AT&T is biggest incumbent in US carrier Ethernet market

AT&T is the biggest provider of carrier Ethernet services in the US among incumbent operators, with Level 3 Communications topping the list from Vertical Systems Group among competitive providers.

Meanwhile, in a third survey published on the same day by Vertical Systems, Spectrum Enterprise heads the leaderboard for cable multi-system operators (MSOs) offering carrier Ethernet services.

Vertical Systems ranks operators by size according to their share of US retail Ethernet ports in each of the three categories. The company uses its own database of enterprise installations, with input from its regular surveys of network providers.

“Retail Ethernet services sold by incumbent carriers grew 7% in the second half of 2016, trending lower than in the first half,” said Rick Malone, principal at Vertical Systems. “During the past year, major incumbents continued to virtualize operations functions and improve service delivery cycles to improve profitability.”

On competitive providers, Malone said they “must excel in key areas like network scalability, dynamic service features, fibre reach, SLAs or network resiliency. Because of these distinctive competencies, it is no surprise that top companies like Level 3 and XO, as well as others in this segment, have been prime acquisition targets for larger service providers.”

XO, which came second in the competitive carriers list, was bought by Verizon in February 2017. “Year-end 2016 US Ethernet share figures for XO and Verizon are reported separately,” said Vertical Systems.

Cable MSOs were the fastest growing sector in carrier Ethernet, said Malone. “This segment realigned in 2016 with Spectrum Enterprise rising to the top as a result of Charter’s acquisitions of Time Warner Cable and Bright House. Additionally, Altice USA advanced as a major player in the cable MSO segment on combined Ethernet ports from its acquisitions of Suddenlink and Lightpath.”

AT&T, Verizon, CenturyLink and Windstream headed the leaderboard for incumbents, in that order. Level 3, which heads the competitive carriers list, will become part of CenturyLink shortly. It was followed by XO, now part of Verizon, and then Cogent, Zayo and Sprint. The cable MSO leaders are Spectrum Enterprise, Comcast, Cox and Altice USA, in that order.