Prince Charles, not exactly the flavor of the day in the UK press at the moment, once famously remarked that nanotechnology might unleash forces capable of reducing the physical world to a mass of "grey goo." Despite the brave public faces they put on, the telcos must feel the same way about IP, and last Friday I had a 40-minute Skype call with Bit Torrent creator Bram Cohen which would not make them feel any better about it. I wish I had a transcript to present here. (A footnote is that I wish Skype had some built-in mechanism for allowing audio streams to be captured easily, and I presume that the privacy concerns could be dealt with through having users validate each other's recording privileges in exactly the same way that contacts are authorized currently.)
Since I have no audio record to work from, I'm paraphrasing, but the crux of Bram's message was: "It's always difficult to predict where technology is heading exactly, but in this case the debate has been held and the result is in. All content and communication will be over IP. It subsumes everything, and the inevitable outcome is that pricing eventually goes to zero. The only remaining inhibitors are ubiquity of broadband access and bandwidth availability, but those will fall in time, and then it is all over." (This is precisely why I think the telcos will over time attempt something like this as a way to replenish revenues.)
Whew, I thought I was bearish on the future of traditional telcos and media companies. If the boards of old guard companies were genuinely interested in shaking themselves up and challenging their market assumptions (that's a huge 'if'), they would be mailing plane tickets to people like Bram and getting them in front of decision-makers as a wake-up call. As it is, he says he doesn't like flying, so maybe a Skype conference call is better - and it's free.