I spent the last few days at Metro Connect wearing out both my ears and my voice. It's always a great event, where the metro fiber industry's leaders get together and talk straight both in private and in public. Some of the northeastern contingent had its flights canceled by the snow, but it was very well attended nonetheless. Here are a few things I took away from Miami -- there are probably more, but they are still ricocheting around in my skull.
New kid in town: Last year the cable companies finally arrived in force, but this year the new kid in town was a tower company. After buying 24/7 MidAtlantic in 2014, Crown Castle itself came to Metro Connect to talk about wireless backhaul networks and small cells, and people were listening carefully. Dan Caruso's keynote comparing the pros and cons of the metro fiber business to the tower business, using a batman to superman analogy, was therefore quite topical.
Small Cells: These were definitely a hot topic across a wide range of providers, although mostly still in the context of defining terms and markets. This is still obviously a rapidly evolving concept, and along with the general optimism of a new market opportunity there remains a substantial undercurrent of wariness about the business models. There are definitely still a lot of unresolved issues out there, and some impatience too.
Acquisition rumors: Windstream to buy Lightower? That rumor was definitely rumbling, but I'd be shocked if it was more than talk. Even if the network REIT were ready to rumble, which isn't quite yet, I have a hard time imagining Windstream paying the sort of multiple it would have to pay to buy Lightower from its private equity backers at present.
But I got the strong feeling that overall the metro fiber consolidation game was in flux, with several potential deals bubbling just under the surface. Level 3 and XO? I haven't thought about Icahn in a while, and I dare not speculate now after so many false starts over the years. Zayo and [anybody]? Well, obviously! But perhaps what we might see is some of the PE guys pool their regional fiber plays and try to assemble another national operator alongside Zayo, as some of those guys were acting decidedly chummy.
No place like New York: We may have been in Miami, but the Big Apple had an outsized profile. In recent months, two new entries (Axiom and ZenFI) started pulling fiber in Manhattan with very different approaches and plenty of local knowledge, and each was in Miami to make its case. Given that they are joining the likes of OCG and of course Verizon, Level 3, Zayo, TWC, Lightower, Lightpath and the rest, it's looking like a rather dynamic couple of years are ahead for NYC metro fiber.
And I also greatly enjoyed my second trip to Bank Street's exclusive dinner, complete with the skull and all that, courtesy of James Henry. James contributes great stuff here on Ramblings now and then, perhaps we'll manage to wheedle another article out of him this spring...
Were you at Metro Connect this week? If so, what did you take away from it? Leave a comment below!
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