Lots of facilities-based service providers have discovered the business value of operating "out of territory." Many are looking at growth strategies based on buying assets, effectively converting an "out of region" strategy into an "in region asset. 

Sometimes known as the "edge out" strategy, service providers who might be incumbent service providers in one region or area create "competitive local exchange carrier" business units that create and sell services to customers, typically business customers, outside the historic franchise area, using leased access facilities. 

With the advent of cloud computing capabilities, perhaps a third option now will emerge: incumbents who have become CLECs might also become cloud-based, over-the-top providers of their current services, over a wider area than the edge-out strategy suggests. 

Where the incumbent approach is based on "owned" access and other facilities, and the "edge out" strategy is based on leased assets, the cloud-based approach makes any service provider an "over the top" supplier of services. 

That might seem more unusual than the typical "acquisition" or "edge out" approaches, but accomplishes the same sorts of goals, namely expanding the potential number of customers to whom services can be sold. As an incumbent, a service provider sells only to locations within a franchise or other area where a certificate of public necessity and convenience has been issued.

In a CLEC scenario, an incumbent expands geographically by leveraging existing assets out of territory, out of the local area where it owns and operates the access facilities. 

In a cloud scenario, a service provider simply decides where it wishes to sell services, assumes the existence of broadband access, and creates "over the top" services that operate, in principle, the same way any other hosted service would operate "in territory."

Kevin DeNuccio, Metaswitch Networks CEO, and John Lazar (News - Alert), Metaswitch Networks chairman,  say some of their customers are looking at cloud-based approaches to further extend service beyond the classic edge-out CLEC model for local telcos. 

There are business issues with this approach, just as there are for the CLEC or "growth through acquisition" approaches. But the cloud scenario arguably avoids capital investment of the "buy another telco" type.