Clint Ricker wrote:
And without the revenue from the rented network, how would anyone
build
new facilities?
Revenue from the services sold on the network through retail options,
as has always been the case...
Dynamic T1 and Integrated T1 were CLEC inventions.
VoIP didn't come to the masses from the ILEC's and neither did DSL or
dial-up.
CLEC style VoIP is not really all that interesting--in the end, it is
all to often POTS over IP and leaves out much of what is potentially
interesting on VoIP.
Not every CLEC and I have to wonder if you are just looking at the big
National Idiots like Paetec-USLEC, FDN-Nuvox, and TWTC-Xspedius. Those
guys are going to be facing BK with their mounting debt and shrinking
revenues.
It's the regional players like Cbeyond, CavTel, and a few others.
You can't make sweeping remarks, because the industry is not really an
industry at all but a collection of people tied to the idea of being an ISP.
Agreed...but that was 1998-2002. What have they done for us lately?
Again it depends on who you look at. Birch and McLeod not a F$^&$%ing
thing ever. But some others like Hunt Telecom, Vern in VT and some
others.... different story.
I'm honestly not trolling here, although, given the forum, it
definitely comes across that way. Definitely, back in the 1990's and
early 2000's, CLECs drove costs down and drove in new services that
Bell had little interest in offering. That was 5 years ago, though.
By and large, the bells are usually fairly competitive price wise in
the business market and by far the best value out there in the
residential / SOHO market. Now, it is largely the cable/telco
competition that is keeping prices down, not the CLECs...
The Bells are only competitively priced where they face competition.
Their local and LD rates have climbed up about 6% nationally since
consolidation, which explains some of the huge 61% profit increase at AT&T.
In ATM, MPLS, Private Line, and some other Special Access stuff, they
are plainly priced for 1999. No competition.
Why is Metro E priced so low in Metro's? Competition from the CLEC's
like L3 and TWTC and Cable.
I worked for several years at an ISP that did the whole BellSouth DSL
NSP stuff. The FISPA list, etc...continually trashed BellSouth DSL
service and their poor customer service, and so forth, and espoused
the the glories of independent ISPs, which I largely agreed with until
one day when I setup a friends self-install DSL kit from BellSouth.
It was a very slick automated installation procedure that was _much_
better than what we were doing.
Actually then, some of the fault is your very own. You may not have
owned NEGIA but you worked there and could have contributed to the Value
Add and keeping ahead of th ewave, especially after experiencing the
FastAccess.
The Independent ISP community did _way_ too much talking about their
own value and their own "great customer service" while, by and large,
doing very little to actually improve workflows, improve the customer
experience (in terms of ease of turn up) and way too little time /
effort spent actually selling and marketing. Simply put, by 2005 the
telco offering by and large was, for most people, a better product.
Again, this isn't a universal indictment, but a lot of their problems
were self-inflicted and not the result of FCC meddling. Too much
talk, too little action...
Because the ones doing MOST of the complaining are complaining instead
of selling and working ON their biz.
The quiet ones are too busy selling and talking to customers to get on
any lists.
Way, way too much time was and is still spent blaming the government
and the "evil" ILECs and too little time / effort spent actually
selling, improving business operations, and reinvesting in better
infrastructure / services.
FISPA and AISPA and other associations are partially to blame. All
problems were ILEC based and FCC pointers.
Remember how Tom and I were constantly pointing out that there were
niches to win - and it wasn't by selling on price?
Portal. Community. Hand holding. Simple bill. Training. Classes. Lunch n
Learn. Demos. Outreach. Tons of ways to take the advantage.
Honestly, would you say that (insert independent ISP reselling ILEC
DSL service) has a better DSL offering than (insert ILEC)? By and
large, I wouldn't...
I think DSL is a crap product overall. New Edge, Covad, ILEC - doesn't
matter. My personal experience is that it is over-priced crap - even
when it is cheaper than cable. Mine constantly blinks sending my ATA in
to a tizzy.
Most of that is the market...L3, WilTel, and GX screwed themselves
over by throwing billions of dollars into an incredibly overbuilt
market (carrier fiber networks). Paying $$$$$ to run even more fiber
from Chicago to New York when there is already way too much is a MUCH
different market than last mile. The good thing with last mile access
is that there is a very viable return on the investment and very
little competition (you have _at most_ 2-3 providers who have physical
connections to a given address).
