Cable MSO giant Comcast (NASDAQ:CMCSA, news, filings) is apparently buying Cimco Communications, a Chicago area CLEC that serves 2300 small and medium sized business customers. Chicago is Comcast territory of course, and this purchase is clearly intended to give them a broader footprint amongst those customers. This acquisition strikes me as a scouting foray. After integrating a CLEC with an MSO on a relatively small scale in a single market, Comcast may see a path forward toward larger acquisitions across their footprint.
Comcast’s intentions in the business market have always been a bit of a puzzle to me. While small relative to Comcast’s residential business, the business services division did $198M in revenue last year. It’s a substantial business yet one which I don’t have much data for on my metro fiber list and on-net buildings list. Most of their customer base are the smallest businesses, those with 2-20 people, and Comcast serves them with its usual hybrid fiber/coax infrastructure. Cimco’s customers are generally in the next tier of 20-50 people. Larger companies are more likely to need direct fiber access, so I wonder if Comcast intends to pull fiber to bring these guys on-net.
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