June 11, 2010

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Speakeasy, MegaPath, Covad Merger Grabs Headline Attention

In the 24 hours since MegaPath and Covad announced that Speakeasy would be combining its business to help create the first MSLEC (managed services local exchange carrier), we have been part of a flurry of conversations about what this merger means to the telecom and technology industries. From PhonePlus to WSJ/Barron's blog, Connected Planet to Forbes, reporters, analysts, and bloggers are showing keen interest in our announcement. The attention is appreciated.

Right away Om Malik on GigaOm picked up on our merger news, and noted that by creating a MSLEC, we're "sounding the death knell for independent DSL providers." He continued to note that we're moving toward an "ultraband future" and that sets the capex stakes to lofty levels. Another headline reported that the MegaPath, Covad and Speakeasy merger is creating a super CLEC. And finally in a similar vein, Sean Buckley at Fierce Telecom looked at the larger industry trend perspective and stated, "MegaPath and Covad's merger with Speakeasy illustrates the necessary and ongoing consolidation of the telecom service provider market." We know the market well, and yes, we certainly know it is increasingly aggressive.

I would like to devote a few minutes to the customers of MegaPath, Speakeasy, and Covad, and share with you some perspective on the value and services that the merged companies will bring. Yesterday in an interview with Connected Planet, Bruce Chatterley (who will lead the commercial division of the combined MegaPath, Covad and Speakeasy organization) noted that business customers can expect service innovations, and because we will be a facilities-based last-mile provider, "we can do things between applications and the network that are hard to replicate if you're not the owner." When you combine Speakeasy's small business voice and data services with the MPLS-based core network engineering and distributed enterprise expertise of MegaPath that will run over Covad's nationwide broadband network, enterprises and small business customers will be able to rely on one provider. Service delivery assurance will begin and end with our 'one-stop shop'. I'm excited about these capabilities, and the value it will provide to our expanding customer base. We welcome Speakeasy's 30,000 small business customers of voice and data services to this growing organization. As we're creating the next-generation CLEC, our offerings will include a full suite of IP voice, security, VPN and broadband services that are designed to meet the demands of SMB and enterprise customers. Value, network expertise, scalability, and service delivery assurance are what being an MSLEC is really about.

Customers and partners -- you are at the center of this developing organization. What questions can I answer for you?

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