Companies in North America spent between $1,500 and $2,000 per employee, on average, for wired and wireless services in 2008, approximately 20% of their total IT budgets, and growing. Choosing a network partner is a critical aspect of every organization, especially as more services and applications are moved from the enterprise to the cloud. Cost cutting and optimization continues to put pressure on network spending however. Combining wired and wireless voice and data services, now feasible with some carriers, has enabled enterprises to reduce total spending by getting more-favorable discounts and terms and conditions, for example. This year, Gartner has combined the wireless service provider Magic Quadrant and the network service provider Magic Quadrant to represent this trend (i.e., vendors will be offering single contracts for fixed and mobile services, and customers will buy them that way) and the increasing frequency we believe this will occur as we see more companies sourcing wired and wireless services from the same vendors.

This Magic Quadrant assesses the service capabilities of U.S. telecommunications service providers that offer wired, wireless or both types of services. Key findings include:

• Consolidate sourcing — Although wireline services are still typically multisourced, many adopters of wireless have consolidated the number of providers from whom they are buying.
• Reducing spending — Combining wired and wireless services often leads to reduced costs based on significantly larger volume discounting (often five to eight additional discount points, depending on volume increase), and as carriers continue to integrate teams, contracts, provisioning processes and support, soft costs for sourcing are decreased.
• Consolidation will drive converged products and services — Converged voice and data services is a longer-term goal for many companies that want to consolidate devices and networks, as well as take advantage of cross-network synergies. However, even the biggest providers have yet to fully combine all aspects of product delivery across wired and wireless services. This immaturity leads to service, contracting and provisioning issues.

U.S. Network Market Trends

Telecom services represent approximately 20%, on average, of total IT spending in North America. Network services are the most critical aspect of those telecom services to enterprise IT, because the business relies increasingly on high-quality voice and data connections to function — whether for providing data or sales online, via mobile phones for its workforce, or for remote access connections tieing branches, homes and headquarters together. As cloud computing grows — meaning storing data and applications outside the enterprise — reliance on network connectivity will only increase, with a demand for higher bandwidth, lower latency, higher reliability and balanced costs.

Spending on wireless technologies (services, devices and applications) also continues to grow at most companies, and Gartner estimates it is about 15% to 30% of the total telecom services spending, on average. However, it is easily the highest spending that can be attributed to individual users and has seen significant growth in the past few years driven by the adoption of wireless data technologies like e-mail, Short Message Service (SMS) and broadband access, and the number of enterprise users using these services. It is currently one of the key areas enterprises are looking at in 2009 to reduce spending and control costs. However, Gartner has not seen any significant change in the adoption of wireless services, because most companies continue to see it as a critical capability and continue to support it as a corporate service. And wireless telecommunications service providers (TSPs) are seeing increasing gains in enterprise revenue, again driven by the adoption of smartphones that support higher, more-complex functionality. In fact, most wireless service providers are seeing almost 25% of their revenue via wireless data, and the introduction of even faster-speed services reaching multiple megabits per second will only drive adoption further as usability and coverage increase.

On the wireline side, customers remain focused on driving costs out of virtual private network (VPN) transport and leveraging Internet Protocol (IP) for additional economies on voice and conferencing. As a result, Multiprotocol Label Switching (MPLS) rates have continued to show double-digit declines, while both domestic and international voice rates have also dropped. Renewals with incumbent providers still dominate, with product portfolios among leading providers offering similar capabilities at similar net rates. Three-year deals continue to be the center point for contracts, with customers looking to improve their leverage through more-flexible terms and lower-volume commitments. As a result, Gartner is starting to see more term-volume commitments and an increase in using wireless spending to satisfy minimum commitments. Ongoing cost containment has caused customers to be more willing to consider alternative providers in an effort to meet productivity commitments. Audioconferencing and site-based Internet access are two areas that continue to attract alternatives to the incumbent TSPs.

