Ok, here's a joke that maybe only elementary aged children can
appreciate. "What is red, and smells like blue paint?"
Spoiler alert…think for a minute then look to the end of the post
for the answer.
Pretty lame! But there is a larger point to be made.
Let's assume rural telecom is a Red Paintworld and all other
businesses that have never operated
under a rate of return regime live in a Blue Paint world.
Does rural telecom still believe in the Red Paint world? With
diminishing Red Paint rate of return opportunities resulting from
the FCC's Broadband and ICC order, and with muscular Blue Paint
competitors that have never operated in a Red Paint world, rural
telecom providers will need to adapt to the emergingBlue Paint
world, lest they wither or die. Blue Paint companies can only
grow revenues and control or reduce costs to maintain or increase
profits. I am not saying Red Paint companies are not interested in
operating in the same manner, but the historical Red Paint
financial incentives that relied on network investments to increase
or maintain profits is under siege, both competitively and from a
regulatory perspective. If this new operating environment is a
permanent condition, then we're in a Blue Paint world.
As the joke suggests, while all paint is fundamentally the same,
a tiny amount of pigment makes the difference. Appearances
matter and how we perceive our color determines how we behave in
the world. Rural telcos are migrating toward the Blue
What is red, and smells like blue paint? Red paint.