Shentel may not be the size of its larger ILEC compatriots, but the service provider is being no less aggressive in pursuing dark fiber deals with school districts and wireless operators in its largely rural territory.
What’s helping Shentel get the attention of wholesale and retail customers is a fiber network that currently consists of nearly 5,000 route miles of fiber throughout Virginia, West Virginia and parts of Maryland.
Ed McKay, SVP of engineering and planning for Shentel, told FierceTelecom that the fiber network is being used to satisfy external and internal needs.
One of those needs is being able to backhaul traffic on its growing wireless network. The telco has built fiber to over 240 of its own cell sites and it has 60 more in construction.
“We’re using it to not only go after fiber customers, but also to reduce our operational costs,” McKay said. “We’re interconnecting our cable networks and providing backhaul to our own cell sites.”
Having purchased NTELOS’ wireless network earlier this year, the service provider will expand its wireless network even further.
“With our recent acquisition of NTELOS Wireless there’s going to be additional opportunity to bring cell sites onto our fiber backbone,” McKay said. “NTELOS Wireless network overlaps our fiber network very well so there’s a lot of opportunity there.”
Besides serving its growing wireless network, the service provider also sells fiber-based solutions to a number of major wireless operators.
“We’re selling fiber services to the top 5 wireless carriers either directly or through partnerships with other wholesale carriers so we’re leveraging the fiber there,” McKay said. “As we build out for our own operating cost savings we’re also bringing in new revenue as well.”
Similar to other wholesale providers, McKay said Shentel is getting more requests from its wireless operator customers for dark fiber.
“We’re doing both lit and dark fiber,” McKay said. “We’re seeing more interest in dark fiber and even from the wireless carriers we’re seeing interest in dark fiber.”
Additionally, the service provider is seeing growing opportunities to serve local school districts and rural hospitals.
Craig Venable, director of fiber sales for Shentel, said demand for dark fiber has continued to rise in just the past year.
“Requests for dark fiber from the education and health care vertical markets are up,” Venable said. “We’re certainly seeing the demand pick up from those particular categories and based on conversations with our customers we expect that to continue.”
In Virginia and West Virginia, Shentel currently has contracts with over 16 school systems that have awarded the telco contracts to build out fiber to their facilities. The telco had another 12 that it is talking to for similar deals.
Outside of Virginia, Venable noted that Shentel sees opportunities to win new contracts in Pennsylvania, a market it entered into through a fiber expansion project it launched in February serving parts of four states.
Areas in its wireline footprint that are benefitting from this latest expansion are Cumberland, Maryland and Morgantown in West Virginia, along with Carlisle, Harrisburg, Hershey, Waynesboro and York, in Pennsylvania.
Along this network route, Shentel is putting in high count fiber with 144 and 288 count fiber to address a host of service opportunities.
“We have not been able to leverage that expertise where we built in Pennsylvania,” Venable said. “We see a lot of opportunity once we get entrenched in that market.”
One of the byproducts of Shentel’s E-Rate builds is that the telco can also address rural health care clinics.
“As we’re doing these things and leveraging our network, we’re being careful about planning out those routes,” Venable said. “We make sure we pass the rural health clinics for telemedicine or other facilities that you would not build out to for a specific purpose, but by leveraging other builds we can get there in a cost effective manner.”
Evidence of Shentel’s success in growing its fiber business was seen in the second quarter.
Shentel’s wireline segment continues find success in selling fiber-based services and deepening relationships with local school districts and colleges. During the second quarter, Shentel’s Carrier access and fiber revenue for the quarter was $12.3 million, an increase from $2.1 million for the same quarter last year due to signing new fiber contracts.
Gains in carrier access and fiber helped drive up Shentel’s wireline segment revenue 12.9 percent to $18.6 million, up from $16.5 million in the second quarter of 2015.
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