CLEC Strategy Thoughts

Peter : On Rad's Radar?
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

CLEC Strategy Thoughts

Talking with a mutual fund manager today about CLEC Strategy. The interesting point that was made is that if you don't own your own facilities is your business model short term?

Interestingly, if you own your own facilities - whether that is fiber, MTU, or wireless - then you certainly have an advantage. To get there, you need to sell Dense. Then convert to facilities from rented plant. This was the idea behind UNE-P, which th eCLEC's failed to follow through on.

They are even doing agin now by selling to anyone regardless of location. The overall strategy has to be to sell UNE-L then move to your own plant as soon as you can. Special Access services are expensive and eat up CLEC margin, even at 40% margin the difference between UNE-L costs and Special Access won't work.

The other key is your sales team. Most CLEC's and other companies competing with the ILEC's have traditional sold on price. Order taking. Now that the ILEC's are de-regulated they can price out at or below CLEC rates. Uh oh! What's a sales drone (order taker) to do?

Now we have to solution sell. Agents have been doing that but even agents have an issue learning IP, Storage, eCommerce, Managed Services, Desktop services, Cloud Computing, SAAS, etc.  It's too much. 

The CLEC with the best trained sales team - and the best services portfolio - will win.

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