Sunday, December 22, 2013

Possible alternative to capitalize U.S. FTTP build out emerges in Utah

Building infrastructure of any kind is a costly undertaking, including fiber optic to the premise (FTTP) telecommunications networks. Those high capital costs have crimped FTTP build out in the United States, challenging existing telephone and cable companies as well as newcomers like Google Fiber.

In Utah, a new strategy is emerging involving a global firm that with patient capital that specializes in big dollar infrastructure projects. The Salt Lake City Tribune reports Macquarie Capital Group, an Australian firm that advises and invests in public projects around the world, will launch an engineering and feasibility study to operate Utah's 11-city UTOPIA FTTP network in a public-private partnership: 

Macquarie’s investors — including pension funds, large insurance firms and private endowments — were seeking to develop stable, long-term investment opportunities and were drawn to technology-based projects, Hann said. 

If the feasibility study proves fruitful and Macquarie agrees to take over the network, it likely will entail a deal in which the firm would assume management of the network for 30 years and invest in building out and upgrading the rest of the lines to neighborhood homes, Hann said. 

The network would remain an open-access network and Macquarie would partner with third-party Internet service providers, he said.

Tuesday, December 17, 2013

First indication of AT&T withdrawal from residential wireline market

Sensing AT&T's lukewarm commitment to its residential wireline business segment, in 2008 I predicted that AT&T would abandon the segment in the first half of 2010. The telco is still in the residential wireline business as 2013 draws to a close. But a slow withdrawal could now be underway, one state at a time starting with Connecticut.

Bloomberg reports today that AT&T will spin off its Connecticut residential landline unit, including Internet and TV services to Frontier Communications for $2 billion.

AT&T relies on copper cable plant to deliver premises Internet service, scotching plans dating back to the late 1980s developed by regional bell operating companies AT&T absorbed in the 1990s to replace the last mile copper network with fiber optic cable. That reliance has technologically limited the reach of AT&T's Internet-based service offerings since copper was designed to carry analog voice service and not digital Internet signals that can be reliably delivered over only short distances using copper.

AT&T's relationship with Connecticut hasn't been a copacetic one. In 2007, then-Attorney General Richard Blumenthal pressured the telco to make its U-Verse product offering available to all residences in the state. Blumenthal, now a U.S. senator, said this week the deal should be reviewed to ensure it is in the interest of consumers.

Monday, December 16, 2013

Verizon CEO hints at fiber partnerships with local providers

Verizon, which halted build out of its FiOS fiber to the premise (FTTP) infrastructure last year, will stay that course Verizon CEO and Chairman Lowell McAdam said at last week's UBS Global Media and Communications Conference.  McAdam said some "fringe" deployment may occur, but that "deploying fiber in a lot of new markets isn't in the cards."

However, "I think there are more opportunities to partner out of market with companies that are there versus us going in and deploying FiOS," McAdam added.

McAdam's remarks were reported by Fierce Telecom

Verizon spokesman Bob Varettoni declined to elaborate on McAdam's comments when asked specifically with whom Verizon might partner to build FTTP infrastructure beyond its current footprint.
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