Researchers at TeleGeography say Tuesday’s Level 3-Wiltel deal could prove to be a turning point for bandwidth pricing, which has been trending steadily downward amid a worldwide fiber glut. TeleGeography, a unit of Primerica, wonder if the bandwidth market has hit bottom. An excerpt:
Level 3’s acquisition of WilTel represents a major U.S. market consolidation and another step on the path toward price stability for long haul network services. Could this signal the bottom of the bandwidth market? Within the United States, bandwidth prices have been leveling for almost a year on some major routes. For example, average pricing for 155 Mbps leased lines between Los Angeles and San Francisco have only declined 5% in the last year; on the New York-Washington, DC route prices have actually increased.