The largest U.S. TSPs are moving to support continued enterprise wireless adoption. At companies that offer both wireline and wireless, wireless is approaching and surpassing 50% of their total revenue. It is driving many of their investment (capital expenditure) decisions and is outpacing wireline in terms of technological advances, user awareness and deployment. This is the reason Gartner has decided to combine two previous Magic Quadrants — one based on network service providers and another on wireless service providers — into a single Magic Quadrant. The many mergers and acquisitions over the past decade have created a large number of companies that offer wired and wireless services, so many clients are already sourcing both from a single provider. Although the full synergy related to product, distribution and pricing has not yet been realized, Gartner believes the future is in this combining of service elements. Key technologies like IP Multimedia Subsystems (IMSs) and all IP wireless networks based on fourth-generation (4G) technology will further substantiate this position, although maturity will not be before 2015.

Combining Magic Quadrants

Our decision to combine the North American wireless service Magic Quadrant and the wired services Magic Quadrant stems from a few trends Gartner has observed during the past two to three years, and we believe those trends will continue to grow:

1. An increasing number of carriers are offering bundled services and acquiring the required assets to build and innovate with those services. While bundling/packaging is nothing new, the real shift has been in the carriers' willingness to own assets for both wired and wireless services. This asset ownership enables advantages in pricing, service customization and service/technology innovation.
2. With carriers increasingly combining contracts and the provisioning process, significant discount advantages are available to enterprises that are willing to commit those services to a single vendor (in many cases, they already are working with a single vendor, albeit with separate contracts).
3. As technologies such as dual-mode devices, fixed mobile convergence (FMC) software and unified communications increasingly blur the lines between wired and wireless services, enterprises and their users will not make distinctions between the transport medium.

Key Network Trends for 2009

In 2009, even as companies are looking to the next generation of services, across both wired and wireless, the key trends continue to be:

• Globalization — Although this Magic Quadrant only assesses U.S. capabilities, many companies are looking to globalize their sourcing and management of telecom services. Though this is not possible in wireless yet, about 60% of the companies we talk with are sourcing globally for wireline today.
• Cost optimization — Many companies are cutting down on spending due to reductions in their workforces or geographic closings, but spending per employee seems to be maintaining previous-year levels. Rather than reduce spending, many companies are looking at how to optimize their spending to spend smartly, especially when it comes to wireless services.
• Valuing the network — Network services comprise 20% of telecom spending, but most users take voice and data services for granted. IT is assessing how better to value the network as it relates to business revenue and applications, which helps justify spending and prepare for potentially increasing budgets as the economy recovers.
• Growing complexity — Combining both legacy systems and technologies with future technologies has created complex IT systems. As voice becomes an application on the data network, even more care needs to go into balancing speed, latency and jitter to provide high-quality voice, which was taken for granted in legacy time division multiplexing (TDM) systems, for example. Wireless access and devices, as well as increasing remote access (global travel), only exacerbates the issue.

This Magic Quadrant analyzes the TSPs offering wired, wireless or both types of services in the U.S. TSPs are entities that provide some form of telecommunication services (fixed and/or mobile, voice and/or data) to all or a subset of consumers, enterprises, governments and other TSPs. The focus is on assessing a carrier's capability to provide these services to the business market. Consumer services and products are not evaluated. However, the extent to which the vendors participate in these areas is taken into account in applicable criteria, such as financial viability and product portfolio. We also do not consider "pure" resellers or virtual network operators (VNOs) — that is, nonfacility TSPs that do not provide substantial value-add to the transport services they obtain from other TSPs.

The following summarizes the current criteria:

• Previous year revenue: More than $250 million
• Percent of revenue that's network-oriented: More than 25%
• Retail revenue: More than 50%
• Minimum percentage of revenue that's U.S.-based: 25%
• Percentage of revenue that's enterprise-oriented: More than 10%
• Number of enterprise clients: More than 10%
• Volume of Gartner inquiries: Moderate to high
• Gartner clients' contract activity/market penetration: Moderate
• Enterprise dedicated sales force: Yes
• Enterprise hardware sold: Yes
• Enterprise applications hosted: More than five applications
• Multiple network technologies supported: Yes

Although it was not required that TSPs offer wireless services, Gartner feels those that do offer closer to what the market is demanding will have stronger positioning in the future. Wireline networking is also important to support wireless offers and current enterprise needs, so stand-alone wireless service scores weaker.

