Wholesale service provider Progress Telecom is getting ready to launch a major expansion of its product line and its geographic territory.

For the last year, the company has been quietly putting its house in order, following the merger of the original Progress Telecom, a subsidiary of Progress Energy, and EPIK Communications in December of 2003, the new Progress Telecom emerged determined to expand its reach beyond the Eastern seaboard.

As a wholesaler of broadband services to other service providers, Progress is now gearing up to step in where regulatory changes have made it harder for competitive carriers to reach their customers. As a result, the company expects to be making a series of aggressive announcements in coming weeks, including new branding, geographic expansion and product improvements.

"We are positioned for growth," says Greg Tennant, vice president, marketing and strategic planning, and part of an experienced management team headed by Ron Mudry, original CEO of Progress Telecom. "There is a clearcut need for most CLECs is to find alternate methods of originating and terminating services. We are 98% carrier oriented and we provide an end-to-end solution for our customers, allow our customers to more easily reach end-user customers and end-user buildings."

The new company is owned 55% by Progress Energy and 45% by Odyssey Telecorp, parent company of EPIK. "We believe we are one of the strong players that comes to this market without having gone through bankruptcy," he says. "We’re cash-flow positive and we have cash in the bank from our investors, our parent companies."

After some degree of internal soul-searching, Progress decided to sharpen its focus on being "a neutral facilitator of wholesale services to other service providers," says Tennant, including voice over IP players, international carriers, wireless carriers and more.

"Our industry tends to be little children on a soccer field--everybody runs to where the ball is and nobody plays their position," says Tennant. "We want to play our position as a neutral facilitator of wholesale services to other SPs. We have who’s who of carrier customers, already, but we know there are additional markets and services we can provide."

A key part of that expansion is a relationship, sealed in November, with Stealth Communications, that will enable Progress Telecom to provide voice-grade interconnection service for VoIP carriers. Stealth owns and operates a Voice Peering Fabric, through which VoIP service providers can interconnect. Progress Telecom and Stealth now have an alliance to provide voice-grade interconnection, using Progress’ transport, to service providers and enterprise customers.

"Our goal is to facilitate simpler, more cost-effective interconnection," says Tennant. "We are enabling them to do so in a private QOS [Quality of Service] environment. Under this agreement, any carrier can reach Stealth’s peering fabric in New York on our network, using voice grade interconnection."

The interconnection is done using a Progress Voice Grade Ethernet circuit, delivered over the fiber-optic backbone it operates from Miami along the seaboard to New York. In addition, Progress has access to Stealth’s ENUM Registry, which maps telephone numbers to Internet addresses, using a look-up architecture similar to a Domain Name Server.

"We are using ENUM servers throughout our network, so we can keep local calls local and not carry them over the backbone," says Tenant. "This approach bypasses the PSTN, and connects VoIP calls on a private IP network. VoIP is a huge area of growth. With our peering service, we are really uniquely positioned as the only neutral facilitator. We let service providers create their own peering relationships and private gateway termination relationships. We don’t just ask them to pay us to terminate their traffic."

About one-third of Progress Telecom’s revenue comes from wireless carriers who buy transport between base stations and cell sites, and another third comes from international carriers. One unique service the company provides to the latter customer base is transport of its traffic into and out of the U.S. in its native SDH format, without requiring costly and less efficient conversion to U.S. SONET formats.

Tennant expects growth and expansion on all fronts, including with existing customers and new players.

"Suite of access services will be broad and comprehensive," he says. "In wireless, we are becoming much more of a full-service player, and we will be announcing new wireless capabilities."