The "Internet revolution".

The end to end network is perfect for Internet Telephony.

The Internet is a "end to end network".
The inventors of the "end to end" property of the Internet knew that a network with less, rather than more, funcionality in the middle (center) would be more flexible, and more suitable for applications that required weak error-checking.

They did not envision Internet telephony, nevertheless made a network perfect for voice transmission where a few data errors cannot impede our ability to hear and understand and where the delays involved in retransmission of bad data can make fluent conversation impossible.
In other words, without the end-to-end property of the Internet, without the ability to use different error-checking protocols like UDP (user datagram protocol, intended for transmission of small, unsequenced data units) and RTP (real-time protocol, designed specifically to relax error-checking) in place of TCP, applications like Internet telephony and online gaming would be awkward to implement and prohibitively expensive. But because Internet error-checking occurs in the endpoints, programmers are free to substitute protocols that are looser or tighter as their application demands. The Internet, the world's overarching end-to-end network, is now the connectivity medium of communications.

Yet telephone company networks are still centralized networks designed for a single application, voice.
Phone companies still make more money from voice than from other network traffic, even though the volume of data traffic now exceeds voice.
Furthermore, Internet voice is getting better and better—its quality can, in fact, far exceed the "toll quality" voice of plain old telephone service.

In addition, smart end devices can set up and manage telephone calls far better than a centralized network.
(Why dial a number when you can double-click on it?) In fact, when voice is implemented in end devices, the ability to mix it into other kinds of interactions—online game play, collaboration, mutual Web surfing, and many more yet to be discovered—the idea of a "call" as a special, discrete event could well disappear.

The Internet stands on the brink of making the entire functionality of the telephone company obsolete.
But that's not all—with access improvements within the grasp of today's technology, the Internet can do video entertainment better than broadcast, cable, or satellite television can. The Internet stands on the brink of subsuming the value of all existing special-purpose networks.

Telephone companies do not have a business model for running an end-to-end network.
They have always depended on voice revenues to subsidize network operations. Now they're faced with the prospect that voice telephony, their cash-cow application, will no longer be bound to their network. (Television and radio face the same prospect.)

It is not likely that the telephone companies will discover how to run a business based on end-to-end networks, because pure end-to-end connectivity will disrupt their single-application business model.
As Clayton Christensen points out in The Innovator's Dilemma, incumbents never lead a technology to market when it disrupts the incumbent business model. Exuberant innovation was the rule at Bell Labs, but the only innovations that Ma Bell brought to market were ones that were consistent with the old business model; when AT&T was offered a leadership role in Internet development, it passed—just as Western Union passed on the telephone a century earlier.
None of the networked winner apps of the past decade—e-mail, Web browsing, e-commerce, instant messaging, streaming audio, Web logging, peer-to-peer filesharing, and so on—were brought to market by telephone companies.
It's unlikely that telephone companies will field the pioneering communications applications for the new network. This discovery process is better left to more entrepreneurial companies operating in the free market.

There are two main scenarios for telephone company survival. Under the first, they won't; their networks will be managed gradually into oblivion by bankruptcy courts and the regulatory establishment that used to support them. Dial tone continuity would be maintained, but allowed to wither as a business as other alternatives matured.
New entities, such as municipalities, other utilities with rights of way, new kinds of companies (especially wireless ones), and maybe even customers themselves, would gain the freedom to discover successful operating models for end-to-end networks.

Under the second scenario, the telephone companies would exercise their remaining competence—their ability to manipulate the various agencies of government to their own advantage—to make it illegal (or prohibitively difficult) to make progress in end-to-end internetworking.
Under this second scenario, the Internet would be transformed into a centrally controlled telephone-company-like (and TV-network-like) network for use by approved applications only.
In nations that fall victim to this second scenario, those sectors of the economy that depend on progress in communications would devolve to third-world status, while nations that support end-to-end networks race ahead.

No nation can afford the second scenario.
We cannot afford to cave in as telephone companies entreat governments to prop up their dying technologies and dying business models.

Distant messages used to be delivered physically, first by sail, then by steam; the telegraph short-circuited those modes before being in turn shouted down by the telephone. We should not allow the established powers of antiquated centralized telephony to block end-to-end internetworking. Telemedicine, distance learning, remote collaboration, multicast news, multiplayer entertainment, and more are waiting in the wings, with yet undiscovered applications promising other new connections and benefits. We should make way for the new end-to-end network.

( Liberally taken from David Isenberg)

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