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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.