Fleeing the CLECs

As money dries up in the CLEC industry, operations support systems vendors find themselves looking for new revenue streams. Recently, two software providers, MetaSolv and Daleen Technologies, announced new markets for their products. MetaSolv said it would target International and enterprise customers for its OSS software. Similarly, Daleen Technologies has set its sites on the wireless data arena.

In an analyst conference call, MetaSolv acknowledged its need to diversify its customer base as the driving reason behind the move into International and enterprise markets. MetaSolv says it plans to derive 10 to 15 percent of its revenue outside of North America in 2001, growing to 40 percent by 2004. "OSS spending in Latin America and Europe is expected to grow from $9 billion to $14 billion by 2003," said Dana Brown, vice president of marketing at MetaSolv.

Daleen Technologies also says softness in the ICP market has provided incentive to explore new markets such as wireless data. "The genesis of this company was Tier 2 and Tier 3 ICPs," says Craig Vosburgh, Daleen's director of product marketing and market development. "But relative to the whirlwind that's taking place in wireless, ICPs seems like a quiet ground right now," he says.

Daleen hopes to take some of its strengths, such as usage-based billing, to the wireless data market. Right now, many wireless providers are forced to charge flat rates for wireless Web services because their billing systems can't handle usage-based IP billing, says Vosburgh. Daleen has recently begun to make inroads into the industry. At the end of January, Aether Systems announced it would use Daleen's BillPlex Plus software to manage billing for its next-generation wireless data services.

Targeting a new market often means making changes to accommodate new customers. By 2004, MetaSolv plans to locate 20 percent of its resources outside North America. And the MetaSolv Solution 5, scheduled to ship in April, has eliminated dependence on the Telcordia standards that are prevalent in North America. The company is also adding additional languages including Spanish, French and Portuguese.

Copyright © 2004 Ziff Davis Media Inc. All Rights Reserved. Originally appearing in The Net Economy.