Companies are building their businesses on other businesses. That is the future."
NETWORK ACCESS SOLUTIONS SHOWS CLECS A TARGET MARKET FOR BIG PIPES
Looking for new customers for fiber capacity? Network Access Solutions (NAS), a competitive local exchange carrier based in Sterling, Va., provides an example of where to look. The company just leased 45 Mbps ATM capacity from MCI WorldCom [WCOM] of Jackson, Miss., and Level 3 Communications [LVLT] of Omaha, Neb., to connect the digital subscriber line local loop services it sells up and down the East Coast.
NAS is using the 45 Mbps ATM service as a backbone that extends between Boston and Richmond, Va. The 499-mile network is fully redundant.
"Our goal is to use the backbone to provide a wide array of services to our customers," says Chris Melnick, chief operating officer of NAS. "Basically, we are looking at providing wide area frame relay to customers, and we are looking at providing extended DSL-type services to customers."
Michael Ruddy, a senior fiber optics analyst at Pioneer Consulting in Cambridge, Mass., says the telecommunications industry will see more deals between fiber capacity players and CLECs. "It makes very good sense for carriers' carriers to go after CLECs, which encourages these agreements," Ruddy says. "CLECs build metropolitan networks, but a carriers' carrier can come along and offer them the ability to connect these networks. The CLECs can then develop advanced services for their customers that span between cities."
"CLECs will use anything under the sun as a backbone technology to offer DSL [at the edge of a network]," says Craig Johnson, principal at the PITA Group, a consultancy in Portland, Ore. "CLECs that are looking to expand geographically without putting equipment in the ground will use any technology they can - SONET, DWDM or ATM. They probably won't care about the back end unless you are talking about differences in quality. The CLEC market is a very good space to attempt to sell backbone services in."
...The NAS Service Offering
NAS uses a combination of DSL, frame relay and ATM technology to deliver a service, CuNet, to its customers. DSL is used as the network interface to a customer, but frame relay also is used in the local loop. A permanent virtual circuit runs over the DSL line to connect the customer to one of NAS's digital subscriber line access multiplexers [DSLAM].
From the DSLAM back into the network, a subscriber's call is carried over ATM.
"We wouldn't want to brand this service either as DSL or frame relay," says Melnick. "What we have is a network that provides high-bandwidth services to our customers."
The cost model for CuNet has two components. Customers must establish what are called "base connections" to the service. These are connections that are intended to aggregate data calls from other users on the network.
NAS offers three base connection speeds. The 768 Kbps connection costs $250 a month, the 1.5 Mbps connection costs $500 monthly and the 45 Mbps link runs $3,600 monthly.
Customers can then supply their employees or offices with a basic service that can be used to dial into the base connections. The basic service speeds are 128 Kbps, 256 Kbps, 384 Kbps, 512 Kbps, 768 Kbps, 1 Mbps, 1.5 Mbps and 2 Mbps. The 128 Kbps service costs $99 a month, and
prices increase as bandwidth increases.
NAS is attempting to sell CuNet to enterprises and service providers. "Our target customer is the ILEC, CLEC, or even an IXC like AT&T [T], which can use us for local access to a customer," Melnick says. "Our customers are also medium to large businesses - someone that needs to connect up remote or small offices, or give telecommuters access to the LAN."
"NAS should be able to sell its service to other carriers," Johnson says. "There is a lot of subcontracting going on in the industry right now. For example, Level 3, [which] is supplying backbone capacity to NAS, is probably leasing that backbone from Frontier or Williams.
Companies are building their businesses on other businesses. That is the future."
NAS has offered CuNet for three months in Baltimore, Boston, New York, Philadelphia, Richmond, Washington and Wilmington, Del. The service will be offered in Norfolk, Va., and Pittsburgh by early summer, 1999.
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