abvt made good on its promise of expansion overseas and announced this morning that it will open for business in the major markets of Western Europe. They have long had a substantial metro fiber presence in London of course, but until now had been content with that single foothold across the Atlantic. By the end of the year they will have expanded their network into Paris, Amsterdam, and Frankfurt, aiming at web-centric businesses, financial services organizations and enterprises with a multinational presence.
AboveNet’s European presence will expand initially to some 30 key data centers, a number which probably includes a bunch they already had in London. The four markets are interconnected with a DWDM longhaul network capable of 3.5Tbps, which means they must have leased and lit a fair amount of dark fiber rather than simply slapping together a few wavelengths. Transatlantic capacity is also being added to support the expansion of course.
What isn’t clear yet is the extent of AboveNet’s initial metro presence in the three new markets, or for that matter Miami and Denver which they expanded to over the summer. They haven’t yet added maps to their website covering their expansion, an oversight I hope they will rectify soon! Obviously though from an asset perspective they will have necessarily started small.
All these new markets are clearly where the extra capex the company said it would be spending in the second half will be going, as they invest in a platform for future growth. That spending plan seems to have spooked some investors in the short term, which has kept down the company’s valuation. Next year’s growth forecasts will be key.