Zayo Picks Up Stimulus Funding

February 18th, 2010 by · 3 Comments

Competitive metro and regional fiber operator Zayo has won some broadband stimulus funding in Indiana.  They are partnering with I-Light, which operates educational networks in the state from GRNOC at Indiana University, and will be building fiber connections to 21 Ivy Tech Community Colleges around the state.  Along the paths to those community colleges, they will also bring broadband connectivity to some 80 under-served communities.

It is billed as a three year project with total costs of $31.8M, of which about $25.1M will come from the government and the remainder will be made up of matching funds from Zayo and its educational partners.  Zayo and I-Light will be building 626 miles of new 96 strand fiber routes across the state.  Two of those fiber strands will be devoted to I-Light.  Zayo already has quite a bit of fiber in the state of course, having bought Indiana Fiberworks early in its acquisition streak.

There may have been others I missed, but this is the first stimulus win I have noticed that went to any of the companies I cover most frequently on Telecom Ramblings.  Zayo’s win shows the savvy with which they approached the process, finding an educational partner in a region where they have solid assets but desire additional depth.  When complete, Zayo will be sitting in a pile of unique fiber routes.

In the next stage supposedly more focus will be paid to the middle mile, which will perhaps favor these companies over the smaller rural community projects that have dominated so far.

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Categories: Government Regulations · Metro fiber

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3 Comments So Far

  • anon says:

    Rob, I enjoy your blog and perspective but can’t agree that there is anything “savvy” or otherwise to like here. A venture backed, for profit company is aking Public money, in the middle of a bad recession/depression for its Private gain (contrast with google, investing their own money). The Zayo guys should be embarrased to so deeply mooch off the state.

    It makes little sense to me that with a 15-20% cost of capital (or higher) that these guys keep buying “assets” with low ROIC… where is the value creation? anyone can spend a dollar of “OPM” to gain .05 cents of income… who cares?? worse yet, the strategy “splatter” of local vs long haul, metro vs rural, now colo (and legcy circuits meet me revs), etc., strikes me as the best evidence yet that this company is solely a financial construct built to be sold (perhaps partially to the public) but which is not creating any organic or other sustainable value…

  • tea party telco says:

    it’s like a fiber bridge to nowhere !!

  • Rob Powell says:

    Well, we can’t all agree all the time now can we?

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