Z-Tel Communications is experiencing a rebound in the consumer services arena. Since September, when the company’s new management decided to re-engage its original market, Z-Tel has reversed a trend toward attrition and added more than 20,000 consumer customers to reach 230,000 total business and consumer lines.

That number exceeds the previous projection of 225,000 and led to guidance from Z-Tel that it would hit projected fourth-quarter EBITDA of $2.5 million.

Having read the UNE-P handwriting on the wall, Z-Tel is now turning to voice over IP to deliver its business and residential voice services. The national CLEC has installed and tested a VoIP network in Tampa, Fla., and will add service in New York City in mid-January and Atlanta after that.

At its peak, Z-Tel served 260,000 consumer customers, reselling local access lines under the federal government’s UNE-P requirements that established discounts for local competitors. When federal support for UNE-P fades, Z-Tel allowed its consumer business to shrink, focusing on business service bundles.

Now, according to Z-Tel CEO Trey Davis, the company will have a dual focus, including using UNE-P where possible and deploying its own facilities as well.

How quickly Z-Tel rolls VoIP out nationally will depend "on money--how this works and how we do with it," said Andrew Graham, corporate counsel for Z-Tel.

Z-Tel developed its own value-added services, including a personal voice assistant, Web-based service activation and a network-based personal assistant service, to build its customer base.

Z-Tel, which will change its name to Trinsic in January, said it will use Cisco Systems’ softswitches and Integral Access PurePacket broadband access platforms to deliver the VoIP service as it moves away from dependence on Bell networks.