We wanted to post something entertaining, but also educational. This is a great analogy of the fiber market from Robert Powell, posted in Telecom Ramblings at the end of last year.
The simple question is: if each US network operator was a warship, which type would they be?
- The Aircraft Carriers — These are the giants with consumer wireless businesses. Their fiber networks are huge, but the captain is thinking about how to use it to enable the fighters on its deck and many people forget about the other firepower it has. They are immense and project power better than anyone, but take years to turn around. AT&T, Verizon, and Sprint.
- The Battleships — These are the fiber operators who have grown very large via consolidation, but don’t directly participate in the air war. They have the scale to really do some damage if they could just get pointed in the right direction before the target moves again. Level 3, CenturyLink, Windstream.
- The Cruisers – Still small enough to be fast, yet with big enough guns to be truly dangerous if the captain is skillful and the target is sufficiently focused. But if not, then it’s easy to wind up going the wrong direction at times. XO, Zayo, Integra, tw telecom.
- The Destroyers – Small but agile and faster than anything else in the water, these guys reach the action first and try to take the prize before the bigger competition is able to shift and take it away from them. Fearless in taking on larger competition, but preferably in close quarters where the other guys can’t focus all their firepower and shallow waters where they can’t be followed at all. Cogent, Sidera, Inteliquent, Lightower, Hurricane Electric, Hibernia Atlantic, Mammoth Networks and many others.
- The Frigates – In the old days a frigate was a clearly identifiable type of warship, but now it’s trying to find an identity. It’s big enough to look dangerous, and who knows maybe it will be — or maybe it’ll still be stuck on convoy duty next year. These are the owners of former CLEC assets looking to become cloud-powered managed service providers. Earthlink, MegaPath, Cbeyond.
- The Submarines — You don’t quite know where they are, or what they’re planning to do next, but for now they aren’t threatening anything new. Specialty players like Spread Networks and NeXXcom, and foreign-based players like America Movil, NTT, Tata, Teliasonera.
- The Coast Guard — Tied to defense of civilian assets, and rarely venturing into battle outside their assigned patrol region. Frontier, Fairpoint, and other rural ILECs.
The list is not comprehensive of course, and just for fun! Any additions? Again, focusing on the US market only – could do the same thing in Europe or Asia I guess, but it gets messy if you try to do the whole world at once since the relationships between incumbents and competitive carriers varies widely across the world. And yes, I’m mixing different asset types in here, with both fiber-light and fiber-heavy operators mixed willy nilly.
Author – Robert Powell, Telecom Ramblings – November 9th, 2012.