Thursday, February 04, 2010

A Telecom Straight Shooter Reply

Dave Rusin is the CEO of American Fiber Systems. He is a fiber bigot and kind of anti-CLEC. He has a two part post about the Special Access fight at the FCC.

Dave may have his dockets confused. The Special Access docket is about FCC tariffed circuits. The fight is over the tariff rates that other carriers like cellcos and IOC's (independent ILECs) pay for transport costs (Bennett explains it well here). These circuits are used to transport voice calls from towers, rural central offices, and internet bandwidth. This is the Middle Mile that the broadband stimulus legislation was supposed to boost.

This docket is different from the Cbeyond petition for reasonable wholesale access to MSO and ILEC copper, fiber and hybrid network (plant). (WC Docket No. 09-223). Covad asked for cheap UNE rates on all fiber systems of the ILEC's in its comments on this docket. (read my previous post about this).

I think Dave was ranting about the UNE docket not the Special Access docket. My rebuttal points:

1) Mainly, COMPTEL has failed. It's main goal should not be lobbying, because what has it ever won? It's main goal should have been to force cooperation. For example: Where's the lit building database? Where's the dark fiber asset database? Where's the COMPTEL ENUM/HD VoIP Peering Fabric? This would remove dependence of ILEC and divert revenue from ILEC's to other CLEC's.

2) CLEC's have been mucking around for 14 years without a density plan. It's been go wide, not go deep. Foolish plans. My CLEC clients are smarter than that.

3) We still need the copper plant. Period. Despite both AT&T and VZ looking to dump the PSTN as soon as possible. They do this because landline loss is causing the maintenance cost to go up -- and soon we will figure out that they lied for years about how much it costs to ignore, I mean, maintain, the copper plant.

4) In the heady days of UNE-P -- before ILEC's had LD revenue - CLEC's took a whopping 15% of market share. And yet no ILEC went bankrupt. So TELRIC rates, etc. were kind of bull. And the ILEC's lied... again.

5) CLEC's aren't the ILEC's biggest problem: Cable is. Specifically Comcast. CLEC's actually keep revenue in the TDM world instead of moving it to the MSO balance sheet. ILEC's should remember that. And at best CLEC's will only get 15% of the market. Cable is closing in on more than Half! ILEC's should embrace the wholesale model to sell more circuits to ISP's and CLEC's to fend off cable.

6) On Wireless: there isn't enough available and usable spectrum left. Too many carriers are sitting on the good stuff. Meanwhile, Unlicensed is getting too noisy in too many parts. Spectrum is a finite business -- there's only so many MHz of usable spectrum and it only provides X amount of bandwidth. AT&T's network issues kind of display that.

7) While I think that COMPTEL and the CLEC's have wasted lobbying dollars, if the RBOCs spent their lobbying dollars on customer service, they would be beating the CLEC's -- and wouldn't have to lobby.

Now, Dave, I have some questions for you:

You pick on the CLEC model, but how many lit buildings do you have? How many miles of fiber have you added in the last couple of years? How deep are you in any lit building? How full are your pipes?

You certainly dislike the CLEC rental model, but most fiber companies don't Crush It either. Wholesale backbone has been a sector running red. Some of it is definitely a lack of sales skills. Some of it is dump pipe mentality (it's a commodity). Some of it is that fiber tends to be where other fiber exists -- namely, how many lit buildings (carrier hotels, data centers, POP's) have multiple fiber carriers? And yet the buildings within 4000 feet of that POP have no fiber access. How many laterals?

Then there's the whole route miles thing. Who actually owns the conduit and fiber? Who just has strands on an IRU model inside the conduit? Who is buying from another fiber carrier? Is there route protection? (Interesting post about this here from Intelletrace, who posts about cooperation with both O1 and XO.)

Fiber is a great model. But as we have seen from Yipes, expedient, Cogent, McLeod, and others, putting fiber in doesn't make a successful business either. You need the complete plan. FiberLight certainly looks like they have one. Having worked with Zayo on a deal, I would say that they still need work. But sales is the part that almost all CLEC's fail on. It's not build it and they will come.

But if you need help in sales, please call the RAD-INFO, Inc. hotline 813-963-5884 for immediate sales training or sales planning.

1 comment:

Unknown said...

Thanks for the positive statement about FiberLight, Mr. Rad. As a metro optical network provider and owner of a 500,000 fiber mile footprint in 21 markets and 7 states, we focus on several key principals for continued success: financial discipline through a rapid return on investment, taking calculated risks, and requiring accurate forecasting to determine future growth. Additionally, we offer our customers choices: from flexibility in the products we carry, to carrier access, to customized network offerings. Thank you. Pat Mahony, FiberLight, LLC.