A simple proposal

Competitive service providers risk losing key political battles unless and until they can develop a single, simple message to take to Washington, D.C., Arunas Chesonis, chairman and chief executive officer of Paetec Communications, warned a Comptel audience in Orlando today.

Chesonis, the opening day keynote speaker, encouraged CLECs to hang together--or risk hanging separately--after sharing his company’s secrets to success, which include extraordinary efforts to keep employees happy and working hard.

In an interview after the speech, Chesonis and team make a compelling argument for the dangers to CLECs and their customers of allowing incumbents to successfully sell their message of intermodal competition to politicians and policymakers.

“The Bells have done a good job of selling the notion of intermodal competition,” Chesonis said, referring to the lobbying campaign, which highlights loss of wireline revenues to wireless replacement and cable VoIP services. “But small to mid-sized businesses can’t call up the cable company and get 3 T’s [T-1 lines].”

The CLEC industry needs to develop a simple message that highlights the fact that the SMB community needs competitive service providers, and competitive service providers need access to local loops, he explained. As the incumbent Bells focus attention on their intermodal competitive threats, the natural outcome could well be the elimination of requirements for local service resale, he said. Verizon already received forbearance from some common carrier requirements when the Federal Communications Commission failed to act on its petition within the legal time frame.

Of course, it’s not just telephone companies that are blocking access to local loops. According to Chesonis, Paetec cannot buy service from Optimum Lightpath, the Cablevision CLEC subsidiary that has lit 2000 buildings in the New York Metropolitan area.

And incumbents are looking to go farther, selling services to larger companies not based on special access tariffs but on customized deals that enable them to undercut CLECs attempting to compete by reselling special access, said E.J. Butler, chief operating officer and cofounder of Paetec.

All of which adds to the argument that CLECs must band together and take a simple statement to those who influence policy, Chesonis said. It’s certainly a message that Comptel CEO Earl Comstock welcomes, as he made clear on Monday.