[115601] in North American Network Operators' Group
Level 3 (was: "legacy" Wiltel/Looking Glass bandwidth)
daemon@ATHENA.MIT.EDU (Deepak Jain)
Thu Jul 2 14:50:59 2009
From: Deepak Jain <deepak@ai.net>
To: "Eric Nowland, Wyoming.com" <eric.nowland@wyoming.com>, Will Orton
<will@loopfree.net>
Date: Thu, 2 Jul 2009 14:50:17 -0400
In-Reply-To: <4A4CEC91.3070600@wyoming.com>
Cc: "nanog@nanog.org" <nanog@nanog.org>
Errors-To: nanog-bounces+nanog.discuss=bloom-picayune.mit.edu@nanog.org
Without continuing the L3 pile-on, one can easily glean from their public f=
ilings that they have never properly filled out their management depth in a=
cquisition absorption and/or sufficiently empowered those folks. The billio=
ns in revenue lost from acquisitions like Genuity and others have told this=
story more than once.=20
L3 is not alone in this. Worldcomm's failure to integrate acquisitions led =
to a much larger operational cash need than VZ has shown for the same asset=
s (verio, lots of other names here). This is because VZ understands how tra=
ditional businesses acquire others, better, in my opinion.=20
Unfortunately, L3 has shown little interest in making the "real world, toug=
h business" cuts in heads and absorbing the real (internal) pain of acquisi=
tions and seems to have a pretty laissez-faire attitude towards its custome=
rs, even at its senior management levels (Cxx). I think this will be (and h=
as been) the biggest problem for them. Even a possible merger/JV with Sprin=
t may not be sufficient to solve that. Their resolution of billing disputes=
is much more typical of WCOM than VZ.=20
They are a big fish in lots, and lots, of markets. They enjoy being able to=
dictate pricing in them. IMO, however, they don't have the maturity of (sa=
y, AT&T or others) to take that big fish status and leave you still happy w=
ith the service. (colloquially: if [good companies] are going to take advan=
tage, at least they don't make it more painful than necessary).
Operationally, where you have options (because of pricing, locality, etc) i=
t's long-term good to support competitors, diversity in connectivity, etc. =
History has shown time and time again that when an industry consolidates a =
lot of business with a certain vendor, bad things can and do occur.
Deepak Jain
AiNET
