FWIW, Mike & Thread:
This morning I first learned how the co-loco issue is going to be handles at the RT -- at least as Pronto is concerned. The answer is that there will be no co-location rights since the RT will NOT be OWNED by SBC, but by a separate entity known as "ASI." I don't have all the specifics, but based upon what was provided to me it looks very similar to a sale-leaseback type of structure.
As a separate operating entity, ASI objective will be to maximize revenues, & thereby will lease space at the RT on a "first-come, first-served" basis. Sure SBC will pay the same lease rates as the CLECs, but how will SBC enjoy the fruits of the venture when it comes to ownership in ASI. The details are not available, but I think ownership in ASI will represent SBC ROI in Pronto, who in-effect is being contracted by ASI to build the RT infrastructure.
Nevertheless, I think the goal here is to structure a business model whereby the CLECs will be able to compete with the incumbent for DSL consumers based competitive DSL pricing models. However, IMHO, SBC is an extremely shrewd company, & will likely use its existing market power upfront to consume as much capacity in each RT as possible & limit the ultimate "co-location" availability to CLECs.
Is the following hypothesis consistent with the 1996 Act & Congressional & FCC policy regarding encouraging competition along the loop? I would venture far enough to say yes. In the instant case, SBC is establishing a business model that will allow the CLECs to compete for customers on a level playing field, with both incumbent & CLEC have the same cost structure when it comes to provision DSL along the loop. It is obvious that the incumbent will command a large market presence at the outset, & perhaps rightfully so. But if competitive forces are truly allowed to compete, prices will drop, & the consumer will gravitate to that provider providing the best service at the best reasonable price. If, for example, the CLECs are successful, then I would think the demand for incumbent gear would diminish & it would be in the interest of the independent RT operator to accommodate market demand & reallocate space at the RT accordingly.
In a hurry here, so gotta go, but I welcome comments from all copper & coaxial pair ends. |
