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More metro for Level 3

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Level 3 is trying its best to transform itself from a pure vanilla long haul carrier to a bandwidth operator with deep metro links. The company has been making acquisitions to go after the metro market opportunities, hoping that those will be enough to compensate for loss of AT&T and Verizon long haul business.

Today the company announced that it has bought metro assets from AT&T in six markets: Detroit, Hartford, Kansas City, Milwaukee, San Francisco and St. Louis. The price of the deal wasn’t disclosed. While we understand Level 3’s motivation to get into the metro services, it is not a slam dunk. It faces tough competition from smaller, more nimble rivals such as Yipes.

Ma Bell was supposed to divest assets in 11 markets as a pre-condition for the the SBC-AT&T merger. Six cities come with access to over 200 buildings and more than 1,600 metro fiber route mile. At present Level 3 has 6,500 on-net buildings and over 25,000 metro fiber route miles, while plans are afoot to add upto 1000 buildings in 2007.

Press Release

5 Responses to “More metro for Level 3”

  1. nopzor

    Ever since they acquired Looking Glass Networks, Level(3) has been an important vendor of ours..

    They’ve certainly had a bunch of integration problems and issues, but they do have a very nice IP network, with a lot of capacity and a lot of eyeballs…

    These latest moves are certainly in line with their spree of metro acquisitions.
    Their financials speak for themselves, but if they can pull it off, and rally up LVLT they are in a very interesting position for sure….

    I wasn’t aware that Yipes actually had significant fiber assets. Didn’t they lease a lot of their fiber from Level(3)?

  2. Mike,

    well you can clearly see that at the end of the day, they are a wholesale bandwidth company and the mind set is going to be wholesale.

    the data center business is part of what they have been doing for a long time, so i am a little surprised.

    will keep you in the loop

  3. As a customer who JUST migrated our entire data center to a Level-3-acquired company in Seattle last week, I can say that so far, service and communication could not be any worse. It’s off-the-charts bad so far. Wish we would have never moved. I’ve heard that the actual Level3 data centers operated by Level3 people are great, but unbeknownst to me, we were placed in one of the newly acquired locations instead. One week after we experienced almost an entire day of downtime, still no answers.