I HAVE HAD AN ESPECIALLY hard time settling on what to write in this space this month. I feel conflicted. While on the one hand there seems to be an amazing amount of innovation (IPTV, VoIP, content delivery) on top of carrier networks; on the other hand the competitive carrier market and the channels resellers and agents face continued uncertainty about their futures.
It seems almost paradoxical. The last time there was this much going on (we called it the Internet Boom), there were opportunities aplenty. So what’s different now? I have thought about it, and it boils down to control of the network. Control of the network means control of the customer.
Here’s what I mean: Competitors have been stripped of their ability to use UNE-P. They didn’t have control of the network and they lost control of the customer. Yes, they still lease services from the Bells and serve customers, but not on guaranteed sustainable terms.
Many of the nonfacilities-based providers decided to move to a facilities model with VoIP, but still they are at the mercy of the access provider to bridge the gap between their softswitches and the customer premises.
And, even the CLECs that have their own switches use special access lines to reach their customers. Again, they are at the mercy of their suppliers. While they are still being supplied, their rates could be raised. With the megamergers, there is less competitive pressure to keep special access prices at viable levels. In general, insiders concede, the larger carriers are less interested in low-margin wholesale business when they can push higher-margin innovative services (see above) over their capacity-constrained networks.
This is all review for most of you, so what’s my point? The competitive providers are vulnerable where they do not own the last mile or do not have an alternative supplier to the Bells. Competitors need to figure out a last-mile alternative. I am hearing more and more talk about wireless mesh networks with point-to-point backhaul connections to the provider’s PoP as potential competition to mobile wireless networks. While such a configuration can bypass the LEC, what’s scary is there are fewer competitive intermetro network providers to connect to now that the old AT&T and MCI have been subsumed. What if Level 3 is bought by a Bell company? (It could happen.) What about Broadwing or Global Crossing? The list is getting smaller and smaller.
It’s ironic or maybe it’s not that I am advocating an intermodal strategy. Isn’t that what the FCC has been pushing? Well, it seems the commission set things up in such a way that the only path to invulnerability in this environment rests on the few competitors that can muster up a truly competitive network fixed or wireless with access to the building or home.
Those that manage this transition should be supported by resellers and agents that can bring more business to these competitive networks and help ensure their long-term strength. It may seem calculating to suggest preference for competition-friendly suppliers for that sake alone, but without them, the larger players have less incentive to provide customer- and agent-friendly offers.
.@abbyy_usa has hired Rusty James as the new head of partner business for North America. goo.gl/fb/FvZ6f3
December 13 2018 @ 16:01:55 UTC