EarthLink says unique fiber routes will set its wholesale business apart

dark fiber
The carrier segment has been a growing business for EarthLink.

EarthLink may be in the process of being acquired by Windstream, but the service provider says its wholesale division will differentiate itself from competitors by offering diverse routes other carriers don’t have today.

When the two service providers finalize their deal early next year, EarthLink will bring 29,000 route miles, 16,000 of which expand Windstream’s footprint, bringing its total to 145,000 route miles.

These routes are strategically located in the Southeast and Northeast U.S. and are unique fiber routes that Windstream said are synergistic with its current network.

Louis Alterman, EVP and CFO of EarthLink, told investors during the Bank of America Merrill Lynch 2016 Leveraged Finance Conference that the routes it gained from an earlier acquisition of ITC Deltacom did not traverse the same paths as other providers, so it will bring that advantage to the Windstream table.

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“Deltacom’s fiber in the Southeast was constructed on power company rights of ways and hung aerially where a lot of other fiber was on railroad right of ways and buried,” Alterman said. “What it created for us, and wasn’t understood at the time it was constructed, is we would have unique routes that would get you from point A to point B in a physically diverse way.”

While EarthLink can provide direct routes to key internet peering points in Ashburn, Virginia, the service provider also has what’s known as the Beach route between Raleigh, North Carolina and Savannah, Georgia.

“If you want to move traffic and don’t want it to go down when a big pipe gets cut that Level 3 and everyone else is on, that’s is an attractive route and you’ll pay prices that won’t look like commoditized prices,” Alterman said. “We figured that out and focused the sales force on leveraging that.”

Alterman added that besides selling to carriers, EarthLink has asked the sales team to sell wholesale services to “enterprises, social media companies and other companies that consume a lot of bandwidth.”

The carrier segment has been a growing business for EarthLink, a trend that continued into the third quarter. EarthLink’s carrier transport revenue was $35.6 million, up 1.4% sequentially from $35.1 million in the second quarter.

EarthLink said the carrier transport results “remain high as we've signed new customers to transport service on our fiber footprint,” while taking “our first orders for wholesale nationwide internet service.”