TSPs that scored high on the ability to execute axis have services that meet both current and future client business requirements, are able to demonstrate superior sales capacity, and provide a positive service and support experience, including pre- and post-sales resources, and are responsive to their customers. Delivering a message based on technology differentiation is not a key factor in the delivery of consistent service. The ability to provide both wireless and wireline services either internally or with a partner is a strong differentiator for execution, but will be a necessity in the future.

Product/Service

Does the TSP provide the services and products that an enterprise requests? Are the services enterprise-grade and reflect the quality and reliability requirements? Does the TSP have a range of services (wireless, wired, data and voice) that enterprises need today? Will they bundle and separate out as required?

Overall Viability

Gartner believes that all the companies rated will exist (in one form or another) for, at a minimum, the length of their currently proposed contracts, hence the low weighting of this rating. However, enterprises should be concerned about whether or not an acquisition or sell-off of the carrier's assets, including customers, is in the near future.

Sales Execution/Pricing

Included in this rating are the responsiveness/amicability of the sales teams, the willingness to negotiate, and the pricing, both offered and settled upon, for enterprise clients.

Marketing Execution

Does the TSP actively and successfully market to enterprise users and upper management. This is not a rating of the consumer advertising or market outreach efforts, rather it's a rating of the TSP's enterprise outreach and associated programs only.

Customer Experience

This rating focuses on the end customers' experiences with the TSP, from any sort of sales contacts, customer care, support contacts and the experience while receiving the delivered service. This rating is determined by Gartner client input, TSP-provided references and other less-formal inputs.

Operations

This rating focuses on whether the TSP has established the organization and reporting structures to court and support enterprise clients, and whether it has invested in the network and operation technologies to provide the services and products at levels required by enterprise users.

TSPs who rated high on the completeness of vision axis had shared common service characteristics (application acceleration, unified communications and collaboration [UCC], security and cloud product strategies), but had one common criteria: They have innovative products that integrate both wireless and wireline elements. The highest-ranked providers have somewhat mature FMC-based offerings and contracts that integrate both services. Carriers that have wireless partnerships or that stated future plans of incorporating FMC within 12 to 18 months were ranked lower. Carriers that provided either wireless or wireline services only, or that stated no concrete wireless strategy within the next 12 months, rated the lowest.

Market Understanding

Does the TSP show an understanding of market trends and Gartner client requirements? Does the TSP make technology investments to provide services that enterprises will require in the future? How has the TSP approached the bundling of services for enterprise users?

Marketing Strategy

This is both a rating of the TSP's ability to package and bundle services, software, management capabilities and hardware, and its ability to communicate its unique attributes to the market.

Sales Strategy

Although account team performance and pricing are the primary inputs to this category, we also evaluate the sophistication of the sales teams and the scalability of the sales model. This category looks at partner strategies and how they will relate to future sales efforts.

Product Strategy

Does the history of the products and services reflect steady improvements and growth in functionality? How does the TSP's road map for services and product bundles align with future requirements?

Innovation

Does the TSP have a history of innovation, either in its technical service considerations or technology purchase decisions? Is it simply following the rest of the TSP herd, or is it actually striking out with unique services, packages or even hardware choices?

Leaders have a full portfolio of voice and data products across both wired and wireless technologies, with frequent offerings of combined services, coupled with above-average service and support, focused-enterprise investment, strong sales support, competitive pricing and a driver in the market in terms of technology adoption, partnerships and on-time launches. They have a strong vision that includes both internal innovation, an eye on joint ventures and partnerships, and the ability to deliver a consistent product and message.

Challengers exhibit good capabilities in the areas of service and support, pricing, and coverage, but innovation, strategy and product offerings planned and introduced are weaker than competitors. They may not understand the developing requirements of enterprises or the market, like in the increased adoption and demand for wireless technologies, but what they offer tends to be good quality. They are weaker in developing managed network and IT services, as well as providing robust enterprise portal functionality.

Visionaries have a clear understanding of the market and where it is going. However, they often lack the financial and people resources to execute on these directions.

Niche players are often strong in a specific element of execution (such as service and support), a specific customer base (small or midsize business [SMB] or consumer), geographic availability or in the product portfolio, but lack investment and a comprehensive vision and resources to emerge from a niche player. Only offering a family of fixed and/or wireless services does not relegate a vendor to the Niche Players quadrant, but a lack of vision in the packaging or lower-delivered service level will prevent a vendor from exiting the Niche Players quadrant.

