CenturyLink's GPON effort drives business opportunities in former Qwest territories

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CenturyLink's (NYSE: CTL) acquisition of Qwest may be long behind it, but according to Clay Bailey, senior vice president of Operations for CenturyLink, those markets are becoming a key target to win back small to medium businesses (SMB) with its 1 Gbps GPON-based service.  

A number of the former Qwest business markets declined to 15 percent market share due to SMBs churning to a CLEC or a cable operator.

Speaking at the Raymond James 35th Annual Institutional Investors Conference, Bailey said the Qwest markets afford two benefits: a large SMB base and much of the market is already connected to its network.

Unlike new services like Prism TV, the GPON-based 1 Gbps service is less capital intensive because it can use existing fiber that already passes area businesses.  

"The great thing about that strategy and that space is we're leveraging our existing assets," Bailey said. "Compared to things like our Prism deployment, there's not as much capital required to get those speeds out to those customers."

Evidence of this trend can be seen in Salt Lake City, where it recently began offering its symmetrical 1 Gbps fiber-based services to Salt Lake City-area SMBs that reside in multi-tenant unit (MTU) office buildings.

Besides offering higher speed, the 1 Gbps service can serve as a foundation for its growing set of cloud-based services, including its new cloud-based Managed Office bundle.

"We know that it will drive incremental services for us," Bailey said. "The 1 Gbps symmetrical speeds will allow customers to access cloud services that they have not been able to access in the past."

Over the past year, the telco added more than 1,000 fiber-fed buildings into its multi-tenant unit (MTU) program.

While he could not provide specific targets, Bailey said that it plans to continue to extend the 1 Gbps service inside the existing Qwest territories and other markets this year and next.

"It will eventually be across the whole network, but right now we're focused on the legacy Qwest territory in terms of deploying the services, but in 2014 we'll start expanding that across the footprint," Bailey said. "The great thing about the fiber expansion in the business space is that we have a lot of fiber in those metro areas now so really all we're doing is leveraging the existing fiber we already have to provide those 1 Gbps speeds."

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