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Rural wireless operators say they're in the business because of the Tier 1s' shortcomings, but their main competition is in the cable camp.

Small Telcos Don't Want Your Pity

Dan O'Shea
6/19/2014
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CHICAGO -- Light Reading's Big Telecom Event -- Small telcos have the big telcos to thank for their existence, but the cable TV companies to thank for their competitive spirit.

That's just one of the bits of understanding to come out of a surprisingly wide-ranging Wednesday afternoon panel, "Competitive Strategies for Smaller Telecom Operators."

It's often been often observed that the largest telcos don't put much effort into effectively serving small market consumers and small businesses, but Andre Cooks, director of business development at Comlink, put it succinctly: "All of us are in business because of the shortcomings of the RBOCs," he said. "If they were doing their jobs, we wouldn't be here."

At the same time, Cooks and his colleagues -- Darren Peterson, vice president of product marketing at Enventis, and Maura Mahoney, senior director of marketing and product management at FirstLight Fiber -- agreed that it is not the big telcos that they compete with most directly. Instead, it's the cable companies with their aggressive pricing to SMBs and local-level network reach, that are their main targets, a point worth noting because the cable guys for the most part feel they're doing battle with the big telcos.

"Cable sells cheap bandwidth, but we sell performance, reliability, latency, and the idea of being flexible to customer needs through locally based service and support," FirstLight's Mahoney said.

"Being embedded and invested in local communities matters," added Peterson.

While acting as the small, friendly neighborhood telco is something worth leveraging, being a small telco also comes with obvious challenges to overcome.

"We have a saying that no one ever got fired for choosing AT&T, but if they choose us, they are putting their job at risk if we don't deliver,” Cooks said. Mahoney also noted that size can be a disadvantage when wooing multinational business customers; it puts added pressure on small telcos to make good on their sales pitches.

The conversation then strayed far from the topic of competitive positioning to virtualization. Does it matter at all at the independent telco level?

ComLink's Cooks said it does and that his company is currently developing an on-demand services model. Yet, while the issue of virtualization is all-consuming of late at the large carrier level, Peterson noted that small telcos can come into the virtualization conversation later than most carriers, and still get what they need to out of it.

"We don't need to think as far ahead as some of the big telcos on virtualization because we can actually learn from what they're talking about, and then we're still fast enough that we roll it out before they do."

— Dan O'Shea, Managing Editor, Light Reading

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SachinEE
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SachinEE,
User Rank: Light Sabre
6/24/2014 | 10:23:42 AM
Re-small Telcos owe cable TV companies
It is very true that the small Telcos should thank the big Telcos for their existence but they should even thank the cable TV companies more for their competitive spirit. I agree with the fact that the small Telcos do not directly compete with the big Telcos. It is also very true that despite the fact that cable sells cheap bandwidth, they also sell performance, reliability and flexibility. The small Telcos are normally faced with very many challenges, but the good thing is that they always find a way of overcoming them.
Ariella
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Ariella,
User Rank: Light Sabre
6/19/2014 | 12:52:18 PM
small
That's a model for any smaller company. Don't focus on what you can't do but what you can as here: "we sell performance, reliability, latency, and the idea of being flexible to customer needs through locally based service and support,""
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