It is WAY TOO EXPENSIVE to run last mile to consumers.
Business parks, downtown areas, greenfield development, mixed use - sure.
Older sections of town - no.
And again THERE ISN"T MUCH MONEY available to do these build outs.
Ideally,
1. Get accurate data about who actually has access to Internet access!
2. Eliminate ALL vertical monopolies (ie you cannot sell more than one
of three out of physical, network, and application layers except for
rural markets). At some point, this means that for the physical
network providers to grow, they have to expand infrastructure (among
lots of other good things). It may make sense for the physical layer
to be actually muni-owned in many areas.
3. Heavily subsidize community-based efforts in rural areas. In the
end, if the people want to get on the 'net, they should be a driving
force in the ultra-rural market.
4. Place a "bounty" on each rural subscriber added (or some similar
metric). In other words, subsidize ex-post-facto instead of on a
vague promise of future network buildouts...
5. Use the data from one and go down by population. In other words
concentrate on the rural market before getting to the ultra-rural
market.
Now, #2 won't ever happen.
Okay. Great plan it will not fly. (And you made fun of CLEC's!)
How do you deal with ILECs who don't follow the regulations? That's a
tough one, since most of the legal mechanisms (fines and so forth)
aren't really effective because they 1. just become a cost of doing
business and 2. are so weighted down in court battles as to be, at
best, too little, too late. I don't really have the answer to that
question.
I think that the government has to be willing to use political
leverage a lot more. While I tend to agree with a lot of the major
FCC rulings over the past few years, they were given away too
lightly. Just because it is the right decision doesn't mean that it
can't have strings attached. In other words, the government has to
actually grow a backbone... Want DSL line sharing requirements
dropped? We'll talk AFTER we have X% of rural buildout.
The animals are already outside the barn, so closing that door now isn't
going to help.
Again, you have to deal with what you have and what's available.
I talk to CLEC's almost daily. Many smaller ones are beat up. Every plan
they have tried since 2001 has been hurdled or cut off. And you are
giving these What If's in a plan. It'd be nice, but no one has that data
(or is going to release it).
The gov't isn't subsidizing rural - you have to go get a USDA loan for
that - and the loan is for assets only - not labor, etc. So you have to
have a great plan, efficient org, capital, get the loan, and execute on
the build and the sales at the same time. Something most telecom people
are not familiar with.
I don't really find the debt that big of a deal...a couple of
thousands of dollars of debt per customer financing buildout when the
ARPU can be $10,000-$20,000 over 10 years for a residential subscriber
is a pretty good deal.
Where does that investment money come from?
In my experience with CLEC's and MSO's, it just is not available. And
you can't bank on 10 years. Try more like a 5 year plan of return.
The network buildouts on the cable side are _much_ cheaper than on the
telco side--the upgrade to DOCSIS 3 is not much different, cost wise,
than the upgrade to ADSLv2. However, cable doesn't have to do fiber
upgrades (coax is much better than fiber--HFC plants can push 50Gb/s
worth of data) and cable doesn't have the very expensive capital costs
of video network buildouts... DOCSIS 3 will come down fairly quickly
simply because it isn't all that expensive (relatively speaking) and
doesn't require that big of an overhaul...
Yeah, really what's a couple of billion when you have $100B in debt.
Nothing really.
And DOCSIS 3.0 gear won't be available before 2009. Even 700 and AWS
gear probably won't be available before then.
BTW, everyone - cable, telco, ISP - is hoping the US will subsidize this
build. If you look carefully at the value of the dollar and our
trillions in debt, I don't know where that money is going to come from.
The reality isn't pretty. It means that builds will come as demand
comes. And it will slow.
VZ is going to spend ":upward of $18 billion on its FiOS fiber-optic
network, which will cover just 14% of the United States." So where
would a CLEC that wants mucho millions to cover 1% of an area get the
$1B. To build out 400 feet of existing fiber for BellSouth is $7000.
For L3 to build out one block is $25,000. So where is the ROI on that?
-Clint Ricker
Kentnis Technologies
- Peter
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