Lightower sees cyclical demand for dark fiber from financial companies, schools

Lightower is happy to sell its carrier and businesses either dark or lit fiber services, but the service provider has found that in some customer verticals like financial the trend goes back and forth between both domains.

Dark fiber is a natural fit for financial customers, particularly trading firms, by reducing network latency to more effectively beat a competitor on a trade in a matter of a few seconds.

Philip Olivero, CTO of Lightower, told FierceTelecom that sometimes financial firms purchase the dark fiber and quickly realize that it might be easier to have their service provider manage the connections and maintenance of the fiber itself.

"Financial service companies' demand can warrant dark fiber, but they go a little back and forth, so it's cyclical," Olivero said.  "They go to dark fiber, they start buying their own equipment and I think they get a bit ahead of their skis and the pendulum starts to swing back to 'can you manage this thing for us again and manage lit services so they're a bit back and forth."

Although Lightower has a number of customers that can take on managing a dark fiber connection, Olivero added that it's not for the faint of heart.

"Financial services companies are very sophisticated and yet when they get into it that they have to buy the equipment, there's software upgrades, the card replacements, and having the NOC services available, there's a reason why carriers like us exist because we manage all of that," Olivero said. "Certainly there are some customers that can take on that responsibility, but it's not to be underestimated."

For customers that don't want to manage dark fiber, but want greater control over their connection Lightower also offers managed private optical network service.

Unlike a traditional lit service, Lightower will provide a dedicated fiber and network connection designed for a specific customer.

As part of this service, the service provider also offers specialized support services such as installing optical equipment at the customer premises and bandwidth management tools.

"We also offer a managed optical private network offering where we're still managing everything for the customer, but it's customized and dedicated to a given customers," Olivero said. "We'll actually sell them a DWDM box on their customer premises and the other nodes on their network while the fiber is dedicated to that customer."

Lightower says it sees growing demand for its managed optical service in the financial sector, which has very stringent requirements.

"In some cases with the financial services customers, we can sell them not only shared lit services on a shared DWDM backbone, but they want dedicated boxes customized to their specifications," Olivero said. "We see that sold as much in financial services as much as any other vertical."

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