Showing posts with label T1. Show all posts
Showing posts with label T1. Show all posts

Tuesday, January 8, 2008

Business Fiber: Better, Not Good

By some measures, business customers have better fiber access than they used to. By other measures, most businesses still do not. One has to be in a building with enough private line potential to support something on the order of four T1 circuits, says McLeodUSA CEO Royce Holland. And as recent data from service providers such as XO Communications shows, most business customers are not in those buildings.

In fact, despite strenuous efforts by all sorts of companies that make a living providing fiber-based services to business customers, lower T1 prices over the last decade arguably have made the "fiber to building" business case tougher. Lower T1 prices obviously reduce the amount of recurring revenue any provider can hope to make from a single site.

The countervailing trend is higher demand for optical services such as Ethernet. Though the cost of hardware has declined over the last 10 years, the cost of installation and construction has not, and that's most of the cost.

Friday, January 4, 2008

Carphone Warehouse in Play?


Shares of Carphone Warehouse Group, Europe's largest mobile handset retailer, rose the most in more than five years in London trading on speculation the company may receive a takeover offer, says the Bloomberg news service.

"Rumors about bid interest from Vodafone and Best Buy have been doing the rounds for some time," says Jimmy Yates, a London-based trader at CMC Markets.

What is interesting is the strategy context driving some of the rumored suitors. Best Buy has a small stake in Carphone Warehouse, which operates 2,400 stores across Europe. Best Buy also is collaborating with the U.K. chain to boost sales of mobile products in the U.S. Best Buy stores.

So you might argue that Carphone is simply a way for Best Buy to expand its footprint in its current business.

But keep in mind that Carphone also has 2.5 million Digital Subscriber Line customers. It also has a backbone network. Consider that Best Buy's Geek Squad is in the technology services business.

And recall that Best Buy owns Speakeasy, a provider of business-class broadband access and voice services in the U.S. market. Sure, Best Buy can grow its retail footprint. But by acquiring Carphone Warehouse, Best Buy makes an even bigger bet to become a more-significant provider of broadband access, business voice and mobile services.

For Best Buy, its core business is more than acting as a retail distribution channel. It is a service provider. Owning Carphone Warehouse would only deepen that commitment.

Now consider the possibility that Vodafone might acquire Carphone Warehouse. The idea there is not so much that Vodafone wants to become a mass market electronics retailer. Vodafone, long a dominant wireless service provider, now must also become a multiple-services provider, and broadband-based services provided over wireline networks are part of the vision.

Carphone Warehouse would give Vodafone much more heft, in that area. It might not strike you as significant that wireless and wireline services are converging. It might be a bit more surprising that retailers are moving from simple channel partners into the service provider business.

Friday, December 21, 2007

Business Broadband: Cable Modems Significant

Businesses use all sorts of access technology, if a recent Aethera Networks poll is to be believed. As you might guess, more than a quarter of business users have Time Division Multiplex access while more than a third use Ethernet of some sort.

You might not be surprised that more than a quarter use cable modems or Digital Subscriber Line, especially business-class DSL. What is interesting is that cable modem technology shows up in such surveys of the small business space. In fact, at least some business owners tell me they replaced T1 lines with cable modem service, and are happy they did.

Tuesday, August 7, 2007

Private Line, Ethernet Might be Complementary

One of the confounding thing about "public network" services and platforms is that although many new services logically should displace older services, quite often they do so only in part, acting mostly as a brake on the growth of the legacy services, but not displacing them.

Ethernet and IP, for example, "logically" should replace older private line services based on SONET, SDH or optical carrier. Ethernet offers vastly lower price-per-bit performance and is transparent to the connectionless nature of IP. SONET, SDH and optical carrier can be made to encapsulate IP packets, but at the risk of additional overhead, cost and payload efficiency.

In fact, as IP-based broadband services proliferate over wired and wireless networks, one logically expects that older connection-oriented transport protocols will wither. But nothing in public networking ever seems to work so linearly. Oddly enough, as real time apps start to drive broadband services, connection-oriented transport has appeal, as that's what such protocols were created to do.

Over the past several years there also has been much emphasis on the role of wireless backhaul in driving new demand for private line capacity. Which might strike you as odd, given the relatively small percentage of total private line sales that particular application represents. Of course, there are other forces at work.

Though it clearly is broadband demand that is driving wireless backhaul demand, that demand is spread across traditional private line, Ethernet over copper and optical connections.

"Private line emulation" over optical or metallic media, for example, often makes sense. So does encapsulation of connection-oriented traffic inside a connectionless transport. Though "converged networks" are the future, today it often makes sense to add high capacity connectionless bandwidth for 3G and 4G services, but leave the connection-oriented voice on a separate logical network.

"Private line" sales can grow even as IP bandwidth grows in the backhaul application because a huge existing voice revenue stream has to be supported as incremental broadband apps using IP are layered on. Still, wireless backhaul is a fraction of total private line sales.

So why the buzz? Volume. A single sale to a wireless network provider can involve thousands of sites. A service provider obviously can make a lot more money selling one customer thousands of T1s or hundreds of optical carrier or Ethernet links, rather than thousands of customers single T1s.

Then there is the matter of urgency: wireless carriers have an immediate need that won't wait, and have to put up hundreds to thousands of links at a time. Wireless backhaul is really important to sellers because a handful of buyers represent such enormous volume.

Sunday, July 8, 2007

Midband Ethernet, Everything Else is Growing...

It has been a good year for suppliers of midband Ethernet connectivity equipment and access services. Heck, it's arguably been a good year for access services, period. Where providers used to get asked for T1s, they now get asked for DS3s. Where they used to get asked for DS3s, now customers are asking for optical connectivity. It's the same story on the consumer access front: more bandwidth, more often. That's what video will do to a network.

"Tokens" are the New "FLOPS," "MIPS" or "Gbps"

Modern computing has some virtually-universal reference metrics. For Gemini 1.5 and other large language models, tokens are a basic measure...