DSL Prime: Numbers

Year end numbers reveal that the Bells have 90 percent of the U.S. market. If competitors are locked out of the DSL market, how many will be able to build fiber?

by Dave Burstein DSL Prime [April 2, 2003]

The U.S. numbers, yearend 2002
Thanks to Timm Bechter of Legg Mason

Telcos ILEC 1Q
SBC 2,199,000
Verizon 1,788,000
BellSouth 1,021,000
Qwest 525,000

Total RBOC DSL 5,543,000

Net additions 504,000

Broadwing 76,000
Sprint 151,000
Alltel 70,182
CenturyTel 52,800
Citizens 71,000
TDS 20,900
Alaska 12,590
CT 6,664
Commonwealth 9,705
D&E 5,517
HickoryTech 3,971
Horizon 882
Madison River 17,130
NTELOS 6,121
SureWest 15,650 (does not include FTTH)

Total RLEC DSL 520,464

The total of the smaller carriers is less than the smallest of the Bells, but grew 20.1 percent last quarter.

Covad 381,000

Total 6,596,064 U.S. Yearend 2002

Bechter's yearend 2003 projection is 9,100,000, up 2.5 million. He projects yearend cable modems over 16 million. At that rate, half the U.S. Internet users will switch to broadband around the end of 2004.

The full chart, with three years of data and helpful projections for yearend 2003, is here [.pdf].

Malaysia—600,000 line tender
Siemens and Alcatel have a strong presence in SEA, but everyone is going for this one. Malaysia resisted IMF pressure and was spared the worst of the Asian slump. It has a strong government policy of improving infrastructure as a tool of development.

Mexico wants video triple play
Is Telmex finally moving forward?
The highest estimate I've heard for DSL in Mexico is 70,000 lines, and it may be lower. But Slim of Telmex is the most international of businessmen, who has invested, and mostly lost, hundreds of millions in U.S. high tech ventures. He certainly knows all the pros and cons of DSL from his seat on the board of SBC, although he has conflicts with CEO Whitacre. Intensely political (largest contributor to the IRP, a.k.a. PRI), he presumably held back on DSL as part of his struggle with the new government. Telmex has tendered before, but deployed little until now.

Alcatel is presumed frontrunner, with a seat on the Telmex board. But the Mexicans may want more than Alcatel is ready to deliver in video, although the pending purchase of iMagicTV may help. Alcatel's video is led from Europe, and so far has been exceedingly unadventurous.

Testing is Crucial
TI's Jacobsen and Melsa explain SELT
"The biggest mistake I made designing DSLAMs was leaving out test," a key early engineer tells me. "They cut test out of the budget for our early DSL build to save money and it's costing us a fortune," a telco adds. It's hard to make an exciting news report about testing, so I'm glad to get articles like this one. Single-ended line testing allows you to prequalify a line without sending a technician to the customer premises, and to test an installed DSL line even when the modem can't respond. That's often crucial. How to implement SELT, and the standards required to make it work for all, are under active consideration in the standards committees.

Jacobsen and Melsa do an excellent job of explaining many of the key issues. That level of detail may not be interesting to everyone, but if reliable service to customers is part of your job, I suggest you read their white papers.

Briefs

• The FCC has left Covad and other consumer DSL competitors one sliver of continued possibility: lines which have switched phone carriers away from the bell. So an alliance to offer AT&T and MCI customers DSL over the UNE loop remains possible.

Wall Street

• Westell has tripled in four months, going up 50 percent recently when key client Verizon announced DSL growth. So when Anton Wahlman at Needham picked up coverage, he called the company a hold despite being very optimistic about them.

Copyright 2003 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

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