Clec Telephone Network

Telephone Network Assignment

CIS 3320

Summer 2005 - MW

Prof. Sergo

By: Vince Lin

Part I:

Dear potential investors,

As some of you may know, "The Telecommunications Act of 1996" is responsible for competitive local exchange carriers today, otherwise known as CLECs. What makes a "CLEC" so special? First of all, CLECs were created to compete with incumbent local exchange carriers (ILEC), such as ALLNET, and Regional Bell Operating Companies. The reason was to halt the current monopolization held by regional Bell companies and to free up competition. An advantage a CLEC has is the availability to use the infrastructures of competing ILECs. One way CLECs utilize this advantage is through the utilization of unbundled network elements (UNE), which is any "facility or equipment used in the provision of a telecommunications service including features, functions, and capabilities that are provided by means of such facility or equipment." The local loop is a crucial UNE that connects ILECs to ILEC customers. However, the local loop also connects CLEC switches to ILEC switches, and therefore, gives CLECs access to the very same ILEC customers. Not only does a CLEC benefit from the use of ILEC switches, but it is also law for ILECs to offer discounted rates on any telecommunications service the ILEC retails. A CLEC can then resale these discounted services and profit from both the ILEC services and infrastructures. As you can see, this is the perfect opportunity to venture into the telecommunications industry by forming a CLEC.

After the "Telecommunications Act of 1996" was passed, many CLECs began to pop-up all over the country. In order for a CLEC to be competitive and successful in today's telecommunications market, there must include competitive service offerings to differentiate our CLEC from the hundreds already in existence. Since the market is already saturated with CLECs offering only local and long distance phone services, our CLEC will also provide digital subscriber line (DSL) service to enter the market with a competitive edge. Data transmission is the route a CLEC would have to take today in order to maximize growth and profits, since there is minimal growth with voice services. The local, long distance, and DSL services will be offered in a bundled package in hopes of meeting residential customer needs. By offering our services in a bundled package, our CLEC will be able to offer multiple services through an integrated circuit, which will save you (the investor) money and offer the customer an affordable high-speed internet connection along with local and long distance at an attractive price point.

The specific type of DSL offered would be asymmetric digital subscriber line (ADSL), which is the most common DSL service offered in North America. ADSL typically supports data rates of 1.5Mbps to 9Mbps when downloading data and 16Kbps to 640Kbps when uploading data. These transfer speeds are ideal for the typical internet surfing household where our services will be marketed towards. The great thing about DSL is the ability to utilize already existing copper TP telephone lines! Offering this service will attract many customers