Becoming a CLEC

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I know this questions is not really asterisk related, however I know a lot of people here are in the industry.

I was curious if anyone here could provide insight on how to become a facilities based CLEC.

I did a lot of google-ing and read info on voip-info.org but it’s all the same generic stuff and they tell you how to contact an
agency.

If anyone has some insider knowledge or advice, please shoot me an email.

Currently, we are in the Westchester County and will be renting rack space in 60 Hudson down in NYC.

We are already are an ISP/ITSP but we are a reseller and a paper CLEC.

Thanks,

15 thoughts on - Becoming a CLEC

  • It is my understanding a facilities based CLEC is a FCC designation. There are rules that govern who is considered a CLEC. We are a VoIP based interconnect carrier based on the rules. Even though we offer internet services. We do not own any phone service exchanges.

    If you can operate out side of the CLEC classification you are much farther ahead. The amount of reporting and fees a VoIP based interconnect carrier is subject to is quite a bit less than a CLEC.

    Check out the FCC’s website.

    Thanks

    Bryant Zimmerman (ZK Tech Inc.)

    616-855-1030 Ext. 2003

  • Worst reason to become a CLEC: improved cost structure. Or, to be
    precise, it is a counterfactual reason, because it does not result in
    improved cost structure.

    This idea is driven by an incomplete understanding of what being a
    CLEC entails, or, for the less critically thoughtful, the “free lunch”
    fallacy. There is no free lunch. There is no such thing as an
    easy-peasy regulatory reclassification that gets you the same stuff
    you were paying before, but more cheaply.

    Becoming a CLEC is a totally different business model than the one
    you’re in, and it entails magnitudinally more technological and
    regulatory complexity. It’s really almost a different vertical. You
    should become a CLEC only if you want to become a CLEC, not if you
    want to be an ITSP with a lower cost basis, because you won’t be. It
    is a very capital-intensive, non-trivial endeavour with high barriers
    to entry for a good reason. There will be people out there who will
    tell you that those barriers are low; they are on the bridge of
    failing CLECs, treading water.

  • Agreed. And facilities based CLEC even scarier.
    Regulatory / billing / PUC legals etc ugh

    Sent from my iPhone 4S

  • CLECs are certified on the state level, by state public utility
    regulators, in most states known as the state PUC (“public utilities
    commission”).

    Being creatures of the local loop, interconnection with the ILEC is
    something that takes place separately in every LATA, often on somewhat
    different terms even within the same state.

    Negotiating a viable ICA (interconnection agreement) with the ILEC is
    one of the most important elements of success or failure, and is a
    massive endeavour of both personal scholarship and legal expenditure.
    The details of the agreement – most opt-in agreements are hundreds
    of pages long – are ones by which CLECs live or die, especially if
    they are doing a lot of local access, intra-LATA origination, or UNE
    facilities.

    Yeah, discounts are nice. UNE DS1s in LATA 438 are $44/mo. Many
    people lick their chops at such a prospect.

    What these prices don’t take into account is the up-front and
    recurring cost of:

    – CO backhaul (usually dark fiber of your own, sometimes ILEC fiber).

    – CO colocation – expensive, requires third-party vendors, and plenty
    of insurance.

    – CFA (circuit facilities assignment) – your cross-connects for UNE
    handoff in the CO.

    – EELs for dragging circuits out of COs in which you aren’t colocated;
    you won’t go into all of them, it’s expensive.

    – COs where UNE pricing discipline is suspended because of the ILEC’s
    finding of “sufficient competition”, in favour of special access.

    Amortise the up-front and recurring monthly cost of all those pain
    points and see what your new “discounted” rates are.

  • I’m curious what sort of thing would be considered a “non-facilities
    based” CLEC, since UNE-P was cancelled in 2003.

    There are some non-interconnected CLECs out there that exist for the
    sole purpose of leveraging rights of way and stuff like that, but
    there’s not too many things you can do switchless, muxless, DACS-less
    and not interconnected these days.

