Feature Article

May 18, 2011

What is Clearwire's "Core Competence?"

Clearwire Corporation has announced a seven-year operations outsourcing deal with Ericsson that transfers the day-to-day management of Clearwire’s 4G network to Ericsson. Sprint Nextel also has done so.

It used to be the case that telco executives would say “network operations” was their core competency, the unique and differentiated skill at the heart of the business. Clearwire and Sprint decisions suggest that is no longer the case, at least for some providers, who now indicate that operations is in fact not a core competency at all. 

That is not to say it isn't a competence, simply not the irreplaceable and unique competence. One might suggest both Clearwire and Sprint see something else, perhaps marketing, as the key competence.

Other providers might not say, but observers might believe, that the unique and core competence is management of regulatory affairs. Some of us would say that particularly is the case for AT&T, for example. 

In other words, where in the past skills in managing complicated “industrial” processes might often have been seen as the “core” competence, that arguably has changed. AT&T does lots of things that other competitors also do, which might suggest AT&T's unique advantage lies not in the things all service providers possess in common, but in those things AT&T is uniquely talented at doing. Could AT&T outsource customer service, marketing, sales and operations? Probably. Could it dispense with its formidable regulatory and lobbying skills? Probably not. 

One might also make that observation for leading U.S. cable operators as well. They might be good at many things, but what is it that constitutes the key and unique competence? Lots of companies also provide video programming, also create content, also provide voice and Internet access services. 

But one thing that always has been said of the National Cable and Telecommunications Association, the U.S. trade group for cable, is that it is among the most effective lobbying groups in Washington, D.C., exercising influence and clout beyond its financial means. 

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Gary Kim is a contributing editor for MobilityTechzone. To read more of Gary’s articles, please visit his columnist page.

Edited by Jennifer Russell

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