MARKETWATCH
Twickenham Stadium April 1st & 2nd, 2009
www.comms-dealer.com
EXIT MATTERS...
BROADBAND
update:
SDSL seems to be making
By Nigel Cook, CEO of Evolution Capital
something of a comeback but
Returning home from an extended
how does BT Wholesale’s SDSL
Christmas break taught me a lesson about
the disastrous consequences of false differ from some of the new
economy. As my wife pointed out, had
variants? Andrew Dickinson,
I not turned the heating off, we would
not have found ourselves ankle deep in Sales and Marketing Director at
water. Wholesale bank funding remains
Griffin Internet investigates.
as frozen as my plumbing in December
and we’ve seen a flurry of redundancies,
Andrew Dickinson
but the factors affecting the likely volume
of transactions in the owner managed
telecoms sector will repay a closer look.
I
have received a number of questions contract whereas most ISPs sell ADSL on
following last month’s article on SDSL, a one-month minimum commitment. Also
Annex M, Leased Line replacement and BTW’s SDSL cannot be migrated (ie, moved
Prices for sellers appear to be holding particularly SDSL. Some of the new low- between ISPs). If you want to move the
firm. There’s a better balance between contention, Annex M services offered by LLU contract between suppliers (even after the
buyers and sellers and while buyers were operators are being referred to as SDSL, they minimum 12 month term has expired) you
restricted recently in their pursuit of quality do offer a symmetrical (ie, same upstream need to cease the original service and start
opportunities, we are now finding more speed as downstream speed) service, again. Speed re-grades are also much more
shareholders ready to discuss the benefits however there are some important differences costly and time consuming on true SDSL
of an exit. Banks still have an appetite for between these products and BTW’s SDSL. products than their ADSL based counterparts.
funding robust propositions and with interest
rates at a 300 year low, debt funding has LLU-based Annex M symmetrical products are Costs and prices are very different. The
significant attractions. News coming through not SDSL. SDSL (or Symmetric Digital Subscriber installation price of BTW’s SDSL is £315
as I write indicates that government backed Line) is not BTW nomenclature but an industry whereas ADSL is usually under £50. Similarly
loan guarantees should stimulate the standard created by the ETSI (European the price of renting an SDSL tail from BTW
availability of credit for deals. Private investors Telecommunications Standards Institute). It is more than 10 times that of an ADSL
are taking the view that investing in private describes a symmetrical broadband product tail. Bandwidth charges are the same
companies may be the principle route that generally operates at speeds up to 2Mbit/s between BTW’s SDSL and ADSL products.
to capital growth. Sterling’s fall may soon in the field. SDSL takes up the entire frequency
prompt foreign investors to look for bargains and therefore needs a dedicated telephone Symmetrical broadband has become
in privately owned companies’ boardrooms line that cannot be simultaneously used for more popular recently because a lot of
as well as in our troubled High Streets. normal phone calls (unlike ADSL). It also requires businesses have been looking at their
a specialist router that is generally much more costs and wondering if they can replace
In these challenging times, the case for expensive than an ADSL router. The newer breed some of their expensive leased lines with
consolidation to achieve improved profits, of symmetrical products are based on ADSL. broadband. What has put them off until now
and so maximise shareholder value, has has been the cost and limited availability
never been stronger. While fire sales may Contention ratios are different. BTW only offers of BTW’s SDSL and the fact that with ADSL
grab the headlines, quality opportunities are one contention ratio on SDSL of 10:1. There upstream speeds have been limited.
now abundant. Funding is available for those are no throughput guarantees on upstream
bold enough to seek it and if government or downstream but because BTW’s capacity The other driver is voice. Of course telephone
intervention thaws credit markets we could in the 700-plus exchanges that offer SDSL conversations are both-way and therefore
be in for a roller coaster. Of course, many is generally under used most customers will need an equal amount of bandwidth in
deals will fall but bold and creative leaders experience speeds of at least 1Mbit/s in each direction. They also need predictable
will flourish to ensure that our sector emerges both directions. Some LLU providers offer 1:1 quality and so guaranteed, un-contended
fitter and stronger. Identify the opportunities and 5:1 true SDSL at a premium, but now bandwidth is exactly what the hosted PBX
– it’s the best way to overcome current many of the new ADSL based symmetrical and SIP guys have been waiting for.
difficulties. It may seem that some of the rules products can guarantee contention ratios
have changed but a company’s purpose and in some cases you can buy them with So with guaranteed bandwidth and upstream
remains unaltered – maximising the growth of dedicated bandwidth if your customer does performance as good as – or better – than
shareholder value. Finding opportunities may not want to share the line with anybody else. SDSL along with much keener pricing, you
cost some time and money. Not bothering might want to start thinking about which of your
may leave you more than ankle deep.
�
Contract terms are usually different. All SDSL customers would benefit from one of the new
from BTW comes with a minimum 12 month Annex M LLU services.
�
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42 COMMS DEALER FEBRUARY 2009 www.comms-dealer.com
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