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Any doubt that the demarcation point sitting on the side of most residential customers' homes is anything more than an arbitrary line should be wiped away with Vonage's announcement that it has struck up partnerships with two vendors and one retail giant.

The deals Vonage has consummated with Linksys, Netgear and Staples are another baby step forward in the long-term seismic shift occurring in the voice/broadband business. While the two vendor relationships give users another couple of choices for premises equipment, the ability to buy service through Staples stores alters the traditional service delivery route.

It also gives the service provider a deeper relationship with the customer. By placing a device in the home that can act as a router and a phone adapter, the user essentially is opting to obliterate the traditional demarc point--be it ONU, NID or some other variety--that marked the legal and operational separation of service provider and customer.

As an aside, this could put access vendors in a bit of a bind. As suppliers of much of the DSL CPE, they're in the best position to also provide the gateway that combines voice, data and video in the home. But what if a spate of broadband telephony suppliers a la Vonage start gaining real traction in the residential market? Does a vendor risk offending its bread and butter telco customer by signing on as a partner for the upstart competition? And will a telco be in a position to cut off that vendor for such a transgression?

But back to the demarc issue at hand. While traditional ILECs have talked for years about having a relationship with their customers, the new model of purchasing residential voice services via retail changes the game. By opting to move into the home, Vonage and other providers are implicitly offering to support the CPE. And though there is a regulatory barrier to most ILECs simply removing the demarc point, it's something many will have to seriously consider as the competition continues to integrate itself into the home.

E-mail me at vvittore@primediabusiness.com