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The Evolution of Integrated T1 Service
Tuesday January 31, 2012,
04:28 am ET
KIMMINS, Tennessee, Jan. 31 /Dolf Olviederlag/ --
For many small to medium size businesses, higher productivity with relation to their broadband
and voice services is just around the corner. Thanks in part to the recent price reduction trend
in the industry, carriers have deemed it necessary to consolidate in order to offer more services
at a lower cost than their rivals. Overlapping networks have been consolidated into leaner, more
feature-rich versions of their previous selves, dramatically lowering the price small businesses
pay for the popular dynamic integrated T-carrier (T-1) lines that combine local voice and
high-speed Internet service into one connection.
Min Lieu owns a small insurance agency in Tennessee. Five years ago he signed up with
XO Communications for a TDM-based integrated T1 line for $870/month, which did not
include local or long distance calling. Recently, he was offered XO's version of
a dynamic circuit called "XO Flex" for half of the price he was already paying.
"I would have been a fool not to take the deal" stated Mr. Lieu. "I'm able to
add headcount with additional voice lines, without any increase in expense or
degradation in high-speed Internet performance."
"Even though we have been witnessing the re-consolidation of AT&T, we will never go
back to the dark ages of telecom where customers were stuck with bad customer service
and high prices" commented Troy Karlson, telecom analyst for e-STAR. "The competitive
local exchange carriers (CLECs), all whom own their own networks and compete directly
with the Bells, have created products such as dynamic T1 service that enables its
customers to connect to the Internet at 1.5 MBPS and have up to 24 regular voice lines,
packed with a feature-rich suite of add-ons, all for under what it costs to have
6 regular phone lines from Qwest/AT&T/Verizon.
The same basic economic model described in the book "Blue Ocean Strategies" is now being
applied to telecommunication services being offered to small businesses across the country:
more value for less money. According to many industry watch dogs, hundreds of thousands
of business will dump their POTs lines in favor of dynamic integrated T1 service within
the next 12 to 24 months, saving money in the process. With the introduction
of sub-$475 dynamic integrated T-service, customers are now able to receive up to 1.5 MBPS
of high-speed Internet with 24 digital phone lines all on one line, for less than what they
pay now for 5 regular phone lines" Stallions continued.
Looking in the crystal ball of the future, it is clear that new an innovated services
being offered by the few super-CLECs remaining will drive innovation higher and prices
lower. New technology is being pressed to the forefront by lower prices that the mainstream
of small businesses everywhere can comfortably afford.
Hopefully the CLECs can continue to push the boundaries of innovation and economics.
The only thing that can keep them from the promise land is the gatekeeper of competition:
the Federal Communications Commission, and the huge Bells (AT&T and Verizon - that's you)
who make it a point to spend more money lobbying in Washington DC than Exxon Mobile.
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