UNMASKING THE FIBER BARONS : They're building a fiber empire to carry voice and data around the world. Who are the fiber barons and what have they wrought thus far?(Company Business and Marketing)

About this story

In the fall of 1998, AN profiled a variety of competitive carriers, large and small, that were deploying fiber in the U.S. (see "Sculpting the light," August 15, 1998; "Regional CLECs plant fiber stakes in the ground," Sept. 1, 1998; and "The fiber webmasters," Dec. 1, 1998). Much has changed for these companies. Some of them have quietly disappeared, while new ones have come onto the radar screen.

The good news is that most of these companies are thriving. Many have more than doubled their revenues between 1997 and 1998.

At press time, the majority of the companies profiled in this article were awaiting 1999 revenue reports. However, most were confident that their reports would show an even bigger profit between 1998 and 1999. (Readers can go to www.americasnetwork.com to see those 1999 revenues.)

In our April 1 issue, we'll profile Time Warner Telecom, CapRock Communications Corp., e.spire Communications Inc., Intermedia Communications Inc., GST Telecommunications Inc., Electric Lightwave Inc. and Nextlink Communications Inc.

If the 1900s was the Century of Copper for the telephone network, it seems clear that the next century, or at least the first half of it, will be known as the Century of Fiber Optics. This is the time of the fiber barons, who are building a high-speed network across the globe to carry ever-expanding, converged voice and data services.

Spending in the fiber optics market more than tripled from 1990 to 1999 - from a "mere" $4.1 billion to $14.6 billion - according to the 2000 MultiMedia Telecommunications Market Review and Forecast, recently published by the Telecommunications Industry Association (TIA) and MultiMedia Telecommunications Association (MMTA). The world's seemingly insatiable demand for broadband services, as well as bandwidth, will only boost those numbers as we splice our way in to the next millennium. The report says that spending on fiber optics gear is expected to increase from $12.2 billion in 1999 to $28 billion in 2003.

The TIA/MMTA report also notes that interexchange carriers (IXCs) increased their fiber deployment to 4.5 million miles in 1999, which is 15 times the amount of fiber they deployed in 1995. Factors driving growth include demand for Internet access, IXC entry into local markets and new carriers that are building high-capacity networks.

Fiber deployment has also gotten a boost from convergence. Cable companies installed nearly 2.6 million fiber miles last year, which accounted for 22% of the total amount of fiber deployed last year, the report says.

Long distance carriers have deployed fiber between urban areas when the distance between cities has justified the expense. Local exchange carriers (LECs), which have primarily used fiber to connect their interoffice facilities, have been laying the groundwork to increase fiber's penetration in the residential access area. LECs installed 322,000 miles of fiber in 1999. TIA/MMTA expects a whopping 2.2 million miles to be deployed in the residential area in 2003.

Last but not least, the fast-growing competitive access providers (CAPs, a.k.a. nonincumbents) are deploying a fair share of fiber optic cable as well. Deploying 1.2 million fiber miles in 1998, the CAPs bumped that number up to 3 million fiber miles in 1999.

The fiber barons

To produce this story, AN's Senior Technology Editor, Annie Lindstrom, talked with senior executives at 15 carriers. The two-part fiber barons series describes how these carriers are positioning and differentiating themselves in an increasingly competitive marketplace.

This segment, Part I, covers the following companies: Metromedia Fiber Network Inc., Williams Communications, NorthEast Optic Network Inc., Qwest Communications International Inc., Global Crossing Ltd., Teleglobe Communications Corp., Level 3 …