Who Stirred the Pot?

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Today we learn that service provider Windstream buys Paetec for $891 million.

Now what equipment are they going to sell?

Paetec claims to sell:

  • Avaya – Platinum Partner
  • Cisco – Silver Partner
  • Nortel – Certified Reseller
  • ADTRAN – Authorized Partner
  • Allworx – Authorized Partner

Though I am not sure how neutral they are as Paetec owns Allworx.

Meanwhile, over at Windstream, they list  Mitel and Avaya as their equipment solutions. Note, Mitel is listed before Avaya, so its not alphabetical. Also, Mitel awarded Windstream Partner of the year for its top Revenue.
Me thinks in one year it will be Mitel, Avaya, and Allworx on the Windstream line card for telephony equipment.
Cisco Silver isn’t fitting for such a large service provider. Nortel is obviously out. ADTRAN is a bit of a wild card, but I suspect the relationship is more about termination equipment than UC equipment. ADTRAN does have a nice UC solution though. There probably isn’t much incentive to keep or toss Avaya, so it will stay. Allworx is family.
Other than the CPE shakeup, the deal probably makes sense. Windstream is looking to focus more business clients, and has its market hold primarily in the midwest and Southeast. Paetec has a stupid name anyway and primarily serves the Northeast and West. Windstream also gains access to Paetec’s data centers – 13 of which are new.
From: Telecom Ramblings:

When complete, Windstream will have become a national CLEC. It had been moving in this direction for years with the purchases of Nuvox and KDL, but until now those revenues had been relatively small next to the ILEC business. PAETEC, however, has revenues now of about $2B annually, following the purchases of Cavalier late last year and XETA this spring. And if you go further back, there are a plethora more deals that have brought quite a roll up of CLEC-type assets into Windstream’s camp. Add all of them up and the CLEC business will contribute as much as 70% of Windstream’s $6B in run-rate annual revenue. The company’s enterprise business overall will clearly be their primary focus from here on out, and they obviously haven’t run into any big problems being both an ILEC and a CLEC thus far.

Dave Michels