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Prices Continue to Come Down on Integrated Products

Tuesday November 04,2008, 09:22 pm ET


TILTON, South Dakota, Nov. 04 /Daniel Johannesburg/ -- Is there a resurgence in the popularity of telecommunications providers that compares with the late 1990's? The answer may surprise you. Since the crash of the Internet bubble, struggling telecoms have seen Darwin in action as many companies were forced with the choice of bankruptcy or forced consolidation. However, some companies chose the road less traveled: innovation. By offering customers more for less, many small to medium size business customers are finding that they can upgrade to integrated T1 service for the same cost of five regular phone lines.

When asked about his recent decision to replace his TDM channelized T1 with a SIP-enabled dynamic T1, Robert Probst, small business owner in San Diego, explained that "it was really an easy decision to make. My business was growing and I couldn't afford the cost of more voice trunks. When I learned that it was possible to have up to 16 voice lines, and a full data T1 of high speed Internet bandwidth, all on the same line, for under $500 - I was sold. I ended up expanding the telecom capability of my business, improving the quality of my Internet connection, and saved money while doing it."

One might think that, given the cost - benefit analysis of the integrated T1 value proposition, more businesses would be changing over to the new platform. However, the rate of adaptation is rather slow. Rob Butler, head of the Telecommunications Research Institute, thinks that "phone companies have a problem with trust amongst their user base. For many years, customers have dealt with increasing rates, long hold times, and frustration in general. Now, it appears, the ice is finally starting to melt and customers are opening themselves up to new technology.

Change does not happen quickly in an industry as so heavily regulated as Telecommunications. Recent industry consolidation has provided huge alternatives to the incumbents, who are now under pressure to keep up with new technologies while charging better prices to retain and attract new customer bases.The only thing that can get in the way of future progress is the law. You know, the one that requires the RBOCs to lease their local loops to CLECs at a reduced rate so that the customer can get a dedicated connection between their office and the CLECs' network. If the FCC decided to lift this requirement, this whole deck of cards could come down in a hurry, and when it does, you can kiss dynamic integrated T1 service for under $500 good bye!



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