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Integrated T1 Progress Report
Thursday May 22, 2008,
03:32 am ET
CAREY, Wisconsin, May. 22 /Aaron Bashorun/ --
Is there a resurgence in the popularity of telecommunications providers that compares with
the late 1990's? The answer may surprise you. Since the crash of the Internet bubble,
struggling telecoms have seen Darwin in action as many companies were forced with the
choice of bankruptcy or forced consolidation. However, some companies chose the road less
traveled: innovation. By offering customers more for less, many small to medium size
business customers are finding that they can upgrade to integrated T1 service for the
same cost of five regular phone lines.
According to a recent study conducted by PK Communications Telecom Brokers Inc., the average
cost of a POTS (plain old telephone service) line serviced by the Bells (AT&T, Verizon,
and Qwest) have changed very little over the 10 year span from 1996, the year the
Clinton Administration signed into law the Telecommunications Act, to 2006. The real
change in the industry came in the T-carrier class of products, where customers can
get up to 1.5 Mbps of bandwidth and 24 digital phone lines all in one package. Some
CLECs like XO, TelePacific, Nuvox, One Communications, and even Covad are now offering
rates well below the $550/month level, making the change seem like a no-brainer to
thousands of customers.
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.
"I am very satisfied with my new XO dynamic T1" added Mike McLoude, a small business
owner in Santa Monica, California. "The flexible nature of the system allows me to
conduct business with the same efficiency as many of my bigger competitors, for less
than what they pay." Mr. McLoude is not alone - many Californians are seeing the
technology light and taking the leap of faith away from traditional TDM.
Will this train of innovation, lower prices, and services that add value to SMB's continue
to roll down the tracks of progress? It's all up to our government - and which political
party controls the FCC. Without the deregulation act of 1996, we would have never known
just how much the CLECs were capable of.
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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