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Just posted my column from Business 2.0. What I am basically saying is that there are still far too many CLECs cluttering the landscape. Expect their number to shrink by two-thirds at the very least.
The four-year-long telecom downturn has managed to wring out most of the industry’s excesses, but there are still too many players remaining. Anyone can see that the industry needs further restructuring. That’s likely to happen in the next 24 months, and once the dust has settled, there’ll probably be fewer than 10 survivors. Who will they be?
Companies with decent networks, good financials, strong balance sheets, and manageable debt loads, such as Choice One Communications, Pac-West Telecomm, Time Warner Telecom, and US LEC. Among companies that have restructured after bankruptcy, Covad Communications, Focal Communications, and IC Communications have a good chance of surviving as independents, provided they stick to their niches. And who will the losers be? Birch Telecom, McLeodUSA, and XO Communications.