e key point here is service: Technology, while important, is not the lead act in this play. Services, applications, solutions, and value represent the lead theme, and content is the princi- pal cast of characters. Closing the Revenue Gap The triad of content, carriage, and computing represents a strong weapon in the war against the widening cost-revenue gap. The existence of multiple service markets (enterprise, consumer) dictates that there are multiple judgments that define their value in each segment. For enterprise customers, network management and professional services rank well in the hierarchy because they provide a technology-to-services transition strategy. For residence customers, the main item identified is broadband access. Other so-called value-added services include video, music, games, simple wireless videoconferencing, and encryption. Note that these are all content-based services. On the other hand, value-added services (by the market's definition of value) include back-office integra- tion, online payment and consolidated billing, content delivery (photos and video, primarily), and messaging (instant messaging and SMS). SMS, the GSM-equivalent of IM, is an enormously lucrative service offer- ing: It is more than 1,000 times more lucrative in terms of dollars per transported bit than the nearest competitive service. Furthermore, the margins on traditional value-added services-customarily, those pro- vided through the magic of the SS7 signaling network and driven by database-intensive caller ID capability-can be as high as 95 percent, one reason voice is still a lucrative product offering in spite of the fact that the price point for the service is declining. In this industry, we have often observed that the killer application for voice networks is data, Downloaded from Digital Engineering Library @ McGraw-Hill (www.digitalengineeringlibrary.com) Copyright © 2004 The McGraw-Hill Companies. All rights reserved. Any use is subject to the Terms of Use as given at the website. Telecom Market Segments 