MegaPath Makes Big Bet on Ethernet-over-Copper
MegaPath Inc. today placed a major bet on Ethernet-over-copper (EoC) technology, promising to upgrade its network in 50 top markets over the next two years, using Adtran Inc. (Nasdaq: ADTN) gear. (See MegaPath Announces Major EoC Expansion.)
The choice of EoC wasn't that tough for MegaPath CEO Craig Young, who has built out two fiber-optic networks in his career in telecom, including the Brooks Fiber net. On the one hand, he could spend billions on a fiber overbuild; on the other he could use existing copper lines and reach 70 percent of the businesses MegaPath serves with 20Mbit/s connections in two years.
"Most customers, in my experience, the main thing they care about is speed, reliability and security more so than what the technology is," Young says. "We look at copper being here for the next 50 years, easy. It is going to outlive any of us, so we felt that investing in EoC would be the fastest way to market."
For MegaPath's three core markets -- SMBs, distributed locations of larger enterprises such as retail, hospitality and restaurants, and wholesale services -- delivering Ethernet service at between 2 Mbit/s and 20 Mbit/s that comes with Quality of Service guarantees and built-in security beats most of the competition, Young claims.
MegaPath doesn't yet know what percentage of customers will be able to get service at the very top range that its EoC gear can deliver, which is 90 Mbit/s. But it will be able to offer the lowest range of 2 Mbit/s from 1,900 central offices to meet the needs of the smallest businesses.
Why this matters
By most accounts, fiber-optic cable reaches only about 20 percent of U.S. businesses, so by making a long-term copper play MegaPath is aiming squarely at the companies that won't have access to fiber-based services any time soon. It's also betting, however, that most of those companies won't want more than 20 Mbit/s anytime soon either.
For more on MegaPath, see:
- MegaPath Launches Rocket Science
- MegaPath Taps Sales VP
- MegaPath Chases Managed Security
- MegaPath Expands Ethernet Portfolio
- MegaPath Still on Growth Path
- M2M Pits Carriers Against MVNOs