Level 3 Communications (NYSE:LVLT, news, filings) has decided to take on the French enterprise market, expanding the scope of its European operations at a time when the macroeconomic environment is constraining many of the incumbent operators. The global network operator says expanding its investment in the country, adding sales and support personnel, enhancing its product portfolio, and expanding its network reach. That last one means more PoPs in the Paris metro area plus additional core network capabilities in Lille, Lyon, and Toulouse.
This parallels Level 3's previous move into the German enterprise market, which was announced in October of lastyear. Since the Global Crossing deal, Level 3 has been talking up its ability to start going after the European enterprise market. Their presence has until lately has been largely a wholesale one, but the asset base is deep enough now and the market sufficiently mature that it is economical to invest in the enterprise space.
The UK, where Global Crossing had a start going already, was first, while Germany had been Level 3's main stronghold on the continent itself. Their move into France will probably be followed with one in the Benelux region, which holds their remaining substantial bastion of metro fiber. I'll be curious to see if they then start working more to build metro assets further afield.
Level 3's expansionary footing in Europe comes at a time when many think a wave of M&A may be ready to sweep across the region. Most in the media are looking at the mobile space, but I think we may see some fiber change hands as well. Some already had of course, with euNetworks, Colt, Interoute and Level 3 itself making moves of different sorts last year.
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