ExteNet chases indoor, rural fiber growth opportunities

ExteNet Systems has zeroed in on a growth opportunity in the indoor fiber market, aiming to capitalize on rising demand for bandwidth in venues and offices while it waits out a lull in wireless buildouts which use its outdoor optical infrastructure. That’s at least in part why it’s packing up its offices in Illinois and moving its headquarters to telecom territory in Texas, CEO Rich Coyle told Fierce.

Founded in 2002, ExteNet is a communications infrastructure provider which offers a mix of indoor and outdoor dark fiber and lit services. The majority (60%) of its business today is in the outdoor segment, through which it serves wireless carriers, enterprises and rural ISPs. But Coyle noted now that carriers have completed their first wave of C-Band spectrum deployments, its outdoor business has slowed. It’ll remain a bit sluggish until the next batch of C-Band airwaves become available for carrier use in late 2023, he said.

But it looks as though the indoor segment will keep it plenty busy in the interim.

“Our indoor business is probably our fastest growing aspect of our business and really where we see the big shift,” Coyle said. “In the near term, what I would say is we’re seeing minimal growth on the outdoor side, probably in the 10-15% [range] and we’re looking for the growth in the near term in the indoor business. We’re looking to grow our indoor business probably about 30% from where we are today.”

In terms of its indoor business, ExteNet is focused on serving enterprises and venues with robust fiber that can be used to deliver connectivity via DAS, Wi-Fi and cellular systems. Over the past few months, it has inked several notable deals to build out neutral host fiber for MGM Resorts in Las Vegas; the AT&T Center, home of the San Antonio Spurs, in Texas; and motorsports venue the Circuit of The Americas in Austin, Texas. It also previously signed indoor deals to build out Madison Square Garden, the Dallas Cowboys Stadium and the LA Forum.

Its work such locations generally includes ripping out each site’s existing network and replacing it with higher-count fiber, Coyle said. This transition allows not only the facility owners but also wireless carriers to set up and deliver services to enhance customers’ in-building experience.

Coyle said getting closer to such customers, as well as wireless carriers like AT&T and T-Mobile, is a driving factor behind its decision to shift its headquarters to a new 37,000 square-foot facility in Texas. The company indicated the move is expected to be complete by Q1 2023 and will create 110 new jobs in the city.

On the enterprise side of the indoor business, Coyle said demand for increased capacity in office buildings is “slowly starting to come back.” However, he noted ExteNet has seen some pricing pressure that is offsetting those gains to leave revenue flat on that front.

Rural frontiers

The CEO flagged fiber builds with rural ISPs as another potential opportunity for the company. While many today use fixed wireless and microwave backhaul technology, Coyle said rural ISPs are increasingly starting to see the need for fiber backhaul.

“We believe that with the infrastructure bill, that’s opened up a lot of opportunities for those customers now to look to build out or harden their networks via fiber,” he said, adding ExteNet could provide not only backhaul but also fiber-to-the-curb. “We see there is an opportunity. Obviously, it’s in the infantile stages of what goes into the infrastructure bill, but we are starting to talk to not only our customers but also starting to talk to the various states as to what they’re doing.”