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Only the FCC Can Stop CLEC Momentum
Friday December 09, 2011,
07:39 am ET
LAKEVIEW, Michigan, Dec. 09 /Kiersten Thomas/ --
Higher productivity for small to medium sized businesses is just around the corner thanks
to commercial grade broadband services that are now being delivered at a fraction of their
previous cost. Due to the ever increasing competitive marketplace and a mad dash to consolidate
networks, telecoms are offering their premium business services to small businesses for a fraction
of what they used to cost just a few years ago. Businesses who use more than four regular phone
lines can now upgrade to dynamic integrated T-carrier circuits for the same price.
One might think that, given the cost - benefit analysis of the integrated T1 value
proposition, more businesses would be changing over to the new platform. However,
the rate of adaptation is rather slow. Rob Butler, head of the Telecommunications
Research Institute, thinks that "phone companies have a problem with trust amongst
their user base. For many years, customers have dealt with increasing rates, long
hold times, and frustration in general. Now, it appears, the ice is finally starting
to melt and customers are opening themselves up to new technology.
Ultimately it all comes down to basic economics. Whenever a technology can offer
more features for less money that what businesses are currently paying, it's just
a matter of time before the flood gates open up with companies wanting to adapt
the new standard. According to the Telecommunications Research Institute, headquartered
in Miami, Florida, the mass migration to dynamic integrated service offerings
is only being held back by a lack of education and/or the ability of carriers to
reach their target market. "Most people are leery of advertising and solicitations
by phone company salesman." comment Bill Bradley, analyst.
The early adapters of this new technology have realized a cost savings that helps
them be more competitive in the market space. By saving hundreds of dollars each
month, which equates to thousands of dollars per year, small businesses are able
to do more while spending less on their telecom bill. This savings allows for
hiring of additional staff, upgrading equipment, and other activities that make
the enterprise more productive and profitable. Many in the industry see the
lack of mass adoption of this new technology as just shear ignorance and/or
a lack of trust for telecom sales people.
But how much longer will we continue to see improved technology, services, and prices?
It's all in the hands of the Federal Communications Commission, as they have the power
to sqwash the CLECs by proxy. No wonder AT&T and Verizon are the two biggest lobbying
powers in Washington. It makes you wonder what kind of services they would be able to
offer had they plowed that money into R&D instead of politics.
Change does not happen quickly in an industry as so heavily regulated as Telecommunications.
Recent industry consolidation has provided huge alternatives to the incumbents, who
are now under pressure to keep up with new technologies while charging better prices
to retain and attract new customer bases.
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