August 21, 2013

O Canada Here We Come

This week XO Communications expanded our service capabilities north of the border, announcing that we can now provide a wide range of data and IP-based networking services throughout all of Canada. This follows our announcement in 2012 of the extension of our network into Toronto with the lighting of a fiber ring connecting Toronto and several US markets together. This new announcement further underlines our commitment to expand our international capabilities for mid-market, enterprise, and wholesale customers.

There are many reasons why XO is making such a commitment to Canada.  Not only are there several large industries that require high-speed cross-border networking needs, but most of the businesses and population are within 90 miles of the U.S. border.

The Canadian market will be a seamless addition to all of our US markets. Now businesses in Canada will have access to XO’s route diverse, high speed network across the entire country. XO services available throughout Canada include Dedicated Internet Access (DIA), high-speed IP transit, MPLS IP-VPN, VPLS, Ethernet, Private Line and Wavelengths for both enterprise business and wholesale customers.

In his blog post , Cross-Border Traffic Driving Higher Network Speeds, John Hanton provided excellent insight into the Canadian industries that will are driving the need for networking solutions across the U.S. – Canadian border.  I’ll recap some of that blog here below.

Cross-border traffic tends to follow North-south lines linking, for example, financial centers in Toronto with New York and film and television production in Vancouver with Los Angeles.

Toronto, Ontario: Financial Hub

The Toronto area, home to 40% of Canada’s businesses, is a finance, manufacturing, media & entertainment and retail powerhouse.  “Brand name” companies in the Toronto area include:

  • Finance: CapitalOne, TD Bank, and Fidelity Investments Canada Limited
  • Media and Entertainment:  Corus Entertainment (HBO Canada and others), Sony Music Canada, and numerous production and post-production TV and film companies.
  • Manufacturing: The Toronto area is #2 in North America for auto production. Ford, General Motors, Chrysler, Honda and Toyota all have major manufacturing operations there.
  • Retail:  Target has just expanded into the Canadian market. BestBuy (Future Shop), WalMart & Costco operate stores across the country.

Calgary, Alberta: The Oil Patch

Canada is the world’s 3rd largest producer of natural gas. Its reserves rank #3 in the world. Familiar names such as Shell Canada have major operations in Alberta but also require access to operations and partners scattered throughout the US, primarily in the Gulf Coast region.

Vancouver, British Columbia: Hollywood North

U.S. entertainment companies with operations in British Columbia include: Lucasfilm, Industrial Light & Magic, and Sony Pictures – Imageworks Canada.  Meanwhile, Lions Gate Entertainment Corp. (“The Hunger Games”) is based in Vancouver and has significant operations in the Los Angeles area.

The film and television production industry is but one example where the requirement for ultra-high speed connections is driving the need for bigger cross-border telecom connections.

XO Communications has expanded its network into Canada with these customer needs in mind. With Canadian-United States trade growing at about 5%+ per year and the need for high speed connectivity growing even faster, XO is well positioned to serve its customers with a presence in Canada.

Let me know what you think about XO entering the Canadian telecom market and where you think XO should expand its network next.

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