Sizing up FierceTelecom's 2010 wireline predictions

Sean Buckley, FierceTelecomWhile today's issue of FierceTelecom will be dedicated to our 2011 predictions, I think it's a good time to see how we fared in 2010.

Following one of the worst economic meltdowns since the Great Depression--one that many businesses are still recovering from--2010 was a year filled with new possibilities and preparation for upcoming technology migrations.

So let's take a minute to look at how our predictions panned out in 2010:

  • Qwest becomes an acquisition target: Well, finally after rumors died down that Qwest (NYSE: Q) was going to sell off its long-haul network, CenturyLink (NYSE: CTL) swooped in and made a $22.4 billion stock deal to snap up of the last remaining independent remnants of the formerBell System. When the merger of the two companies is complete, the new company will be a powerhouse service provider with a combined 173,000-mile fiber network and local service presence in 37 states.
  • Cable gets down to business: Cable continued to make progress in winning more of the SMB market over its existing HFC in 2010 while building out fiber network facilities to meet potential wireless backhaul targets. Perhaps one of the biggest indicators of cable's business success was seen by Cox Business, which reported that it reached its $1 billion revenue goal in 2010. Having already serving businesses and other carriers since 1993, this goal was built on 17 years of experience in serving carriers, businesses and government agencies. Also active in 2010 was Comcast (Nasdaq: CMCSA), which continued to ramp up its SMB efforts to battle the ILECs. Not only did the Philadelphia-based MSO acquire Chicago-based CLEC Cimco, a report in July emerged that it was building out facilities to target larger business customers and wireless backhaul opportunities.
  • Wholesale wireless backhaul bonanza: One event that boosted the profile of the wholesale wireless backhaul market was Verizon Wireless' move to leverage not only its wireline brother Verizon Communications (NYSE: VZ), but also a host of alternative fiber providers to provide wireless backhaul for its 38-city LTE broadband wireless launch. Included in Verizon Wireless' backhaul mix both incumbent providers (CenturyLink and Qwest), but also a number of competitive fiber players (FiberTower, PalmettoNet, and Telecom Transport Management) to provide connectivity outside of its core wireline regions. At the same time, a host of other players beefed up their respective fiber footprints organically and through acquisition. FiberLight, for one, won a contract to provide wireless backhaul connectivity to WiMAX provider Clearwire (Nasdaq: CLWR) in four markets. No less aggressive were Windstream and Zayo. Already committing $20 million to expanding its own existing fiber footprint, Windstream decided to purchase Q-Comm, a company that only included CLEC Norlight Communications but fiber provider Kentucky Data Link. Finally, Zayo not only expanded its own internal fiber network holdings from previous acquisitions, but also acquired both American Fiber Systems and AGL Networks-two moves that inspired it to create its new dark fiber unit Zayo Fiber Solutions (ZFS).
  • Middle Mile March: Looking to provide necessary network backhaul capabilities to smaller service providers that have had little choice to buy expensive circuits from the larger incumbents, a number of communities broke ground on middle mile network projects. With broadband stimulus dollars in hand, a number of consortium-led and individual efforts to build new community-wide middle mile networks got off the ground in 2010: Independent Optical Network's (ION) middle mile network, Level 3 (Nasdaq: LVLT), Open Cape and Maine's Three Ring Binder Network. After fighting legal challenges from incumbent operator FairPoint Communications (Other OTC: FRCMQ.PK), the purveyors of the Three Ring Binder network broke ground on their middle mile network in October.
  • Forget 40, I want 100 Gbps: While it's clear that a growing number of service providers want to leapfrog 40 Gbps and go to 100 Gbps, 2010 continued to be a year of trial and testing. Verizon, however, was perhaps the most aggressive when it announced that it would deploy 100 Gbps router-to-router technology on its Paris to Frankfurt network route. Other carriers such as AT&T and Telia Sonera (Stockholm: TLSN.ST) continued to test the 100 Gbps waters. In May, Telia Sonera began testing single wavelength, real-time coherent 100 Gbps trial in its Sweden-based network. As carriers continue to conduct dress rehearsals of their 100 Gbps network, it's likely we'll see more live 100 Gbps deployments take place on strategic routes in 2011.

Well, there you have it.

While I expect these trends to continue into 2011, today's issue highlights five other new trends we think will be hot this year. Take a look at my thoughts today on cloud services, copper technology, Verizon's FiOS, utilities/telcos and CLECs.--Sean

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