Year in review 2011: The stories that dominated the wireline industry
As we say goodbye to 2011, a year that was certainly another time of change and transition in the wireline segment of the telecom industry, we wanted to take the time to look back on some of the major story lines of the past year.
During 2011, we believe there were five major subjects that are part of the wireline industry's ongoing transformation from a voice-only network to one that supports a growing set of IP-based consumer and business services:
- 100G takes flight: Driven by new advancements in coherent optics, a growing base of service providers have decided to sidestep a migration to 40G and go straight towards 100G in their core IP and optical network infrastructure. One of the clear aggressive carriers in this domain was Verizon (NYSE: VZ) with seven additional routes updated to 100G on its IP network this fall in addition to upgrading 10 of its network routes with coherent optical technology. Outside of Verizon, other notable 100G deployments include a group of savvy Canadian (MTS Allstream and Shaw), European (BT and P&T Luxembourg), R&E networks (Internet2), and even one city (Washington, D.C.).
- IPv6 readiness ramped up: While the topic of IPv6 addressing has been around for over a decade, it was really only in 2011 when IPv4 address exhaustion began to show its head and drive service providers, vendors and industry groups to create new awareness about being ready to make the IPv6 transition. To test out IPv6 in a live Internet environment, the telecom and IT industries alike held World IPv6 Day. Held on June 8, the event was a dress rehearsal where service providers tested the effects of more than 430 Internet content providers running their websites in a dual IPv4/IPv6 mode.
- Usage Based Billing (UBB): Claiming that heavy use of a broadband line by what are sometimes referred to as "bandwidth hogs," U.S. service providers including AT&T (NYSE: T) and Frontier (NYSE: FTR) put in place usage based billing (UBB) rules that would limit the amount of bandwidth users could consume in a given month. Likewise, in Canada, the Canadian Radio and Telecommunications Commission (CRTC) initially allowed Bell Canada (NYSE: BCE) to implement a UBB plan on wholesale customers and consumers, but later revised its proposal.
- USF/ICC reform: This fall the FCC put forth its long-awaited proposal to reform its Universal Service Fund (USF) and Inter-carrier Compensation (ICC) systems. Seeing broadband as a the future, the FCC's proposal with the $4.5 billion USF program, which had been primarily used to fund local phone service networks in rural areas, would be to use the fund to bring broadband to underserved areas. As expected, the new rules are already being challenged by large telcos, including AT&T (NYSE: T), and industry groups such as the National Telecommunications Cooperative Association (NTCA). Set to be heard in the 10th Circuit Court of Appeals in Denver (CO), the panel consolidated 13 separate lawsuits from telephone companies and state public utility commissions into one proceeding.
- Verizon's strike woes: With Lowell McAdam taking over the keys of the Verizon (NYSE: VZ) kingdom in August 2011 as the ILEC's CEO, one of the key goals of the former Verizon Wireless CEO was to streamline the service provider's business and make it more entrepreneurial. In carrying out his plans, McAdam asked the service provider's two main unions--the International Brotherhood of Electrical Workers (IBEW) and the Communications Workers of America (CWA)--for a number of concessions on pension and healthcare contributions. What ultimately followed was a two-week strike that ended on August 14 with unions and Verizon officials still trying to hammer out a new contract.
In this special year-in-review issue, FierceTelecom looks back at all the signature headlines and events that shaped the wireline telecom sector in 2011 and set the stage for 2012. With that in mind, I encourage you to take a look and make suggestions about other trends and story lines you thought were newsworthy in 2011 and could be things to watch in 2012.--Sean
P.S. FierceTelecom will be on a publishing break for the holidays. We will be updating the website with any breaking news, but will be back in your inbox Tuesday, Jan. 3, 2012. Enjoy the holidays and have a Happy New Year!