AT&T's extensive portfolio of wired and wireless services positions it as one of the few choices for enterprises with truly global communication service requirements. Although it's currently the most aggressive with bundling its contracts, Gartner believes that negotiating price, and customized terms and conditions will be increasingly challenging for customers as AT&T works toward standardizing contracting and improving service delivery. AT&T has done a better job than its peers in preparing for a tough year by managing its debt-to-equity ratio, better aligning its wired and wireless sales and marketing divisions, and investing in strategic technologies like wireless data and cloud computing. Companies of all sizes should consider AT&T for both wireline and wireless services.

• AT&T's enterprise strategy for integrated fixed and mobile product bundles has moved forward in marketing, and includes unified contract vehicles for wired and wireless, along with monthly growth incentives and consolidated billing.
• The company has seen large gains in enterprise wireless "mind share" in the past year due to both the massive success and profile of the iPhone and AT&T's increasing attempts to bundle and sell iPhones into its wired customer base.
• AT&T has the smoothest route to next-generation broadband wireless services.
• AT&T has expanded, and will continue to expand, both its geographic coverage and product portfolio.
• Breadth of private data solutions, wireless data applications, and wireless hardware offerings continue to be strong selling points.

• AT&T has struggled with its own size, as the merging of companies, technology investments, sales teams and support organizations continues to produce customer complaints, and partners often lament at the amount of time and effort they must invest to produce results.
• While voice coverage is rarely called out as an issue with AT&T, third-generation (3G) data coverage and performance complaints among Gartner clients are frequent, although recent network infrastructure investments are starting to pay off in improved quality. As such, AT&T has lagged competitors in its wireless data card sales.
• The AT&T sales organization still struggles with the right alignment of resources and consistency across the product lines, with Gartner clients expressing responsiveness and post-install support on the wireline side.
• Continued economic pressures will limit capital investment by both AT&T and many of its peers.

Global Crossing continues to make consistent strides to improve its wireline product portfolio and service delivery in IP services. The company's strengths lie in high-touch WAN services, where locations are less rural. Global Crossing also has strong penetration in the U.K. (primarily government), and a very strong IP and data center footprint in South America and Latin America. Global Crossing typically wins business as a secondary provider and waits for the large incumbent to slip up; however, in these recessionary times, more people have considered Global Crossing as a primary provider based on both cost and capability. Global Crossing, however, needs to continually battle the marketplace perception questioning the company's financial staying power and low prices for IP services. Consider Global Crossing if your enterprise locations are in large metropolitan centers and you have moderate needs to manage network and IT services.

• Global Crossing has focused on selling managed services — including routers, security (through its VeriSign partnership), Session Initiation Protocol (SIP) trunking (including Microsoft Office Communications Server), databases and WAN optimization — not just competing with low-price connectivity.
• Improvements to a strong customer support strategy included enhancements in Global Crossing's portal, including change management, network alarming and class-of-service modifications.
• The company offers extremely competitive rates for MPLS and audioconferencing services.
• Global Crossing continues to provide better-than-market-average customer service and support to its client base, which predominantly consists of midsize and large enterprises.

• Global Crossing lacks a comprehensive go-to-market strategy, and its lack of strong mind share will inhibit strong revenue growth.
• The company's domestic footprint is limited to large metropolitan areas.
• Global Crossing has no stated plan to support handheld, wireless mobility products.

Level 3 has a strong portfolio of high-bandwidth services for very large enterprises that resembles service providers in their transport requirements. Midsize enterprises, however, remain a challenge for Level 3, with Gartner customers reporting dissatisfaction with the level of account team involvement in post-implementation issues and the quality of post-sale technical support. Customer with very high bandwidth requirements should consider Level 3 as part of a multiprovider strategy.

• Its portfolio of wavelength, IP trunking and metro assets puts Level 3 in a strong position for large enterprises building out with a service provider architecture.
• Level 3 competes effectively on price and packaging for high-speed, dedicated Internet services.
• The company has added an organizational focus on targeting enterprise opportunities that align best with the Level 3 portfolio.

