The Time to Play Piggyback May Be Here

FRAMINGHAM (04/18/2000) - Can there be too many telecom competitors and not enough telecom competition? A reader raises this paradoxical but valid possibility.

In my last column, I wrote that there could be problems ahead for competitive local exchange carriers (CLEC) trying to get someone to hear their complaints about mega-Bell SBC Communications Inc.'s digital subscriber line (DSL) rollout. SBC's architecture drags fiber to thousands of neighborhood terminals that only support Alcatel asymmetric DSL (ADSL) line cards - and leaves scant room for competitors to collocate their own line cards.

But since SBC has promised politicians a big residential DSL rollout to compete with what AT&T has up its sleeve in cable, the rule-makers might not be too interested in the complaints about SBC from competitive carriers with a reputation for bypassing the residential market.

Thus, I said, CLECs "may have no savior this time." The reader wrote to say they don't deserve one. His point: Dozens of CLECs are useless if they can't provide their own alternate path to the premises.

"CLECs don't have some right to have all the dirty work done for them," he wrote. "Sure it is nice to be able to get copper loops from the [incumbent local exchange carriers], but if you think that will work for you five years from now, you are crazy."

I don't know about five years in the future, but I'm sure of five years in the past. In 1995, consultants warned businesses that buying services from CLECs that piggybacked on incumbent loops was a sucker's game. Under the law passed by Congress the next year, incumbents are required to do the dirty work of providing the local loop to CLECs. But why save 5% off your local analog phone bill just to have a CLEC and an ILEC squabble over who caused your outage, especially when there's a difference now?That difference is spelled e-x-t-r-a-n-e-t.

When pure enterprise networking was all network professionals had to consider, it made sense to look only for CLECs with dedicated fiber facilities into corporate sites. But now managers connect telecommuters, mobile workers, trading partners and customers.

If network managers want to deploy thousands of DSL lines via one supplier, that supplier almost certainly will have to lease copper loops from incumbent carriers to reach these people.

I agree that there are probably a few too many CLECs demanding merely the right to be local competitors rather than offering real, new capacity. Some CLECs seem to be little more than a few guys who used to work at MCI WorldCom and a clutch of junk bonds in search of some facilities to offer, services to market and customer reps who know their stuff.

But without the ability to provision DSL services of their choice over copper loops from incumbents like SBC, even credible CLECs could be squeezed. Then we might be left with SBC offering DSL, AT&T offering cable modems and a giant WorldCom maybe combining MCI and Sprint's spectrum for fixed wireless. That's too few competitors, period.

Rohde is a senior editor at Network World. He can be reached at drohde@nww.com.

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