Tue 20 May 2008
A quote from Saturday's Daily Herald seems to indicate that this is the case:
"Broadweave has a CLEC or Competitive Local Exchange Carrier relationship with Qwest, and will therefore not be a service provider on Qwest's network," [Broadweave CEO Steve Christensen] said.
This seems fishy on a few levels. About 85-90% of Veracity's customer base exists outside of iProvo and UTOPIA. This is primarily in selling voice and data services over Qwest's network, the bread and butter of the company's revenues. It doesn't make sense to shed a significant portion of Veracity's customer base as part of this acquisition, yet that seems to be exactly what Broadweave intends to do.
The statement on being a CLEC also doesn't seem to make sense. Veracity has been a CLEC for a very long time using Qwest's network. How is it that Broadweave being a CLEC would preclude it from using Qwest's network? After all, MSTAR, Veracity and XMission have used Qwest's infrastructure while participating on iProvo or UTOPIA.
This also raises a lot of concerns with Veracity's employee base. Their experience is primarily with business clients, yet we're seeing that Broadweave will dump most of those clients in favor of a largely residential mix. It remains to be seen if they can successfully pull off this transition, but I highly doubt it.
May 20th, 2008 at 1:03 pm
The statement is largely nonsensical but he may be referring to the more limited context of CLEC UNE switching migration, where UNE-P has been phased out leaving only UNE-L, including wholesale loops but no platform. Granted it’s a rather limited context, not being able to resell wholesale switching from Qwest, but other than that the statement makes little sense; after all the whole point of being a CLEC is to be a service provider utilizing the incumbents facilities.
May 20th, 2008 at 5:07 pm
Yes, somebody flubbed this quote. Whether it’s Steve or the reporter the statement doesn’t make sense.
May 21st, 2008 at 7:03 am
Jarrod,
I would agree with you that the quote got mixed up. It doesn’t make sense to purchase Veracity and then dump their customers.
May 22nd, 2008 at 4:43 pm
“Broadweave has a CLEC or Competitive Local Exchange Carrier relationship with Qwest, and will therefore not be a service provider on Qwest’s network,” he said. “But it’s an unsettled issue with UTOPIA. We need to get visibility into UTOPIA, troubleshoot and see what’s wrong with the network.”
Without any better enlightenment or elaboration in the article (which in fairness to Broadweave, was probably not the thrust of the article anyway), it seems to me that Steve is saying that Broadweave is a CLEC on the Qwest network in Provo, but that with the iProvo acquisition, they will no longer be competing in that manner, but will rely on their own facilities based competitive model. In that sense, if you want Broadweave’s product, you’ll have to get it on Broadweave’s network (iProvo) and not on Qwest’s network. If I’m correct in that interpretation, then the quote was either not complete enough, or Steve did a poor job of explaining what he meant, which is forgivable for anyone dealing with a reporter.
What concerns me most about the quote is the Utopia reference. What is meant by needing to “get visibility into the Utopia network, troubleshoot and see what’s wrong with the network”? At best, it would mean Broadweave, by acquiring Veracity, will become a provider on the Utopia network and will see how they can best make the network successful. At worst, it will mean that Broadweave will use its Veracity acquisition to make mischief for Utopia and try to make an acquisition run at the network like they did at iProvo. Broadweave has already expressed its bias against open networks, and it will be interesting to see how well they play with others on Utopia.
Let’s keep an eye on it.