Level 3 Communications Question # 1 –Charles Handy

The planned strategy of Level 3 Communications during the early 1990s was fairly simple. According to Jim Crowe, the growth of the Internet was the mother of all business opportunities.” With this in mind, Crowe set out to “raise money, rapidly build a high-capacity fiber-optic network that linked major cities in the United States, and then cut prices to attract demand from major users of fiber-optic networks.” This would be possible, Crowe assumed, because he was under the belief that demand was going to “far outstrip supply” and that network growth was over “1,000 percent a year.”

The second part of Crowe’s Level 3 Communications strategy was to work exclusively for “service providers and corporations.” These clients would be the one to utilize Level 3’s fiber-optic network more than any other potential client, which helped with Crowe’s financial model because the profits that would be garnered from these clients would be equal to or leveraged against the volume and once the built in costs were covered, money would come rolling in.