FairPoint: Growing demand for small cells prompted launch of construction business

FairPoint says its new line of construction services was driven by the growing demand from its wireless wholesale customers' ongoing small cell buildouts.

The carrier's timing to provide construction services that can accommodate small cell build outs could not be better.

According to a recent Markets and Markets study, the global small cell market is forecast to grow from $1.06 Billion in 2015 to $3.92 Billion by 2020, at a Compound Annual Growth Rate (CAGR) of 29 percent during the forecast period.

"We kept talking about 'small cell is coming' and 'the carriers are figuring out what their strategy is.' [It] really drove us to launch this," said Chris Alberding, VP of product management for FairPoint, in an interview with FierceInstaller. "When I think about small cell customers and their challenges it's a big box to manage because there's a lot of elements to it, including mounting the radio to the pole, fiber construction, project management and where equipment is going to be mounted for CRAN or BBU."

Given the complexity of handling small cells, wireless operators have the option to have FairPoint be a part or all of the network deployment.

Alberding says it's a mix of how much they want the carrier to handle for them.

"Depending on the carrier some have asked for turnkey solution, some will look for a turnkey solution. They will negotiate elements to manage themselves and we're flexible," Alberding said. "We're not making it a fixed package that's all or nothing, but the more we can do for you the better. And if you choose you want to use another third party where you have an established relationship for one element of the project, you're more than welcome."

While he could not reveal specific customers, Alberding said that a number of them are taking various parts of its Construction Services line.

"The result of what you are seeing today is the culmination of work that's been going on for the past six to eight months, and we have a number of customers that are taking various levels of this service," Alberding said. "The real key, as we work with some key customers to drive this, is to get the message out there to our key customer base at the upcoming COMPTEL trade show."

FairPoint may have only now made its construction services a formal product, but it is something the company has plenty of experience in delivering to wholesale customers. Having these services on hand will also enable it to gain new revenues to offset declines in traditional voice services.

The service provider's Construction Solutions for wholesale customers can accommodate a host of wireline and wireless projects, including small cell construction and custom cellular locations, structured cabling and inside wiring, construction project management and custom-built network solutions.

FairPoint can act as a single project manager that can handle all deliverables and vendors for a wholesale customer that needs to extend a new demarcation point, a new fiber design build, or a site survey.

Providing turnkey services for wholesale customers is a natural extension of FairPoint's wholesale service line, particularly in the wireless backhaul market.

With its new Construction Services, FairPoint can deliver a set of turnkey small cell solutions, including macro tower site preparations and small cell C-RAN site builds. It can also provide a series of complementary services such as pole attachment and licensing, fiber construction, custom BBU locations, connectivity and ongoing maintenance of small cells.

Over the past four years, the service provider has completed over 1,100 fiber-to-the-tower macro tower build outs in its Northern New England service territory.

Completing those builds has enabled it to enhance its IP-based Ethernet revenues, a factor that continued into the second quarter.

During that period, Ethernet contributed nearly $23.5 million of revenue, or 11 percent of total revenue, up from $20.9 million, or 9.3 percent of total revenue, a year ago, as retail and wholesale Ethernet circuits grew 28 percent year-over-year. FairPoint expects growth in its Ethernet products to continue based on demand from customers like regional banks, healthcare networks and wireless carriers.

Whether it's a large cell site build or a premise wiring project, FairPoint is also offering a set of Construction Project Management and Custom-Built Network Solutions to help wholesale customers plan and maintain their network connection, while offering hut permanent and temporary shelters, and more.

But wireless backhaul is only one part of its new Construction Services solution set. The service provider will also support structured cabling and inside wiring to accommodate a wholesale customer's installation for new or existing networks, user installs, campus wiring or wiring to support wireless access points. It can support wireless network upgrades at existing FairPoint wireless access points or help a wholesale customer create new wireless access points.

"It could be building demarcation extensions, cabling across buildings for other wholesale customers that may not have that presence in market to do that or would prefer to have it under a single umbrella," Alberding said. "We have got the expertise and the resources all across the footprint and a long lineage for doing projects for our own customers or one-off projects for wholesale customers."

FairPoint's Construction Services is part of what has become a growing trend in the wholesale services industry as a way to provide a level of differentiation beyond just offering last mile pipes.

Joining FairPoint in the turnkey services trend is a growing group of traditional ILECs like Cincinnati Bell and competitive providers like UPN, Tower Cloud and Zayo, which are capitalizing on the wireless and wireline industry segments' desire for services that help them either fulfill a wireless network build or addressing an off-net circuit deployment for a large business customer.

For more:
- see the release

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