Advertisement
Articles
Advertisement

Bringing businesses and buildings online

Mon, 12/31/2001 - 7:00pm
Duffy Hayes

Will the unserved get served in 2002? Not unless some deep-seeded issues in the BLEC (Building Local Exchange Carrier) and MDU (Multi-dwelling unit) industries find remedy–and fast.

Currently, the unserved are the thousands of small- and medium-sized businesses in multiple-tenant office environments–seemingly left behind by providers who have shied away from offering services beyond the pipes that stop at a customer's premise. Most business tenants have found that getting anything faster than dial-up service is like pulling teeth, and a host of upstart companies have come and gone promising service to this problematic segment of the market.

In 2001, the shakeout was in full swing. Once high-flying providers like Teligent and Broadband Office wilted under the pressure of insanely negative balance sheets, and business plans that focused more on signing up properties instead of higher-value penetration rates. In 2002, as the capital markets make some kind of rebound, the shakeout should come to end, leaving a few select companies atop the heap. But the herd will be further thinned.

Who will survive the shakeout? Companies like EurekaGGN, Everest Broadband and Phatpipe have trimmed their burn rates and are leaner and meaner, and in 2002, they'll be focusing on the limited markets they're already in and searching for real estate partners that can guarantee them the high penetration rates needed to compete. No easy task, but these lean BLECs are attractive partners for building owners for a number of reasons–many are revenue-sharing partners, some market the tiered service and connectivity options as a valuable tenant amenity, and customer service and response is often right on site.

New in-building equipment should help these companies gain more solid footing over the next year. Vendors like Copper Mountain will be offering slimmed down, compact DSLAM equipment specifically for the MDU environment. Tut Systems has been the early MDU equipment leader; it'll likely continue to be with the release of new versions of the IntelliPOP system that will incorporate even more IP capability.

The other forces to be reckoned with are the incumbents–both telco and cable–who to this point have been more of a hindrance to the maturity of the MDU market. Telcos like BellSouth and Verizon subsidiary Verizon Avenue will continue to sign up real estate partners as an initial strategy through 2002.

As for the MSOs, they perhaps have the best opportunity to meet the market head-on; their HFC runs particularly close to many of the industrial parks and business centers that today are unserved. New optical and HFC technologies from upstarts like Jedai Broadband and Narad Networks should be part of some high profile operator trials this year. And 2001 saw the development of MSO subsidiaries like Comcast Business Communications, Cox Business Services and Adelphia Business Solutions. While they have laid their initial groundwork and made some regional inroads, they likely won't be able to extend their HFC out to all the small- and medium-sized businesses in their territories for a couple of years.

Advertisement

Share This Story

X
You may login with either your assigned username or your e-mail address.
The password field is case sensitive.
Loading