Hi Ray,
I think we've been to this movie before. A glut of competitors soon, definitely. Having hundreds of competitors, all running over the same routes, or just about, has the effect at some point of hand cuffing themselves in their administrative tasks. I say this because of the need for more bandwidth, actually, and the increase in the number of points of interconnection that they must transit, after you are done with all of the handoffs that must take place. And every provider has their own back office operation, their own network management platforms, and their own service level agreements.
This model stands in contrast to the "one" bell system of the past, where you were assured end to end hand holding. I'm not advocating a return to the latter, I'm simply using it to demonstrate a point.
A glut of bandwidth, per se? I don't think so. The stuff is just implemented in a lopsided manner and in many of the wrong places. Rather than arm wrestle with local franchising authorities, the new fiber ventures have chosen to take the path of least resistance and deploy their silica over railroad easements, state- and federal- highway rights of way, and across vast bodies of water.
In the article concerning 360's Maffei's chagrin over the perceptions by investors that there is going to be a bandwidth glut, a mention is made to one of the reasons: The growing bottleneck that exists in the last mile, preventing end users from accessing (super-dsl and super cable modem, my addition to the script) bandwidth that resides in the core and to specialized content providers. In some previous posts I've at times suggested that just the opposite holds true due to the uptake in DSL and Cable modem. And I still maintain this position, where www surfing and mom and pop ISPs are concerned. But this phase is temporary and only looks at a single slice of the overall pie. It's my opinion that there are [will be] far greater opportunities to deploy bandwidth that are not even being addressed or tapped right now.
These will exist at the next level of application deployment, because there is insufficient bandwidth mass right now where it is needed [at the doorsteps of end users] in order to justify them.
So, in a way, I suppose that this could be equated to a temporary glut in some providers' cores. But then we get to talk about "when is bandwidth actually bandwidth?" and "is bandwidth bandwidth if it isn't lit?" But that's another discussion, although I should note that these factors and contingencies do play into the final calculus.
This is one of the reasons why I think we'll see more interest by the interexchange and fiber baron types, resulting in their investing in last mile fiber.
Because, at some point it'll be the only way they have to dump their load. That is, by ensuring that end points (both residential and small business subscribers) are connected to the network with fiber.
FAC |
