LightReading had an article yesterday about how Cox is upgrading its national network from leased wavelengths to dark fiber. Comcast did the same thing a short while back, and Cox's move wasn't exactly a secret so there's no big shock value. But it did disturb the ashes of an old argument, specifically whether selling dark fiber IRUs is a smart move for a carrier or not. In this case, the carrier is mostly Level 3 - both for the former leased waves and for the new dark fiber IRUs.
If you sell dark fiber, are you giving away the business? A customer who switches from wavelengths to dark fiber does so because it costs him less, meaning he pays you less. And if it works out well, he could theoretically compete with you for some customers. On the other hand, the same customer's expansion may lead to further sales. Since that customer is physically bound to your locations, you will generally have an advantage in bidding for further business such as colocation, CDN (content delivery), and voice services. As with most things in life, it is a tradeoff involving future potentials one can only guess at.
What I am wondering at though is what the price is for that dark fiber nowadays. After all, in the USA there are really only two large carriers left that are at all likely to sell intercity dark fiber on a national footprint in any quantity these days Level 3 and Qwest. WilTel and Broadwing held large piles that are now in Level 3's hands. Verizon has some new builds but not a national footprint of newer fiber. AT&T has more, but also a partial, and the thought of AT&T or VZ selling cheap fiber to a cable company seems ... unlikely. Sprint's fiber is old, some of it is still the direct-buried stuff - not even in a conduit. XO's fiber is Level 3 fiber, and they only have 18 strands. Global Crossing is 24 strands on the Qwest network. So it is Qwest and Level 3, and I haven't heard of Qwest selling much dark fiber lately. So one would *think* that Level 3 should get a good price for its dark fiber.
And perhaps that is the critical decider in the quandary of whether to sell dark fiber or not: price. If the price is right, the deal gets done. In the case of Cox, hopefully the price was right. What do you think? Should carries who have an abundance of fiber sell dark fiber IRUs or not?
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