Last week I published an update to my metro fiber and lit buildings list. Today I will begin looking at the collected data and try to make sense out of it. First though, I have switched the raw list to alphabetical order after several requests. I was getting a bit ahead of myself, ordering by ‘route miles per building’ was for this post. What I have learned from this metric is not who is the best or most successful in metro fiber, it’s not a race. Well, each business is in its own competition of course, but in this case it is usually against the ILEC more than anyone else on the list. Rather, what one sees quickly when ordering by this metric is the various business models in the sector. Let me order the list and add some color coding:
Wholesale Metro Access – In blue are companies that primarily connect central offices, carrier hotels, and similar large traffic destinations. Their customers have historically been other telecoms and internet service providers looking to extend their reach, but not so much to the enterprise (in some cases, ‘yet’). The focus on central offices means they often serve the CLEC industry, enabling others to compete with the ILEC only over the last mile. They often have regional fiber as well, hooking up their various metro rings.
Enterprise Metro Access – At the far other end of the spectrum are the metro enterprise specialists, in yellow. While they also hook up wholesale sites such as central offices and carrier hotels, these companies consider every building near their fiber to be a possible customer and build laterals all the time. They tend to be highly focused on their markets, and many are often little known outside of them. Only a few span markets in multiple regions.
Hybrid Intercity/Metro providers – In between and in green are national companies with substantial metro footprints, but with more intercity or regional fiber. While they are very different from each other in many ways, in this metric there are clearly similarities. The parallels come from their national nature, they tend toward customers with needs in many markets. Their usage of metro fiber is to aim for a high margin business with fewer competitors. They lie in between the other two cases because they seek to go beyond a wholesale footprint, yet don’t have as deep a local focus as others – of course some are more local than others. Of the enterprises along their fiber, they see only a fraction as immediate targets.
I’ll talk about each in more detail in later posts. The outlier here is Cogent Communications (NASDAQ:CCOI, news, filings) in orange, which is a case unto itself that I will also leave for another day.
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Categories: CLEC · Metro fiber
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Rob – You’ve done some nice work here categorizing the players and what their networks are primarily designed to reach. The lines are all fuzzy and some may be a little arguable, but I think you’ve captured some of the core differences in the focus of the metro fiber providers that helps explain some of the numbers in your report. Many observers often miss those strategic differences.
Thanks.
Yes, the lines are fuzzy, no doubt about that. I actually will need to reclassify Zayo as unique like Cogent but of course nothing like Cogent. They aren’t in the middle because of current focus, they’re in the middle because they are assembled out of both kinds of pieces.
The other thing is that this measures where providers have been, rather than where they are going. Some are now focusing differently – I’ll see what I can do to clarify in followups.
It will be nice when a few non-ILECs that own fiber figure out, as you said, that the ILEC is the only competitor — not one another.
Another interesting statistic would be understanding on this list, who provides an open access platform. What I mean by an open access platform is that you provide capacity/connectivity AND dark fiber leases across the entire footprint – not selectively. Such closed footprints are proprietary and do not contribute to enabling competition or consumer choice.
It’s just my opinion, I do not believe a nickel of Federal Funds should go to a carrier that does not have an open access platform. By definition, this eliminates the ILEC and cable companies from receiving funding.
I also changed the title to “classification attempt” rather than try to claim finality. I’m still hunting for information from some of these guys, and better means of classification may present themselves down the line.