RECENT MOVES GIVE CLECS AIR ASSAULT

The fortunes of the competitive service provider industry are increasingly intertwined with those of the wireless industry — and vice versa. Not only have backhaul services for wireless service providers become a major source of income for many competitive carriers, but the prospect of broadband wireless access poses more new opportunities for services and revenues that aren't dependent on access to incumbent facilities.

The broadband wireless options for competitive service providers are rapidly growing, as last week's Broadband Wireless Pavilion at the CompTel Fall Conference in Orlando made clear. The multiple technology vendors were exhibiting systems available for licensed and unlicensed spectrum, as well as rooftop and in-building technology.

Progress Telecom used the show to announce its wholesale wireless last-mile services for competitive providers in the southeast and mid-Atlantic states, where the company operates a fiber-optic backbone. Initially, the services, based on Motorola's Canopy wireless mesh technology, are being made available in two Florida metro areas — Orlando now and Tampa Bay/St. Petersburg in the fourth quarter of this year — but from there, Progress will build out wireless access where its customers demand, said Elizabeth Sheridan Vanneste, senior vice president of sales and marketing for Progress Telecom.

“This saves everybody from having to use the LEC,” she said. “The whole idea is to get the traffic back to our fiber footprint, and this gives us the flexibility to do that, as well as another way to provide access.”

Advantages of the wireless system include faster provisioning intervals and a single point of contact for the end-to-end service, added John Bella, manager of marketing and sales support. Progress can control the service and its costs.

XO Communications doesn't have to look elsewhere for wireless — the company owns 90% of the local multipoint distribution service spectrum, acquired when it intended to use wireless access for its own CLEC operations. The company is again looking at wireless for new revenues, said CEO Carl Grivner, and exploring multiple options.

“We have signed a major carrier to provide wireless backhaul,” he said in an interview at CompTel. “And we are testing technology for WiMAX. Over the last two years, the capability and power of the electronics has definitely improved, and the prices have come down. The prices on base stations are now $1000 to $2000, whereas when we first did this [in 2000-2001], they were $30,000 to $40,000. They have come down because of all the deployments in Europe and Asia.”

The current wireless access systems provide “about four-9s reliability,” he added, which is close to voice grade and may satisfy many customers. “The issue for us in the last mile is roof rights,” he said. “That's why WiMAX comes into play for us.”

XO is currently testing WiMAX technology from two vendors for future deployment.

“This technology has been moving fast the last three to five years,” Grivner said. “And it has the ability to give us freedom from the ILEC. It's so cheap and easy to deploy — it's a win-win situation for us and our customers.”

Another challenge, however, is to overcome the negative impressions left on enterprise customers by wireless CLEC pioneers such as WinStar and Teligent, according to Grivner and John Krzywicki, vice president of marketing and strategy for GigaBeam, which is providing commercial point-to-point links in the 71 GHz to 76 GHz and 81 GHz to 86 GHz radio spectrum bands, known as the E band, on a national basis. Both of those companies tried to use last-mile access as the basis for a competitive service business plan and failed.

“The demand has changed from that time, and the technology is very different,” Krzywicki said. GigaBeam announced its first CLEC customer, Indiana FiberWorks, at CompTel, and is trumpeting its technology for its ease of deployment and very cheap licenses. A blanket national license is $700, and circuit licenses are $300. In addition, the radios GigaBeam sells don't require roof rights because the signal can penetrate 80% of commercial glass.

“We are targeting all carriers, all large enterprises and all government entities,” Krzywicki said. “There's gobs of spectrum, and it's licensed and cheap.”

Sprint is also looking at wireless wholesale technology, although it hasn't yet made a public announcement, said Christopher Mullen, group manger of wholesale marketing for Sprint Business Solutions. More than likely, the work it does with the CLECs will be more like what it has done with mobile virtual network operators, where adding content or creating business solutions is part of the package, he added.

“It has to involve something more than just reselling our wireless service,” Mullen said.