A CLEC of CLECs

Cutting through the VoIP hype, one company says that, with the right CLEC alliances, a voice company can deliver network agnostic voice services and applications anywhere in the U.S.

by Alex Goldman ISP-Planet Managing Editor [November 18, 2004]

Sure, you've heard of aggregators, sometimes called "networks of networks." Aggregators allow ISPs to buy access on several different networks through one company. The aggregator, not the ISP, handles the network relationships.

When we heard about Bellevue, Wash.-based Accessline, a voice services company serving business customers of all sizes, we decided we wanted to learn more about how this company leveraged existing CLEC infrastructure to deliver innovative voice services over both IP and TDM.

Kent Hellebust, Accessline CMO (that's Chief Marketing Officer), says the company focuses on "all three segments of the business market", by which he means large business (such as Fortune 500 companies), SMB, and SOHO.

The company is focused on delivering applications, which are hosted in its four AccessLine Application Centers, located in Los Angeles, Seattle, Chicago, and New York.

Through agreements with CLECs, the company claims access to 85 percent of the top 100 metro areas.

It is precisely in metro areas, where the dot bomb bust built the most, that prices are good. Nathan Wilkes, AccessLine director of carrier relations, explains how this works. "During the boom, CLECs all built out huge networks and put a lot of money into those networks," he says. "But, unfortunately, all built into the same markets."

He adds that the CLEC buildout shows the companies should have worked on applications in addition to networks. "They should have geared their services less for T-1 replacement and instead to creative solutions for ISPs, for virtual fax customers, conference calling with local numbers, and all the other products that AccessLine can leverage because we have a local number gateway provided by a CLEC."

"We leverage what's already been built. It provides great speed to market. We just need to negotiate with a CLEC to add a new market, which is a great alternative to a huge network deployment. If a customer asks for service, we can add service in an area in 30 to 60 days."

Hybrid vigor
Using a hybrid of traditional TDM and cutting edge VoIP technology, Hellebust says, avoids a key barrier to VoIP adoption. "Business customers have made it very clear that they are not interested in a 'rip and replace' strategy where you have take out all the phones and replace them to realize the advantages of VoIP. Downstream, if they choose, they can do a SIP installation and obsolete their PBX and phones, but when they sign up they do not have to replace any on-prem equipment."

Instead, the company can use its gateways to translate calls into IP upstream and route the calls to its Application Centers.

The company's data partner is SAVVIS (which is based in both Herndon, Va. and in St. Louis, Mo.). "They're totally targeted on the business market, as are we," enthuses Hellebust. "Business customers require both a good ROI and reliable QoS, and SAVVIS is known for focusing on QoS. Its network defines our VoIP quality."

Working with CLECs
For TDM service, AccessLine works with CLECs like Stockton, Calif.-based Pac-West Telecomm. The company itself aggregates local CLECs to build its coverage area. "Early on," explains Reid Cox, Pac-West vice president of corporate development and investor relations, "we made the call that the price of transport would be low. We own just a few feet of fiber between two buildings."

George Sutcliffe, Pac-West senior director of marketing, explains that the company's SuperPOP architecture is central to delivering lower costs. "It's a smart build that aggregates switching to a switching center. We own the heavy iron in that SuperPOP and lease lines out."

So AccessLine's national network goes through Pac-West regionally, and Pac-West in turn leases T-1 lines or similar transport out to individual sites.

"AccessLine is leveraging new technologies to bring new products to customers," says Sutcliffe. "Pac-West has helped many different providers deliver what they want to deliver."

Cox says the CLEC population is stable, having decreased considerably since the boom, and that's good news for CLECs and their customers. "Your menu's not as big as it used to be, but you're dealing with companies that have more of a track record than they had a few years ago. More time has passed to allow you evaluate companies' business models, especially with publicly reported financials. The weaker have succumbed. It's not over, but certainly the herd has thinned."

Pac-West and other CLECs will continue to focus on taking market share away from the dinosaurs that have the most. "None of us like sharing 15 percent of the market while the ILECs hold 85 percent of it."

— End