UTELCOS should consider fiberloops to help wholesale their dark fiber

Fiber Optics Weekly Update, May 17, 2002 by Paul A. Demerly

Fiberloops, or www.fiberloops.com, is the moniker for a new interactive Web site being operated by Boston Internet company CDS Business Mapping that has quickly become a popular service for JSPs, carriers and other telecom pros looking for available fiber, optical bandwidth, and even co-location space.

Currently, Fiberloops has relationships with over 125 fiber providers, many of which are traditional carriers in the telecom market. They are looking to establish relationships with UTELCOs in key markets, claiming that they have had over 300 buying opportunities they could not complete due to lack of dark fiber in certain geographic markets.

"If you're trying to build a network these days, you basically have to kick off a huge research project," says Dan Munson, vice president of marketing for Fiberloops. "We're trying to make things much simpler. We're trying to aggregate all the information in one place with an advanced search engine."

As Munson phrases it, CDS and Fiberloops are trying to "revolutionize the wholesale telecom market." End users can conduct a search on the site by local fiber, carrier hotels, long-haul fiber routes or central office space.

Fiberloops tries to enhance its own attractiveness by putting buyers and sellers of fiber together at no cost to the user. The company collects 3 percent of any completed deals brokered through Fiberloops. Munson adds that he believes many deals are in the works but that the sales cycles might run anywhere from six to nine months. CDS currently doesn't charge for fiber listings, but fiber providers must pay a $300 monthly fee for carrier hotel listings, with tiered pricing options available for multiple hotels.

The Fiberloops business model sounds quick and painless, and it is when compared to the closest competitors on the wholesale market--the bandwidth exchanges. Those players usually get involved in the fiber pricing by actually buying and selling fiber. Fiberloops stays out of the pricing, and takes itself out of the negotiations once a match is made through the portal. The philosophy, according to Fiberloops, is about "finding the right fit." Munson says the site isn't in the game to drive down prices.

Up until now, the marketing folks at CDS have been seeking out fiber and colocation clients to fill the database. Munson said the priority now is to begin to drive buyer traffic to the site.

"When you create a market, you have to have buyers and sellers going to the site at the same time, or it's pointless," Munson says. "The real push has been to the companies carrying fiber, but we're not beginning to focus on end users."

That's music to the ears of Fiberloops' clients. For example, Digital Teleport (DTI) is a St. Louis-based service provider currently building out a fiber optic network in the Midwest designed to bring services to businesses in second and third tier markets. In addition to its own footprint, DTI owns about 20,000 additional miles of fiber.

"We plan to use some of it for any eventual expansion of our strategy," says Martin Mueller, DTI's director of sales. "We also felt there was an interesting opportunity to offer wholesale transport services."

In order to get its available fiber in front of potential IXCs and other wholesale carrier customers, DTI signed on with Fiberloops. Mueller says DTI just came online within the last two months and already has received its first customer leads.

The Fiberloops project isn't a completely novel undertaking for CDS. Three years ago, the company launched Telecom Site Source, another interactive site created for wireless companies to locate cell towers. The site's popularity quickly soared and it now holds over 200,000 tower listings from more than 240 companies. In July, Telecom Site Source kicked off its first premium subscription service.

If Fiberloops can translate its success at Telecom Site Source to the wholesale fiber sector, UTELCOs should definitely consider it as a viable market option.