Possible ISP merger could be a North Carolina broadband boon – Carolina Journal


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As the federal government – and North Carolina rulers – seek to spend millions of taxpayer dollars on broadband growth, a possible merger between two strong-state ISPs could facilitate the development of broadband infrastructure.

Zayou Group LLC of Boulder, Colorado is looking to buy the Little Rock, Arkansas companies of Windstream Holdings and Uniti Group, Inc., according to The Wall Street Journal. Talks began in June, the newspaper said, but little progress has been made recently on the possible $ 3.5 billion acquisition.

Arkansas Online Noted that Uniti was once part of Windstream, turning into a separate company in 2015. Uniti primarily engages in the purchase and construction of infrastructure for the communications industry, and Windstream paid Uniti to access a part of this infrastructure, depending on the point of sale.

WSJ reported that Zayo owners believe the Windstream and Uniti merger could speed up construction of broadband infrastructure for one million more homes by redirecting the $ 700 million Windstream spends on rents each year.

The two companies were not without quarrels. Arkansas Online reported that Windstream sued Uniti in 2020, a year after breaking out of a voluntary Chapter 11 bankruptcy filing, alleging that the lease it had with Uniti was too expensive and financially burdensome. The companies settled in and agreed to a new long-term rental agreement.

Uniti has been quiet about the possible acquisition, but Windstream has commented on the possible benefits of such a deal.

“Without commenting on any specific potential transactions, any plan that will allow us to accelerate and deepen our fiber construction will be positive for Windstream and its customers,” said Tony Thomas, President and CEO of Windstream. Arkansas Online.

Windstream spokesperson Scott Morris said Caroline’s Diary Kinect by Windstream, the business arm of Windstream Holdings that serves residents and businesses in 43 predominantly rural communities across the state, deploy fiber to an additional 39,000 sites in North Carolina by the end of 2022 with a investment of $ 15 million. Additional fiber is expected from 2023 to 2025, but plans have not been finalized, Morris said.

Windstream will also use money from the Federal Communication Commission’s Rural Digital Opportunity Fund to serve another 2,000 sites in the years to come. It will cost around $ 8 million, with half the funding coming from taxpayers and the other half from Windstream. Similar steps are being taken across the country, as the FCC works with private providers to help bridge the digital divide.

“We collectively have a unique opportunity to build fiber optic broadband networks in the most expensive areas that are not or underserved, and it is important that we move forward quickly,” Morris said.

“Without public-private partnerships in which governments and private companies share the costs of deployment, broadband networks simply will not be built in rural areas where there is no economically viable business case to support the ‘private capital investment,’ he added.

This potential unification of Windstream and Uniti comes as the state budget allocates more than $ 700 million in federal and state taxpayer money to facilitate broadband expansion.

Jordan Roberts, government affairs associate for the John Locke Foundation, told CJ that finding innovative methods to increase access to broadband internet is essential for the future growth of the state.

“We have seen a lot of investment and action from public sources, but the case of Uniti and Windstream proves that there is a strong private market for broadband expansion,” he said. he declares. “Governments need to ensure that their investments or policies in favor of broadband do not hamper the progress of companies like these that operate in our backyard. ”

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