• Network operations have not yet fully automated the integrated management of acquired networks, requiring specialized resources for network trouble resolution.
• Midsize customers are not satisfied with account team proactiveness and trouble resolution, especially in midsize VPN accounts.
• The lack of a mobility, unified communications (UC) or conferencing story limits the leverage Level 3 derives from services like SIP trunking.

Paetec continues to focus on delivering transport and basic services to a targeted set of vertical markets with an emphasis on service delivery, proactive customer support and price. Although Paetec lacks a global footprint, wireless assets and a broad service portfolio similar to larger competitors, its U.S. wireline focus has resulted in low churn and repeat customers. Paetec will be increasingly challenged by ongoing commoditization in its home market and the growing global reach of its midmarket customers. Midsize enterprises that place a priority on customer service should consider Paetec.

• Productizing the acquisition of MPX has given Paetec a fixed wireless alternative for business continuity.
• Regional and national user groups continue to be mainstays for Paetec, and generate positive feedback from Gartner customers.
• Proactive account teams and even more proactive billing services help minimize errors and build trust with customers.

• Lower network density in the U.S., the lack of an international footprint and the absence of a mobility story leave Paetec focused on a rapidly commoditizing U.S. wireline market.
• Paetec has an industry solutions focus, but lacks comprehensive vertical solutions and the managed services portfolio to fully penetrate its target vertical markets.
• Despite lower brand recognition than larger competitors, Paetec still has not fully consolidated the McLeod and Paetec brands under one brand image.

Qwest continues to deliver a competitive, core service portfolio, making it both a competitive provider of converged transport, as well as a viable alternative to the larger providers for enterprises. Qwest is adding a vertical focus to capitalize on stimulus spending and is investing incrementally in a growing IP service portfolio. Qwest should be considered in regions where it sells its services (not a national provider) as a primary provider, as well as a primary or secondary provider out of region or for larger domestic networks.

• Competitive data pricing and simplified product packaging create ongoing opportunities for Qwest in underserved midsize enterprises.
• Proactive debt management and enhancements to the IP service portfolio sustain Qwest as a viable alternative for enterprise opportunities.
• Qwest is in a strong position to benefit from an increase in government spending through existing federal government contract vehicles.
• Reselling Verizon Wireless voice and data services offers a compelling device, coverage and performance product for Qwest, albeit often at a higher cost.
• An early proponent of bundling, Qwest has built a promising package of owned and resold services.

• Lack of a wholly owned wireless capability will limit converged opportunities for Qwest in target markets, if pricing pressure is intense.
• A brief period of customer uncertainty is being addressed following the perception by both customers and prospects that the enterprise division was for sale.
• Qwest relies on partners for out-of-region access, which limits the control over access efficiencies enjoyed by larger competitors.
• Wireless-only services are not generally available, and there is no real value added in bundling.

Savvis continues to be an IT services provider (hosting and cloud computing) that also owns IP-based network services. The company made significant investments in its U.S.-based networks, which primarily connect its 28 data centers to create low-latency network and hosting capabilities. This architecture resonates for trading applications and financial exchange connectivity, as well as for general enterprise needs. Recent network enhancements include improved mean time to repair and installation time frames, as well as Cisco certification for MPLS, firewall and telepresence delivery. All the feature improvements on Savvis's network road map enable the company to compete with larger providers, but the network sales strategy must become broader and target non-Savvis hosting clients. Companies that have multiple network locations in nonmajor cities will not fit well with Savvis's expanding metro city Ethernet. Consider using Savvis when you are consolidating your communications and IT services into one of Savvis's data centers and require switched voice, conferencing and mobility.

• Savvis took previous investments in network transport and added multiple quality-of-service levels and video and telepresence services.
• Savvis is one of the few U.S.-based carriers that has products that support hosting and low-latency network connections in many of the major financial exchanges.
• Savvis has greatly extended its Ethernet access footprint to most major U.S. cities.
• Future product enhancements include virtual private LAN service (VPLS), customer-managed on-premises equipment and hybrid WAN optimization/content distribution network services.

• A limited product portfolio that does not include remote access, conferencing or IP trunking hinders larger-client deal acquisitions.
• Savvis has no stated plans to support mobility services.
• Despite accounting for one-third of its revenue, network services are not the core focus for Savvis's account teams.