  • Wow so I left before the end of resale Verizon UNE then.
    We ran Lucent 5E and Nortel DMS and provided facilities voice and DSL.
    Having a large SONET fibre infrastructure helped too.

    Sent from my iPhone 4S

  • The “Unlimited” service seems pretty “limited” to me. Vonage may even
    have more reach than this.

    j

  • Hahah! Yeah it does doesn’t it? What do we do? How do we stay
    a float, It almost seems like the ILECs will drop their rates to a
    penny once the people in this, and Kamailio lists 😉 actually put a
    dent in their underline.

    Nick

  • Only through new, innovative applications. They will always deliver transport and dialtone cheaper than you.

  • But what is the correct physical setup of a CLEC.

    Do you get rack space at a carrier hotel and equipment in there?

    Do you get rack space at the local ILEC CO?; which is Verizon here.

    What are the types of voice platforms used by CLECs?

    Thanks,

  • Just as a point of reference, the CLEC I have experience with had 2-3
    racks in a colo facility and a handful of circuits coming in from the
    access tandem and SS7 provider. The core switch was a SUMMA4, but I
    forget who made the SS7 hardware (it may have been SUMMA as well).

  • There is no “correct” physical setup. The setups vary as much as
    anything else does, and are shaped mainly by the purpose of the CLEC
    and the range of products it provides.

    CLECs that provide a substantial range of business-class voice and
    data services usually have quite a bit of equipment and either end up
    building out their own telco-grade data center somewhere (which can be
    synergistic for many of them since they are also data center operators
    in general), or renting a cage in a carrier hotel.

    There are CLECs whose equipment can functionally fit into a single
    rack, or even less, but those are the specialised, single-track ones
    that mainly exist to support the back side of some VoIP product. In
    cases where only one or two racks are involved, a carrier hotel is
    indeed a common venue.

    Yes, but _only_ for the purpose of colocating equipment that is
    related to backhaul and CFA, i.e. to providing services out of that CO
    and dragging the last-mile loops to the customer out of the CO and
    onto your private network.

    A CO and the equipment allowed it is a very restrictive and regulated
    environment full of equipment certification criteria and obscure
    rules. It will seem especially restrictive if you’re used to working
    with commodity PC hardware and open-source; virtually nothing of the
    sort is allowed to be colocated in a CO.

    Also, keep in mind that COs generally have 23″ telco racks (not 19″
    data racks) and supply -48V DC, or, at best, 220V AC.

    Space in a busy metro CO is very expensive. You really don’t want to
    think of it as a general-purpose colocation facility. That’s not what
    it’s for.

    The answer to that varies a great deal depending on the services being
    provided. But in general, CLECs use converged softswitches that offer
    them the combination of 1) TDM facilities and Class 4 routing features
    they need, along with (obviously) SS7 support and support for more
    obscure protocols that become very important in CLEC land, such as
    H.248/MEGACO, MGCP, etc. and 2) Class 5 subscriber features and
    applications so they can sell business lines, hosted PBX, etc.

    CLECs generally are looking for all of that in one chassis, with the
    obvious redundancy implications as well. They want something that
    they can connect to the ILEC tandems while simultaneously supporting
    constructs as high-level as voicemail or “find-me-follow-me”.

    Common platforms in the wild:

    – MetaSwitch (Class 4/5)
    – Sonus (rather Class 4 and IP-oriented)
    – Lucent Compact Switch – formerly Telica (quite Class 4)
    – Taqua
    – Excel
    – Tekelec

    Broadsoft and Cisco BTS (not so much anymore) figures every heavily
    into this, but they’re slightly different animals than the rest.

    That’s just the formulaic stuff. The big CLECs have all sorts of
    custom stuff, such as Level3’s famed Lucent TNT Max-based “Viper”
    network and corresponding media gateway control/signaling gateways.