Today's Top Stories Windstream (Nasdaq: WIN) may not be a wireless operator itself, but it has become a key member of the wireless ecosystem as a provider of Fiber to the Tower (FTTT) backhaul services.  | | Gardner (Image source: Windstream) | Speaking at the Citi Global Internet, Media & Telecommunications Conference in Las Vegas, Jeff Gardner, CEO and President of Windstream, said that in 2012 the provider improved its methods to deliver FTTT. "We made a lot of progress with our ability to quickly turn these up for our customers and begin generating revenue," he said. "In 60 percent of the markets, we are the incumbent so the failure to win those contracts would have meant two things: letting another competitor in and losing all of the TDM revenue that we get today from the circuits that we provide to wireless carriers." By the end of 2013, Windstream will complete the majority of of its FTTT buildouts in both its traditional legacy regions and in new regions it entered through the various acquisitions it made in recent years. About 40 percent of the service provider's FTTT contracts are in these new regions. While Windstream has been providing traditional TDM-based backhaul in its own legacy markets for a number of years, it bolstered its out-of-market wireless backhaul capabilities when it purchased Kentucky Data Link (KDL) in 2010. "When we bought KDL in 2010 we got a long-haul network, which really made us a logical bidder for some properties outside of our footprint today," Gardner said. Gardner added that as it winds down its FTTT roll out, the investment will be reduced from $250 million to $125 million in 2014. At the same time, the ongoing growth of wireless data and the opportunity to serve more than one tenant at each cell tower means that there will plenty of services to sell. "The Fiber to the Tower model was built and justified with an assumption of there being only single tenant," Gardner said. "Companies like American Tower have five or six carriers hanging off those towers so there are lots of opportunities to pursue." Like other telcos, Windstream has to also deal with the near-term revenue loss that results from the migration of copper-based TDM to fiber. While Gardner admits the migration process is an issue, he said that because it has processes in place to more efficiently roll fiber to the sites it can mitigate TDM losses. Although many wireless operators purchasing backhaul begin at a certain rate, what they pay to Windstream will increase as their customers' data use grows. Unlike TDM-based circuits, which were designed mainly to accommodate voice, fiber will be able to meet these higher wireless data speeds. "We're building these sites much quicker than we did originally and the wireless carriers are grooming their sites more effectively," he said. "Obviously, they want to take full advantage of their investments as quickly as possible, which means will take more an upfront on the TDM, but it also means that more traffic will get pushed to that fiber connection." FTTT continues to be a larger factor in Windstream's wholesale revenue machine. Although Windstream's overall wholesale revenues declined $220 million year-over-year in Q3 2012, carrier service revenues rose 3 percent year-over-year to $162 million, a factor it attributes to ongoing fiber-to-the-tower installations for its wireless operator customers and other carriers. For more:
- listen to the webcast (reg req.) Related articles:
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Windstream Q3 revenues get boost from broadband, business and FTTT sales Read more about: investor conference, FTTT
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Equinix (Nasdaq: EQIX) on Wednesday announced it would spend $43 million to build its fourth International Business Exchange (IBX) data center in Tokyo. The new data center, which is called TY4, is being built to address the growing customer demand for data center services in the ?temachi area in addition to providing a larger set of network connectivity options. TY4 will be launched in two phases and will offer total capacity of 750 cabinet equivalents. Set to be completed in Q3 this year, the first phase will offer initial capacity of 450 cabinet equivalents. To accommodate the need for more customer interconnections, TY4 will also offer customers direct fiber connectivity to Equinix's three other IBX data centers in the city. Equinix could not have chosen a better time to expand its data center holdings in Japan. An IDC report forecast that Japan's data center outsourcing market will reach JPY 1.4 trillion (USD 20 billion) in 2015. During the five-year period of 2010 to 2015, Japan's colocation market will have a CAGR of 4.2 percent, reaching JPY 742.6 billion (USD 9.26 billion) in 2015. ?temachi is another prime location to build a data center as 90 percent of Internet traffic is being exchanged in the area. What's more, the city is also the home of over 4,000 large international enterprises and financial firms that are prime targets for the IBX service. Asia Pacific countries like Japan have become a growing focus of Equinix's expansion efforts. The data center provider also expanded its presence in Hong Kong, Shanghai and Singapore last May when it purchased Asia Tone. For more:
- see the release Related articles:
Equinix sells off 16 data centers to investment group for $75M
Equinix boosts Asia-Pac data center presence by acquiring Asia Tone for $230.5M
Synergy: IaaS and PaaS revenues rise 65% Read more about: Equinix
