Wireless broadband service provider Nextlink Communications Inc. ushered in a new look and feel for the company last week, announcing it changed its name to XO Communications and now will offer inclusive flat-rate service packages.
“This industry has made it much too difficult for business customers to buy voice and data services and they are literally overwhelmed,” said Dan Akerson, chairman and chief executive officer of XO. “As we take steps to transcend the complexity clouding the marketplace today, it is the right time for our company to reintroduce ourselves with an aggressive, breakthrough brand.”
The service packages, called XOptions, feature flat-rate pricing for bundled voice and data products, including local, long distance, Internet access and Web hosting. The Web hosting service includes e-mail, domain registration, site hosting and development and e-commerce tools, XO said. They are designed to accommodate different sized business customers with 10 to 100 employees per location.
Customers can purchase time in buckets of 4,000 to 5,000 minutes, at 384 kilobits per second or 1.5 Megabits per second data rate speeds. XO offers 11 different packages, and the pricing varies depending on location and data capacity.
“Essentially we view the long-haul networks as an enabling asset, but the true value is achieved in the local loop on a broadband basis,” Akerson said.
He said the company’s name change is reflective of its January merger with Concentric Network Corp. and the resulting transition to a full-service, broadband communications provider. XO holds the rights to a 16,000-mile high-speed fiber optic network and owns local multipoint distribution service spectrum licenses which cover about 95 percent of the U.S. population, although right now, XO plans to only serve the business market.
“It’s a little more problematic on a residential basis … there may be some sort of competitor in the far reaches of a residential network but the concentrations now, and where the investment in broadband facilities is, is in the middle- to higher-end of the market,” Akerson said. “I think it’s going to be a number of years or a combination of DSL by the RBOCs deeper in the network, their permission to get into long distance, and I hate to say this, but the remonopolization of local and long distance in the consumer market” before companies like XO are able to achieve home access.
On Wall Street, share value of XO jumped nearly 15 percent to $32 upon news of the name change last Monday. The stock was trading even higher, at $34.31, at RCR press time. Financial analyst firm Legg Mason reiterated a “strong buy” on the company’s stock. XO began trading under the ticker symbol “XOXO” on Sept. 26.
The XO brand will be introduced to the public during the next few months with a $20 million television, print, direct mail and radio advertising campaign produced by McKinney and Silver.
