Level 3 Communications is aware of Charter and Comcast’s larger business market ambitions, but the service provider isn’t exactly scared of their presence either because cable operators have a long runway to catch up.
Jeff Storey, CEO of Level 3, told investors during the Goldman Sachs Communacopia 2016, the service provider has a set of product and network assets that other competitors like Comcast can’t match.
“Cable is a good competitor and I am sure that Comcast customers are receiving a good experience, but if you look at the reasons why customers are buying services from Level 3 it’s the scope of the network,” Storey said. “We have connectivity not just within one market, but throughout the U.S. and across the Atlantic, down through the Caribbean, South America and we can go to where our customers are.”
In addition to network presence, the service provider has a large breadth of fiber and IP-based services.
“We can sell transport, we can sell IP/VPNs, IP and media distribution services so we bring a breadth of product portfolio that others can’t compete with,” Storey said. “At one point, 75 percent of our revenue came from wholesale and 25 percent came from enterprise and today 75 percent is enterprise and 25 percent comes from wholesale customers.”
Level 3 itself has continued to expand its domestic and global reach, surpassing incumbent competitors like Verizon.
Following its acquisition of tw telecom, Level 3 surpassed Verizon as the second largest domestic Ethernet provider based on port shares sold, according to Vertical Systems Group’s domestic Ethernet Leaderboard. More recently, the service provider took over Verizon’s spot as the fifth largest Ethernet provider on VSG’s global Ethernet Leaderboard as it expands service availability in Europe and South America.
Rosemary Cochran, principal of Vertical Systems Group, told FierceTelecom in a previous interview that “Level 3 had highest growth in first six months, driven by its presence in Latin America and Europe.”
Still, it’s hard not to notice how big of an impact cable is making in the business market, particularly for Ethernet services.
Take Charter Communications. After purchasing Bright House Networks and Time Warner Cable, Charter was also able to take over Verizon’s third place ranking on VSG’s domestic Ethernet Leaderboard.
The acquisitions of Time Warner Cable and Bright House enabled Charter to immediately gain a larger fiber and hybrid fiber coax footprint to target more small, medium and large businesses with Ethernet services.
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