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NBN Co., the company building out Australia's National Broadband Network, on Friday said it met its construction goals, reaching a total of 784,592 premises by the end of 2012. The service provider said construction will commence when it issues contract instructions to its contractors for a Fibre Service Access Module (FSAM), a device that can serve between 2,000 to 3,000 premises. As it moves into 2013, NBN has signed deals with various construction companies for regions including Silcar, for New South Wales, Queensland and the Australian Capital Territory (ACT); Visionstream for Tasmania; Transfield for Victoria; and Syntheo for the Northern Territory, South Australia and Western Australia. In addition to single family homes, NBN has established partnerships with Downer EDI Limited and Universal Communications Group Limited to extend fiber-based services to multi-dwelling units (MDUs). As of the end of November 2012, NBN had connected 237 residential MDUs across Australia, with work begun on another 131. By the end of June, NBN has set a goal to reach 286,000 premises passed. Mike Quigley, CEO of NBN Co., said in a release that it now has the foundation "to reach the peak rollout target of passing over 6000 premises a day by 2015." The fiber-based portion of the NBN will reach 93 percent of Australian premises by 2021, with the remaining set to receive high-speed broadband via fixed-wireless or satellite by 2015. NBN has continued to make progress in attracting more competitive providers to use its network to provide services. In late November, Internode, which now operates as a subsidiary of iiNet, introduced a wireline voice service designed for Australia's fiber-based National Broadband Network (NBN) last November. For more:
- see the release Related articles:
iiNet ropes in 10,000 FTTH customers
Internode brings landline voice service to Australia's NBN
Cisco tapped by Australia NBN to be part of its data network
Telstra unveils suite of wholesale data services
Aussie commission OKs deal between NBN Co, Singtel Optus Read more about: Australia NBN, Broadband
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Alcatel-Lucent's (NYSE: ALU) struggling submarine cable business has caught the attention of France's sovereign fund FSI, which may make a bid on the unit. FSI, according to Reuters citing an article from Agefi that did not name sources, is just one of several parties that are interested in buying the cabling business. A sale of the unit could potentially generate from €600-€700 million ($800-$933 million) for the financially-strapped vendor. What's driven the government to considering purchasing the unit is the fear that the intellectual property assets Alcatel-Lucent put up as collateral could end up being owned by investors outside France. The vendor's union leaders have also encouraged the government to buy a large stake in the cable business. Another possible bidder on the unit is France Telecom. As reported by Los Echos in December, the government was trying to help the incumbent provider develop a deal to purchase the cable business. In its Q3 earnings announcement, the Paris-based company announced a €1.25 billion ($1.62 billion) restructuring program that includes selling off assets, including the cable and enterprise communications business, and cutting 5,500 jobs. Although Alcatel-Lucent has been signing new submarine cable network deals with the likes of new players like Seaborn Networks, the vendor said it was seeing overall weakness in the submarine cable market. Following a challenging Q3, the service provider secured €1.6 billion ($2.1 billion) in new funding from Goldman Sachs and Credit Suisse Group to finance its €1.25 billion ($1.6 billion) restructuring program. For more:
- Reuters has this article Related articles:
Alcatel-Lucent to use €1.6 billion in new financing to fund restructuring program
Alcatel-Lucent explores financing options with Goldman Sachs
Alcatel-Lucent realigns wireline and wireless units' leadership Read more about: Alcatel-Lucent, submarine cabling
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FairPoint Communications (Nasdaq: FRP) on Thursday forecast that its Ethernet Fiber to the Tower (FTTT) business in northern New England will grow by more than 39 percent this year. The telco has made significant progress with FTTT, having only entered the market segment in 2010. As of the end of last year, FairPoint reported that it had signed contracts to more than 950 mobile towers on its fiber-based backhaul network. This year, the telco said it will add over 1,300 new connection points on its network based on contracts with various major wireless operators. Since it could be serving more than one wireless operator at each tower, FairPoint will provide Ethernet Virtual Connections (EVCs). Although it would not reveal what wireless operators that have bought their wholesale service, FairPoint said it will expand its Ethernet-based backhaul services to over 1,000 towers by the end of the year in Maine, New Hampshire and Vermont. To date, FairPoint has invested over $200 million in Vantage Point, an IP/MPLS network that it uses for both its wholesale and retail business customers. Like other wholesale providers, FairPoint has been building out its fiber network accommodate new wireless radio technologies, including small cells. Although each wireless operator's small cell application varies, a recent Infonetics report said they will use a mix of both wireline-based fiber and copper from service providers like FairPoint in addition to licensed and unlicensed spectrum to support small cells. Michael Howard, Infonetics Research's co-founder and principal analyst for carrier networks, said that "a cumulative $5 billion to be spent worldwide on outdoor small cell backhaul equipment between 2012 and 2016" along with "the nearly $44 billion being spent on macrocell backhaul equipment during the same 5-year period." Regardless of the type of small cell configuration wireless operators use, wholesale and retail Ethernet services have been a growth engine for FairPoint. In Q3, the service segments collectively contributed about $10.7 million of revenue, up from $10.2 million in Q2 2012 and $4.2 million in Q3 2011. At that time, FairPoint forecast further growth in both retail and wholesale Ethernet as "regional banks, healthcare networks and wireless carriers transition away from legacy technologies like frame relay." For more:
- see the release Related articles:
FairPoint's next-generation services drive revenues to $242.1M
FairPoint to construct new E-911 system for state of Maine
FairPoint sells its Idaho operations to Blackfoot Telecom Group
FairPoint Communications to build New England Telehealth Consortium Network
FairPoint extends broadband to an additional 4,900 NH homes, businesses Read more about: FTTT, Fairpoint Communications
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Week in research: On-net IP VPN, Ethernet demand rises; home area networks ascend
Rob Shanahan on merging Lightower, Sidera's futures
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