Bell Atlantic and Metromedia Fiber Network Inc. (MFN--New York City) opened a new door to long-distance services competition with their agreement to enable MFN to implement dark-fiber connectivity within Bell Atlantic's central offices. A trial is underway that, if successful, will lead to a tariff and general offering to other fiber providers.
The initial agreement for a trial began more than one year ago when MFN requested negotiations with Bell Atlantic for an interconnection agreement under the Telecommunications Act. MFN, a fiber provider for other carriers, primarily competitive local exchange carriers (CLECs), presented a number of very unique requirements to Bell Atlantic that warranted substantial negotiations before this unprecedented agreement was reached.
"We felt some of the things they [MFN] were looking for were not necessarily germane to a CLEC marketplace, but rather more appropriate to a CAP [competitive access provider] marketplace or a more general market," says Jennifer Van Scoter, director of interconnection services, negotiations, and policy for Bell Atlantic. "So as we tried to work through the negotiations, we felt a creative solution was this service that we developed specifically to meet some of their needs, but also some of what we had been hearing in the marketplace from other fiber providers."
Under the agreement, and upon successful trial completion, MFN plans to install hundreds of dark fibers in Bell Atlantic's central offices (COs) without a requirement to locate the lines in a separate area known as a collocation cage. Dark fibers are inactive fiber-optic strands that, when put into service, can provide high bandwidth capacity for the transmission of data, video, voice, and multimedia communications. MFN can now pull a single, high-capacity cable containing many fibers to a universally accessible distribution point within Bell Atlantic's portion of a central office and sell the lines directly to CLECs and other carrier customers.
At press time, MFN was under a Security & Exchange Commission (SEC) "quiet period" required during procedures to acquire AboveNet Communications Inc. and was unable to comment on the agreement with Bell Atlantic. But according to a press release issued by MFN, once the trials are successfully completed, the company plans to offer connection in more than 100 Bell Atlantic central offices in New York, Philadelphia, Washington, DC, and Boston, as well as in key COs and tandem switching centers within the Boston-to-Washington, DC, corridor. MFN also plans to expand fiber-optic infrastructure availability in other central offices in Bell Atlantic's region.
The value of such an agreement to MFN is in offering competitive alternative transport terminal (CATT) service, which equates to having distribution points within Bell Atlantic's central offices. Before CATT service, MFN was servicing its customers, mostly CLECs collocated in the COs, by pulling in a fiber to each individual collocation cage. For five customers, that meant pulling five fibers into the CO. With the new service, a single multifiber cable can be pulled in and terminated at the distribution point. From there, CLECs can purchase access to the fiber through collocation, going from their collocation cage to the distribution point. MFN reduces costs by not having to pull additional fiber cables in, while servicing its customers much more quickly with in-place fiber.
Bell Atlantic also reaps a major benefit in this deal. It provides inter-local access and transport area (interLATA) relief from the Federal Communications Commission. For Bell Atlantic, this agreement demonstrates its network is open to competition and that competitors have compelling alternatives to the company's service in its central offices. This gain of regulatory relief for interLATA services is critical to Bell Atlantic, which has made a concerted effort over the past six to 12 months to demonstrate its openness to competition.
Industry analysts, such as Current Analysis Inc. in Sterling, VA, are concerned that there may be some "smoke and mirrors" to this announcement as it is only a trial for the time being.
"Both Bell Atlantic and Metromedia stand to benefit enormously from this agreement, provided the trial is successful and implemented in a timely manner," says Jilani Zeribi, senior analyst for network services at Current Analysis. "However, access to COs has been one of the most contentious points for relations between RBOCs [regional Bell operating companies] and CLECs, and we doubt that Bell Atlantic will make full-scale implementation as simple and easy as it appears in the announcement."
Bell Atlantic is the first to acknowledge that this agreement is "purely for a trial." It is being tested within five COs and, although MFN plans to eventually serve many more COs, it won't happen before the service is generally available to other fiber providers.
"I don't really view this deal as a major departure from Bell Atlantic's past strategy," says Van Scoter. "We have always been very focused since the Telecom Act on getting interLATA relief and have taken many very aggressive steps toward a competitive environment to bring about regulatory relief and competition in the long-distance market. We believe this is just one more step in that direction."
At press time, the trial was on track, according to Van Scoter, and Bell Atlantic anticipated filing a tariff to make the service generally available to anyone immediately following the trial.
"We've overcome every [trial] hurdle thus far," says Van Scoter. "We're very pleased with how the trial has gone and anticipate filing a tariff very soon. I think the win for Metromedia is to better service its customers. The 'golden egg' for us is long-distance competition."