Is your service provider a carrier?

* Carrier 3.0

Not so many years ago, there was essentially no difference between a WAN "carrier" and a WAN "service provider." In fact, the terms were often used interchangeably. Of course, we've had years of bandwidth wholesaling. All the way back to the days of T-1/E-1 networks, we were advising customers to make sure that backup or redundant circuits from two "carriers," such as MCI and AT&T, were truly on different facilities so that if a fiber cut occurred, the backup facility would function as a backup. Further, there was a strong argument that the service provider should be the carrier so that if a problem occurred, the purchaser would - at least allegedly - have a more direct impact on the company that was experiencing the problem.

Over the past 10 to 15 years, though, the difference between a carrier – which we will define as a company that provides transport facilities between two points – and a service provider – which we will define as a company that offers some form of telecommunications services – has become increasingly divergent. In fact, one could argue that it doesn’t even matter now whether your “service provider” is a “carrier” or not.

This emerging model of separating the service provider from the infrastructure provider is highlighted in a paper from Alcatel-Lucent, “The Coming Carrier Network Infrastructure: A Very Different Landscape.” The subtitle of the paper is, most aptly, “New Partnerships, New Business Models for Tomorrow’s Telcos.”

In the paper, Alcatel-Lucent stresses that service providers are rethinking their current business models and are increasingly looking at the network infrastructure as something that is outside their core business. Instead, they are concentrating more on delivering enhanced services, and the infrastructure by which those services are delivered is becoming less important. In fact, in some cases, this even gives the option of including wireless infrastructure providers as a part of the service mix, augmenting traditional wireline services.

Needless to say, this rather radical departure opens many doors. And, parenthetically, these are doors that were closed for many years due to tight regulation of the telecommunications industry.

We see this as an exciting new business model that will allow for rapid deployment and for significant product differentiation. Let us know your thoughts on this “brave new world” of services and whether you’re ready to make this leap to a new breed of service provider. We’ll share your responses in a future newsletter.

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