save you from per-minute charges, half of them don't even bother and just use the mobiles for everything.


    • I'm in Germany right now and have been comparing DSL rates with my colleagues.

      Well, I'm from Germany, and I find your statement not entirely correct.

      First, Deutsche Telekom does not sell unbundled DSL lines. You have to have phone service from them to get DSL. POTS is ca. EUR15/month, most people nowadays order ISDN which is about EUR24/month, no minutes included respectively.

      The cheapest DSL line you can get is EUR16/month (1Mbit down, 128kbit up). ISP is not included with that. Since beginning of
  • This might be beneficial to the consumer! Has it come to this, that the FCC is floundering so badly as to do something that might actually be good for the consumer?

    But then again, is it beneficial? Or fair? Damn... all this stuff having to do with the power/communications infrastructure stuff is too darned complicated. My last dealings with the FCC were when I got my CB radio license back in, oh, 1980. What have they done for me lately? (cue Janet Jackson)
    • CB used to be licensed? I thought it was for anyone who wanted it, and HAM was the license class?

      --KB1JWQ
    • Actually, NO!

      The FCC has already granted the "baby Bells" the ability to "discourage" 3rd party DSL providers from access to "their" POTS wiring (paid for by taxpayers raped & pillaged by the AT&T monopoly) at wholesale prices. The various state legislatures have largely caved to the wishes of the telcos by eliminating/strangling 3rd party metro WiFi competition. The "9-11" requirement by the FCC for VoIP providers was more "sand under the wheels" for the telcos' competition. I see the unbundling
    • "This might be beneficial to the consumer! Has it come to this, that the FCC is floundering so badly as to do something that might actually be good for the consumer?"

      No kidding. At first, I was going to write this effort off after reading the Slashdot summary. The FCC has done everything in their power to pay back all of the campaign contributions made by the Phone companies, at the expense of the consumer.

      The reason why these changes are being proposed is that the Justice department "had some concerns"

  • FINALLY (Score:5, Informative)

    by scronline ( 829910 ) on Wednesday September 21, 2005 @02:56AM (#13611633) Homepage
    Some good news coming from the FCC for a change. As an independant ISP using SBC transport it's been a huge pet peeve that they subsidize their DSL costs with their phone service(s). Until this new jerk got into the FCC it was actually illegal subsidization that was putting an unfair advantage in the hands of the telcos.

    Of course the fact that DSL is provided over a phone network that was built with tax dollars then handed over to the telcos to be maintained doesn't mean anything anymore...so why shouldn't they have a government sponsored monopoly.

    Of course this is flame bait for people who don't understand the way the economy works and how people like myself are important for getting services into remote areas that neither cable or the telcos actually care about until people like myself start complaining that we have large amounts of customers that went it in that area.

    • Re:FINALLY (Score:3, Interesting)

      by danielsfca2 ( 696792 )
      $telco = {"SBC", "Qwest", "BellSouth", "Verizon"};
      $cable = {"Comcast", "Time Warner", "Cablevision", "Charter", "Cox"};

      Don't buy it. FCC "might" but they never will. $telco will get what it wants, and what it wants is to force you to buy crappy phone service you don't need. $cable isn't interested in competing on price, so while they'll sell you the net without the TV, it'll cost you $55 a month anyway.

      Sorry to be a pessimist, but I just can't see this happening.
      • $cable isn't interested in competing on price, so while they'll sell you the net without the TV, it'll cost you $55 a month anyway.

        Am I the only one around here who thinks 4Mbps/512Kbps for $55 a month is a good deal?

        A T1 will still cost you $700/mo for 1544Kbps with Internet transit.
    • The characterization of the telco system as being "built with tax dollars and then handed over to the telcos for maintenence" is just plain wrong.

      What is true is that local phone services were given power by local and state governments(right-of-way and monopoly status) in return for universal service requirements and the right to regulate the prices charged. In a separate initiative, areas that were simply uneconomical to wire for phone service (farms basically, on which only a small part of the populati

      • No, I think you're wrong. The AT&T was treated like a utility; meaning they operated on a "Cost Plus" basis. The infrastructure was all Tax dollars. Local phone service was used to subsidize the Yellow Pages to keep out competition.