Sprint Nextel has been through many changes in the past year and has seen a consistent decrease in wireless subscribers especially. This has hurt the company's financial position as operating revenue declines. However, the first half of 2009 has seen a stabilization to subscriber losses and an improvement on financial metrics. This was driven by improved customer experiences on both the code division multiple access (CDMA) and the Nextel networks, reporting an increase of 39% in customer satisfaction, even as it shut down 17 call centers. However, Sprint continues to focus and invest more on wireless than wireline, and on the consumer market (acquiring Virgin Mobile) versus the enterprise. Its gamble on WiMAX as a next-generation network through its joint venture with Clearwire has yet to show promise. Companies should look to Sprint Nextel as a secondary wireline or wireless provider in the U.S.

• Sprint Nextel has well-integrated wireless and wireline products, and a well-integrated sales group, due to the recent formation of the Business Market Group.
• The company has seen much success with bundled wireless products, 3G data services and unlimited flat-rate plans (Simply Everything).
• It has a strong 3G CDMA Evolution Data Optimized (EV-DO) network in terms of coverage, average throughput and quality.
• The company has a best-in-class FMC strategy and products by bundling hosting and in-building coverage/pricing plans into a single solution, although dual-mode with Wi-Fi is not supported.

• Investment in its wireline network still lags competitors.
• Sprint Nextel has a weak international wireline and wireless strategy.
• The company is more consumer-focused than enterprise-focused, with new subscriber additions increasingly adopting prepaid services.

Tw telecom is a metro fiber and Ethernet provider that has begun to balance its sales focus to include MPLS-based WAN services. This has enabled tw telecom to participate in more-competitive bids then ever before, although the company's sales focus remains on metro Ethernet opportunities. Tw telecom will need to improve its weak marketing, showcase its national network and underscore its strong financial viability to gain improved mind share. Tw telecom should be considered as a secondary provider, where available, for SMBs with metro requirements, and anywhere high-speed access is available.

• Tw telecom continues to be the leader in VPLS-enabled multipoint technology and services.
• The company has a managed router offering that supports both Cisco and Adtran, providing options for SMBs, as well as larger enterprises.
• It offers lower-cost, MPLS-based WAN solutions that are available in 75 markets.
• The company has a strong local capability with connections to more than 9,000 buildings.

• Despite its rebranding in 2008, most enterprises do not include tw telecom on their bid lists, as they don't understand the depth of the company's services.
• Tw telecom has no plans to offer mobile data or cellular voice services to its client base.
• The company's sales strategy leads with metro Ethernet as a key value proposition, which only addresses a portion of most enterprise communications requirements (i.e., remote access and WAN optimization). This frequently relegates it as a secondary or tertiary metro provider.

T-Mobile continues to position itself as a lower-cost, alternative wireless service provider for many enterprise clients. While T-mobile has been quite aggressive with its consumer-centric FMC offering, T-Mobile To Go — even going as far as to offer it as a remote worker alternative for it's customers — the company still lags behind all the other major wireless providers when it comes to data service performance and 3G to 4G planning and investments. T-Mobile also lacks a wireline footprint to service U.S.-based enterprises. Without a wired service offering, T-Mobile is most appropriate as a secondary wireless carrier or as a cost-effective hedge.

• T-Mobile is generally responsive to customers and receives high marks for customer service.
• The company has the lowest-cost pricing plans for a bundled, unlimited flat rate.
• T-Mobile has a large selection of international-capable phones and smartphones.
• The company has a strong unlicensed mobile access (UMA)-based FMC offering for remote workers (although only available in the U.S.).

• T-Mobile has no wireline offerings for U.S. enterprises.
• It has weaker enterprise wireless application support and partners.
• There is no global sourcing available with European owners.
• The company has a small, direct sales and support staff compared with its peers.
• The company has a consumer focus versus a strong enterprise bent.
• T-Mobile struggles with 3G coverage and its 4G strategy due to its frequency ownership position versus wireless competitors.

U.S. Cellular is a pure-play, regional wireless service provider specializing in the central U.S. mostly in Tier 2 and Tier 3 markets based on population. Although U.S. Cellular and its parent company, Telephone and Data Systems (TDS), has remained independent, despite the recent wave of wireless consolidation, its ability to service enterprise clients and bundle services is limited. Although U.S. Cellular offers nationwide voice roaming and 3G services, it is not generally used as an enterprise wireless provider for national enterprises. It does offer strong local coverage and presence where available. U.S. Cellular should only be considered for in-region wireless services as a secondary provider.

