Broadband ISP

I just read this local article from a Phoenix computer magazine. Here it is

On Wednesday, Associate Editor Elizabeth Millard and I sat
down for lunch with Bill MacLeslie, the head of the largest
local ISP, Visi.com. His company is growing despite losing a
lot of customers who went out of business in the last couple
of years. Why? Because he pays attention to his customers'
needs and he doesn't promise more than he can deliver. The
behavior of his company is in stark contrast to the local
Baby Bell--Qwest--which tried to sell DSL and other services
to customers knowing it wasn't feasible for them.

We talked about my disastrous experience with Qwest, which
stemmed from the fact that I was just too far from the
nearest central office (CO) to get anything like a reliable
DSL signal that didn't interfere with my voice service.
(Other factors in the voice network may have had an effect,
but I never found out because Qwest wouldn't send a
technician out.) Qwest had to know that I wasn't eligible.
For whatever reason--overaggressive sales reps, management
decisions, etc.--it sold me the service anyway. MacLeslie
said he rarely gets connectivity issues with his customers
because he refuses to offer DSL to customers greater than
15,000 feet from a Qwest central office. This is just one
way the small local company better serves the needs of its
clients than the huge regional monopoly. So he retains the
customers that survive and grows primarily trough word of
mouth.

We didn't ask him about the impending FCC ruling, which was
supposed to free Baby Bells on certain competitive laws.
The details at the time were too sketchy and the ruling too
much in doubt to get a solid conversation going. But rumors
ahead of time made it seem like it would not go well for the
likes of Visi.com. Rather than speculate, I waited until the
ruling to call him back and get a reaction. Because the
ruling came out shortly before I wrote this (Friday), I
called to get his reaction. Still the ruling was too vague
for him to get a solid read on how it will affect his
business. He is worried that it would now be legal for Qwest
to phase out his company from its present
arrangement--offering the applications and service
agreements to customers while Qwest offers the lines. But
he's not so sure it would phase out Visi given the
profitable nature of the relationship. He's more concerned
about smaller ISPs falling away from Baby Bells if the Bells
are interested in their customers or find the relationship
too cumbersome.

He did say one thing that perked my ears up: "The FCC is
clearly in the Baby Bells' corner."

If that's the case, the Bells are acting like the spoiled
children that didn't get ice cream with their birthday cake.
Apparently, they expected to be able to raise prices for
Competitive Local Exchange Carriers (CLECs) and local ISPs
(which are one and the same entity in many cases) tomorrow
if they wanted to. Instead, competitively priced line
sharing will be phased out over three years, giving CLECs
and local ISPs opportunities to either invest in their own
solutions or develop alternative business relationships.
Most important, it will keep the millions of users who rely
on the services of the little guys connected and engaged.

As for Visi, it will develop its own solutions and seek
alternative partnerships regardless of the effects of the
ruling. For example, it's looking into erecting fixed
wireless towers at the edges of the range of DSL. If you
draw a map of any large metropolitan area, you'll find that
most COs are more than 30,000 feet apart. That leaves whole
swaths of populated areas without reliable DSL service. Visi
is looking to fill those gaps by erecting towers to serve
customers with 802.11 wireless service. MacLeslie will make
these investments because he's had to turn away hundreds of
prospective customers who fall through the DSL cracks.

One company sure to be affected is Covad, which leases lines
at a fraction of the cost to individuals and charges ISPs,
such as Earthlink, an upcharge on those lines. If a Bell
offers Covad a line for $10 per month, it charges Earthlink
$30 per month, which in turn charges the customer $50. If
Covad must pay $30 for that line, Earthlink will not be able
to resell the service at anything approaching a profit
(after customer service and other costs). The end result
will be less DSL for customers, especially in those areas
where the Baby Bell is either incapable or unwilling to
invest. As many more customers will most likely be without
affordable DSL service as a result of this ruling,
MacLeslie's investments in 802.11 will inevitably grow. And
companies like his that make the best of this ruling while
keeping the customer in the center of their focus will
thrive regardless of the FCC's Baby Bell favoritism.

For more information:

The FCC's ruling:
http://www.computeruser.com/newsletter/8108.html

The Baby Bells' reaction:
http://www.computeruser.com/newsletter/8109.html

-- James Mathewson is editor of ComputerUser magazine and
ComputerUser.com.