        The prices were regulated, but having to pay about $50 per month per household to just connect to this network for eternity is not much regulation.

        What will we see when WiMax is able to create huge networks? Could it be possible to create an independent switching network?

  • I feel your pain (Score:3, Insightful)

    by Anonymous Coward on Wednesday September 21, 2005 @03:27AM (#13611698)
    So...."allowing customers to buy Internet access without traditional phone service would be costly to telecom providers."

    Wrong. They are not entitled to profits. McDonalds doesn't lose money if you don't buy a hamburger. A business doesn't lose money if you buy the competition's product.

    On the other hand, we all get screwed when businesses look at consumers as owing them profitablility. These Telecom's are the same folks trying to prevent cities from providing public internet access. As Joe Consumer, what costs them neccessarily pleases me.
    • For a DSL line you need CO equipment, and a line.
      For a phoneline you need (different) CO equipment, nd a line as well.
      Becuase phoneline service existed first, the price includes the full tariff for the line. So, a DSL offer can, while it requires a line, disregard the cost of it. The customer is already paying it.

      Allowing DSL service without phone service at the same rate will cost the company money because the costs of the line are not recovered.
      You would have to split the phoneline bill in two parts: f

  • Why? (Score:3, Informative)

    by Master of Transhuman ( 597628 ) on Wednesday September 21, 2005 @04:08AM (#13611768) Homepage
    "allowing customers to buy Internet access without traditional phone service would be costly to telecom providers."

    The same assholes provide cellular as provide land lines - and the only threat to landlines is cellular right now - VoIP is not yet a threat (but will be.)

    They're gonna charge you up the yin-yang either for cellular or landline, so who cares which it is? DSL is not relevant to that. Anybody who has DSL probably has cellular anyway - albeit perhaps in addition to landline. If they dumped landline, said customer would stop paying $15-20/month for his few landline calls, and make up the difference on his cellular anyway. It would probably be a wash.

    The only reason landline is a cash cow is because they've paid for the infrastructure long ago. In a few years the cellular towers and systems will be paid for as well - or be replaced by wireless nodes anyway, probably hanging on the same towers.

    The only thing not paid for is wireless (which is cheaper anyway) or fiber to the home (which isn't cheap at all, but critical to delivery of media content - unless wireless can hit 100MB to the home soon, in which fiber to the home might as well be dropkicked.)
  • In Finland there was a law change which forced the telephone operators to lease their wiring to anyone who wanted. In my area I can get unbundled DSL from around 20-ish competitors, and in fact we don't even have a regular phone, only cellulars.

    Even the pricing is OK these days, I pay about 20 EUR / month for 1Mb/512Kb. Faster rates are available, up to 24Mb ADSL2 for those who want/need it.
    • In the Netherlands we have a similar situation. Unfortunately the lease price for a bare line is not much below the cheapest phone rate (lowest monthly rate with highest per-minute rate) so it is not very attractive. You save maybe 2 euro per month when you do not call.

      Furthermore, those that offer unbundled DSL are usually the cowboys in the market. They have a big mouth full of promises and the lowest rates, but they are also in the top-10 of all consumer complaint lists. When your line works, you are
  • Verizon will sell you a dry loop but you must ask for it. I already have dsl and phone service with them and wanted a dry loop for a voip phone. What their site doesn't tell you is that they will charge a $199 "rolling truck" fee for running a new line to your address. Hardly worth it if you ask me, considering my old line handles dsl just fine. You can't tell me theres no other way around this.