• The company has strong local market specialization, local points of presence for support and sales, and deeper coverage in many Tier 2 and Tier 3 markets.
• It has focused customer care for midsize enterprises.
• Although basic, U.S. Cellular has hosted wireless applications (e-mail, navigation, etc.), smartphone offerings and 3G data cards.

• U.S. Cellular has no coordination with the wireline venture of TDS, and there are no bundled offerings, resold or otherwise.
• The company does not focus on enterprise-class services — it's consumer-oriented.
• Lack of nationwide coverage limits U.S. Cellular's ability to compete aggressively for enterprise clients with even nationwide wireless requirements. The company will not bid if international requirements are present.

Verizon is a consistent leader in U.S. wireless services through its high network quality for both wired and wireless, and its continued investment and fiscal responsibility. Although Verizon is not as far along on converged contracts and services as competitors for larger customers, it uses a single integrated service contract for wireline and wireless services called a Multiple Product Service Agreement (MPSA). The MPSA provides some joint general terms and conditions for Verizon's services, with additional company-specific terms and conditions.

Verizon has also improved its customer portal, the Verizon Enterprise Center (VEC), to be industry-leading in ease of use and features. The VEC offers a single sign-on solution among Verizon Wireless's My Business Account, Verizon Business and Verizon Business Customer Centers. An enterprise customer is able to log in one time to the VEC portal and manage all Verizon telecommunication services, including billing and any moves, adds, changes, deletions (MACD) needs. Verizon should be considered for midsize and large enterprises for wired and wireless services.

• Verizon has strong network quality and coverage for wireline and wireless.
• It's a leading technology adopter, pushing next-generation broadband long-term evolution (LTE) technology for wireless groups, but with the caveat that LTE service will not be nationwide for at least three to four years.
• Verizon has the continued perception of offering the best-quality wireless voice and data network, especially in the Northeast and West.
• The company's large IT investments produce modern back-end systems; has the strongest customer portal.

• Verizon has not fully integrated its sales teams and products between wireline and wireless as some of its competition has done, due to the separate company ownership restrictions of Verizon Business Group and Verizon Wireless.
• Although fairly competitive for larger accounts, Verizon has not expanded its capabilities to smaller spending, and remains a higher-cost alternative for wireless contracts that are less than $5 million a year.
• The company relies heavily on boilerplate responses to RFPs and depends on volume more than content to tell its story.
• International wireless support (devices and data services especially) has improved, but lags the company's main competitors.
• Verizon has no real Wi-Fi WAN strategy, unlike T-mobile and AT&T, beyond supporting increasingly more smartphones and other devices (MiFi, for example).
• The company improved its pricing plans, but has far fewer international wireless phones and data cards than competitors.

XO Communications has begun to execute on a strategy shift to incorporate more sales to midsize and large enterprises. Historically, XO focused on SMB telecom products and wholesale, high-capacity data circuits, so this shift was made without taking on any debt. This focus shift has opened up XO to larger bid situations, although the company finds that it is not always able to compete with larger carriers with more-diverse service portfolios. XO has an extensive network of local fiber assets that it leverages for strong growth for both enterprise and wholesale segments, but XO recognizes the need to incorporate value-added services to supplement its portfolio with IP voice and data services. Midsize U.S. enterprise customers should consider XO, especially for converged voice and data.

• XO's IP voice products have simplified bandwidth-only pricing models, and are much easier to buy.
• Innovative solutions including mass notifications and fixed wireless, in additional to core offerings, will help XO create vertical-specific bundles for healthcare, financial services and retail organizations.
• XO's growing portfolio of products now includes Ethernet WAN and wavelengths up to 10G.

• The company's product portfolio lacks value-added service such as enhanced conferencing, WAN optimization and the advanced portal capabilities (self-service features) to help monitor and manage those services.
• XO's current wireless offerings include fixed wireless only, with no immediate support for mobile data or cellular voice services.
• Despite increased investment and a focus in service delivery and support, Gartner clients report that XO still faces challenges in responsiveness and problem resolution.