This year’s MetaSwitch (News - Alert) Forum provided a host of proof points that service providers of all stripes can stay competitive so long as they deploy the right technology and have the right vision for serving their customers. In my mind the former is the easy part, and one of the reasons why MetaSwitch has been so successful is their ability to provide both for their service provider customers.

I have a few themes to explore from their forum, and this column will focus on what big carriers can learn from small carriers. MetaSwitch has built up a strong market position with smaller carriers – CLECs, RLECs, IOCs, etc. – and being among these operators for a few days was a great way to learn about their challenges and how MetaSwitch is helping them compete.

While many of these operators serve rural markets and have small subscriber bases, the customer needs – at least residential – have a lot in common with those in urban markets. These operators typically fly under the radar of mainstream coverage, and I was just one of a handful of outsiders invited to attend this event. As such, there is much to learn here that will apply to larger service providers for both residential and business subscribers.

The first thing that strikes you about MetaSwitch’s customers is their extensive use of fiber, most often to the home. I don’t have any data points to validate this, but almost everyone in my conversations has already rolled out fiber. Some are using it just to support telephony, but many are offering Triple Play bundles including IPTV (News - Alert). In fact, one of the most popular sessions of the conference was the panel discussion on IPTV. If this is news to you, then you need to pay more attention to what Tier 3 operators are doing with softswitch platforms such as MetaSwitch.

Setting aside the fact that these operators have different realities than Tier 1 carriers, it is clear to me that if they can innovate like this and adopt next-gen technologies despite all their limitations, then so can their larger counterparts. Some of these operators have done a great job reinventing themselves for the world of IP, and can offer many best practices for larger operators willing to listen.

I’m going to illustrate this with a few examples from one service provider that really stood out for me. The operator is TCT – Tri County Telecom – they are a rural cooperative based in Wyoming. As is typical for forward-thinking Tier 3s, they have grown by combining local exchanges, and acquiring neighboring exchanges from incumbents/RBOCs that were looking to exit rural markets. A natural outcome of this process is to consolidate multiple switches into a centralized network, and is often the impetus to partner with vendors like MetaSwitch.

Of course, centralization is just the beginning of the story. What MetaSwitch really gave TCT was a platform upon which they could deliver the services necessary to remain competitive. Like everyone else, they were losing long distance revenues and landline subscribers, and to counter this, pursued the Triple Play (News - Alert).

What’s striking about TCT is the extent to which they’ve done this, as well as their willingness to embrace not just IP communications, but social media tools. By partnering with vendors such as MetaSwitch, Calix (News - Alert), UNASAT and Myrio, along with building out fiber, TCT has laid a solid foundation for Triple Play services. For most operators, Triple Play is fairly straightforward, but TCT has taken things a few steps further that take fuller advantage of what these technologies have to offer. Consider the following examples:

VONTel – this is their white label VoIP service, offered primarily to their wireless subscribers. They also market it as an inexpensive second line, but overall, TCT has chosen to brand their own offering to compete more effectively against the pure play VoIP services.

Television – aside from being a passive distributor of other people’s content, TCT is actively engaged in producing their own local content. Being a cooperative and community-based, this type of programming is not that big of a stretch, but it’s not what you’d expect from your local telco.

SIP Trunking – TCT has been an early adopter here, and is using it to great effect. They’re offering unlimited long distance packages that have offset the declines in traditional metered plans, proving that legacy services are not yet obsolete. Furthermore, these plans strengthen the value proposition for landline service, making it harder for subscribers to cut the cord and go totally wireless.

IPTV/telephony integration – by making these elements work seamlessly, subscribers quickly adopt new habits such as checking voice messages while watching TV. This type of convergence is particularly important in TCT’s market where subscribers are more likely to get their TV service from satellite than cable. Satellite may provide superior TV service, but cannot match the integrated offering of Triple Play from operators like TCT.

High speed Internet for everyone – they offer this across all modes – copper, fiber, wireless – so the foundation is in place to continue offering new services as they evolve, such as FMC, making it more difficult for competitors to win business.

Online backup service – branded as Bolt LockBox, TCT has rightly recognized the need for remote backup, again creating a stronger bond with subscribers.

Social media – while rural markets may appear as laggards, TCT thinks otherwise. For them, the use of Facebook and Twitter are natural tools to maintain connectedness with their subscribers. Rural markets are very community-oriented, and for TCT, Web 2.0 is just another way to keep those ties strong.

I could go on, and mention simple things like free Internet training classes, but I’m pretty sure you’ve got the idea here. TCT is no ordinary service provider, and you’ll be hard pressed to find Tier 1s doing all of these things today. In time they will, but not yet.

To be fair, Tier 1s are certainly doing many interesting things, and Embarq (News - Alert) is a case in point. They also are a MetaSwitch customer, and were a showcase at their conference for how a Tier 1 can successfully deploy these technologies. One example is the recent launch of the eGo phone, which integrates telephony with the Internet on a cordless handset. While not as sophisticated as the iPhone, eGo adds communications richness and Web services to the home phone experience, making landline telephony more compelling for subscribers.

To make these services come alive, Embarq has instilled a culture of innovation across their entire organization. They do this by creating Innovation Councils for each functional area, and running an Innovation Lab where they learn and adopt best practices for innovation from sectors outside of telecom.

These are the types of things that Tier 1s need to be doing more of, and I suspect Embarq is well ahead of its peers on this front. They should certainly be following Embarq’s lead, but for my money, Tier 1s stand to learn a great deal from the likes of TCT. Nobody has a monopoly on innovation, but when you see how far many Tier 3s have advanced, you have to wonder just how well the majors could compete if they were on a level playing field. To make sure that doesn’t happen, my main message for Tier 1s is to look outside your back yard for innovation – there may be more going on than you realize.