  • Fiber coming too. (Score:2, Informative)

    by SpaceTaxi ( 170395 )

    In eastern PA, where I live, Verizon is rolling out a fiber optic network. Up to 30MB downstream, 5MB upstream. http://www22.verizon.com/FiOSforhome/channels/FiOS /root/faq.asp [verizon.com]

    They also have been quietly offering $14.95 naked DSL as part of a deal with Yahoo. http://www.internetnews.com/xSP/article.php/352935 1 [internetnews.com]

    I tried to see if I could sign up for this services and drop my dial tone, but they are only offering it to new customers. I ended up ordering Comcast cable at a promotional rate of $19.95 with the

  • It's realy quite easy. Call up SBC and tell them you're moving. Where you tell that you're moving is the key. You have to pick a place that does not have ANY SBC service. Rural areas work well (such as my tiny home town of 231 people). If SBC does not have coverage in that area they have to let you out of the contract. That's their policy and they adhere to it. I've moved twice now to areas that didn't (yet in some cases) have SBC coverage and was let out of my contract. I'm considering doing that r

  • SBC/Yahoo DSL (Score:2, Informative)

    by zenray ( 9262 )
    As a matter of fact since I have SBC phone service anyway I just, two days ago, upgraded my dial-up to SBC/Yahoo DSL service for only $14.95. So far I just have an old and very temporary Windows system up but the DSL modem takes care of the PPPoE connection. I'll soon have a SmoothWall firewall up and my Slackware Linux systems back on the internet. My biggest problem right now is with Yahoo. There is some kind of self helper that is trying to install an updates already. I think the type of web space with t
  • Being a UK resident, I just find this highly amusing. Our phone and internet access have always been seperate items. Before broadband took off, there were a bazillion isps out there, and indeed British Telecom's own service was one of the most expensive. Even now we have DSL, you can buy it from any one of a dozen or more providers (and again, BT's openworld service is more expensive than some)

    It just find it hard to beleive that the US telecom companies are in a snit about it.
    • The local telcos are having a difficult time adjusting to the fact that people are no longer required to subscribe to their service. For about the past 40 years or so almost every American home has had at least one telephone line provided by the local telco. It used to be that commercial subscribers and Long Distance subsidised residential service. Telcos and their customers had to adjust to residential telephone service becoming a major income producer for the telcos when the Bell System was broke up on
  • Lets think about this. Company runs millions of dollars in wire all over the city and into your home. Why is the Internet a regulated service? Why should they provide one service without the other? They say it's 'fairness to other phone providers', but what about fairness to other ISPs as well? Why is one service regulated and the other not? Is it just for legacy reasons?

    How does the consumer benefit from this? I've done this before as a temporary measure, and paid an extra $10USD/mo for a 'line fee'

  • Granted, I'm living in Tokyo where the population density is about 137 people per square foot, but it can't be that hard to string optical fiber alongside the phone lines . . .

  • "Patrick Mahoney, an analyst at Yankee Group, said that traditional phone lines are cash cows, so allowing customers to buy Internet access without traditional phone service would be costly to telecom providers."

    Cry me a fucking river, ILECs. Since this is supposedly a capitalist society, why don't you get off your lazy asses and provide some value and customer satisfaction to get your business instead of whining about all the people who want to desert your broken ship?

  • "How the internet killed the phone business" (Score:3, Informative)

    by fiannaFailMan ( 702447 ) on Wednesday September 21, 2005 @11:57AM (#13614273) Journal
    traditional phone lines are cash cows, so allowing customers to buy Internet access without traditional phone service would be costly to telecom providers
    The Economist has a good article about this very issue this week. From the leader:
    THE term "disruptive technology" is popular, but is widely misused. It refers not simply to a clever new technology, but to one that undermines an existing technology--and which therefore makes life very difficult for the many businesses which depend on the existing way of doing things. Twenty years ago, the personal computer was a classic example. It swept aside an older mainframe-based style of computing, and eventually brought IBM, one of the world's mightiest firms at the time, to its knees. This week has been a coming-out party of sorts for another disruptive technology, "voice over internet protocol" (VOIP), which promises to be even more disruptive, and of even greater benefit to consumers, than personal computers

    From the article itself:

    "Much more so than fixed-line operators, mobile operators would have to cannibalise their current business in order to generate new revenues from VOIP. Ironically, this means that BT, once regarded as a dinosaur-like incumbent, is now being held up as a shining example of an operator that is embracing the future, while Vodafone, whose pure-mobile strategy once seemed visionary, now stands accused of being on the wrong side of history. At the end of the day, there is no getting around the reality, as Skype's Mr Zennstrom says, that "something that is a great business model for us is probably a terrible business model for them.""

    Full article [economist.com], subscribers only I'm afraid! :(

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