The Early UMC – Why did it work?

So, I wrote a bit of a history lesson about the UMC-1000 (hereafter known as the UMC). The first movers for the product were the smaller Independent Operating Companies (IOCs). The point of this blog is to talk about why this worked. This will lead to why the product failed for years in the RBOCs and then to why it finally won there. This will be part of a series on why the UMC won and lost in different arenas. I hope that you find this helpful to find out how this worked and how AFC reacted around it.

I recall Kevin McClain telling me that the “product sold itself” in the smaller carriers. For IOCs that were not already AFC customers about all he had to do is show up to win. There were lots of reasons for this. I want to focus on one very major product feature that made it popular with the small carriers: “Any Slot, Any Service”. By strict truth, this was not accurate. Each 120 line shelf had 26 slots and only 22 of these were “Universal” slots. But those 22 slots were truly universal until near the end. On top of that there was only one kind of shelf in the system so Any, Any, Any was true across the board.

Before I move on, I need to describe the competitive systems. They were almostly exclusively somewhat fixed in their capabilities. By that they had the notion of a “Commons Shelf” and a “Line Card Shelf”. So to put together a system one needed a minimum of 2 shelves. With the UMC, this could be done with one. On top of that, there was the 48 line shelf that was really half of a shelf. One other piece of information that you need to know. We did a study of the number cabinets shipped by type and found that well over half were 48 and 120 line systems. This means that they were single shelf. You can see right away that in these small systems that the UMC had a huge cost advantage over its competitors.

To jump ahead a bit to the RBOCs, the focus there is on larger cabinets. This is because the bulk of the population in these companies is Urban and Suburban. So, this ability to deliver a system that was very cost effective at low population density was not as important. I will come back to this in the next article about the RBOC failure.

So, there was something else about “Any Slot, Any Service” that was more like a promise. The UMC began to absorb other products that provided wireline access. This included things like D4 Channel Banks or HDSL products or Pairgain products. The customers began to realize that if a new type of capability was required that AFC would make a blade that would allow customers to deploy this out of the UMC. For these low density deployments, these more specialized capabilities were one or two at a time. To deploy them out of a UMC was more expensive per port than what it would be out of a dedicated product. But at low take rates, the absolute cost to deploy another specialize box did not make economic sense.

What I am hoping you are beginning to see is a pattern. Compared to dedicated or high density products built for large carriers, the UMC was simply much cheaper than the alternatives for the small carriers.

One last “Any Slot, Any Service” item. This also meant that cards that were normally supposed to be placed in Outside Plant Cabinets could be placed in Central Offices and vice versa. This might not seem like a big deal but what it allowed is that high cost services could be brought back to a central location and still offered over a wide area. The classic case for this was ISDN. Carriers had to pay huge upgrade fees for the rest of their infrastructure to offer ISDN. With the UMC, they could service ISDN everywhere through the UMC and bring the service back to a single office where the Class 5 switch had its ISDN upgrade.  There were many other places where configuration allowed lots of cost savings for smaller companies.

Now, there were many other ways that the UMC was organized to save smaller carriers money. I hope this outlines a single thread through the product and there were many others.

To lead into what challenges this created at large carriers, I hope you recognize that this meant that there was a huge number of possible product configurations. On top of that, there were several product categories that the UMC covered: Digital Loop Carrier (DLC), D4 Channel Bank, Fiber Multiplexer, Digital Subcriber Line Access Multiplexer (DSLAM), and Optical Line Terminal (OLT). Large carriers bought different products for each of those different applications. For the UMC, that meant a different approval for each application against different economic and technical competition. Each of these products followed different standards and I think this another topic for yet another blog post later!

Jim Sackman
http://www.jimsackman.focalpointcoaching.com/
We focus on your business – Time, Team, Money, Exit
Coaching, Sales Training, Web Marketing, Behavioral Assessments, Financial Analysis

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4 thoughts on “The Early UMC – Why did it work?

  1. Thank you for another fantastic article. Where else could anyone get that kind of info in such a perfect approach of writing? I’ve a presentation subsequent week, and I’m at the look for such info.

    1. Thank you for you kind thoughts. I have had the same writing style for a long time and am self taught at it. It takes me a couple of hours to come up with the posts. This has been eased considerably by having a theme for what I am doing. Beyond the theme, this is all about getting the topic outlined in my head and then just stream of consciousness writing. I clean it up afterwards.

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