CenturyLink, Cogent sign new interconnection agreement

CenturyLink (NYSE: CTL) has signed a new long-term bilateral interconnection agreement with Cogent Communications, marking the latest in a string of pacts made between the top telcos and Internet transit providers whose clients include content providers like Netflix (NASDAQ: NFLX).

As a bilateral agreement for their public IP networks, the service providers said in a statement that it "allows the exchange of Internet traffic in a balanced, scalable and mutually economical manner to accommodate the growing use of the Internet."

CenturyLink was one of the last large telcos that Cogent needed to gain a new interconnection agreement.

Cogent has been aggressively pursuing agreements with a number of incumbent telcos and cable operators since the net neutrality rules were passed at the end of February.

Besides CenturyLink, the service provider signed an interconnection agreement with Time Warner Cable. That agreement was a key win for Charter (NASDAQ: CHTR), which is in the midst of acquiring TWC. The interconnection deal with Cogent is one of the issues that the FCC was looking at when considering whether to approve the proposed $78.7 billion deal.

Earlier, the company signed deals with AT&T (NYSE: T) and Verizon (NYSE: VZ) with the goal of improving traffic exchange efficiency by adding more capacity and interconnection locations.

It appears that the agreements Cogent garnered with AT&T and Verizon are working.

Dave Schaeffer, CEO of Cogent, told investors at Deutsche Bank 23rd Annual Leveraged Finance Conference in October that AT&T and Verizon "are nearly congestion free and will be completely congestion free sometime in the fourth quarter."

Cogent is also making progress with international service providers, conducting negotiations with Orange, Telefonica, and Deutsche Telekom.

For more:
- see the release

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