Earlier this month, I took a look at one of the more exotic broadband stimulus applications – XO’s proposed Northern Lights from Washington to Illinois. As it turns out, 360Networks isn’t too pleased with this concept, as detailed in an open letter to Congress. Their own network covers a largely similar route, which derives from the old Touch America build back in the bubble that many may have forgotten about. Just how similar is it? Here is a 360Network’s map of the overlap:
Hmmm, very similar actually, diverging only for parts of Washington and Minnesota and then on the final approach to Chicago.
360’s complaint of course is that XO would be using federal dollars to overbuild existing capacity, and not just of an ILEC’s. Any opinions out there? Does 360Networks have a point here?
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Categories: Fiber optic cable · Government Regulations · Internet Backbones
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Strong case made by the map. This is why the govt needs to stay out of the markets. Having a unique route is a strong value proposition. If XO gets this route built (with taxpayer help), 360’s pricing power will evaporate.
This is not unlike the more common complaint aired by incumbents that municipal INets and b-band builds enjoy an unfair leg up. The one difference being, munis usually resort to their own networks when the market isn’t working for them. Was the market being satisfied by 360 and whoever else runs along that railroad track? That’s another thing… is there ample spatial separation between the two routes to justify a claim by L3 that diversity is being served? Or are they co-tenants for most of the length, mostly sharing the same trenches and easements?
Of course I flubbed my earlier post, but only semi-consciously… I meant XO, not L3.
i love the fact that a company (360) that got a network at no or low basis from a BK and telco bubble is upset that another post BK provider (XO) is seeking money from a stimulous handout bubble… neither of these folks actually have a real, paid basis in their assets. because the market doesnt support building un needed networks into Billings and Fargo, etc. hilarious
You have to love the gusto of Carl Ichan.
He puts in 82 million in a deal and tries to have the tax payer give him back 132 million-all to help extend Long Haul capacity to Indian tribes. Unfortunately though, it does not really help them as 360 seems to have plenty of fiber on that route which they will give up to the LH providers coming through the area. Too bad the XO executives didn’t come up with a more creative design on which could REALLY leverage Carl’s cash-cause he loves to play this game!
Carl’s paying them all that money and they can’t come up with an original thought and do better than that? But that’s always been the problem at XO, they can’t think outside the box.
I hope the Obama administration and NTIA does what they said they were going to do and drives new small business (with original thoughts) with that 123 Million and develops projects that fill REAL gaps in type 2 fiber market where traditional LEC and incumbents won’t give up the asset, where it’s really strategic, served or not!
Or does the “golden rule” still apply, ala “he with the gold makes the rules-and also gets more (regardless of the idea’s they bring to the table)”. We all will find out!
Oh yeah, quick numerical correction-that’s $206M from Uncle Sam( Obama and the taxpayers)– and aprox $84M from Uncle Carl (XO) on this one.
Carl generally gets what he wants-regardless. Can the Obama Adminstration and the NTIA really hold the line here and do they really want to?