Windstream has completed the $575 million sale of its data center business to TierPoint, enabling the telco to focus on enhancing its last mile and long-haul fiber network to deliver a host of new services to its existing and new consumer and enterprise customers.
Although the company will no longer operate data center assets, Windstream will continue to provide these services to its business customers.
The provider has established a reciprocal relationship allowing each company to sell its products and services to its respective customers.
"This transaction enables Windstream to focus capital on our core telecom offerings and pay down debt, while providing expanded data center services to our enterprise customers," said Tony Thomas, Windstream's president and CEO, in a release.
With the sale of its data center business behind them, Windstream will be able to focus on new core residential, business and wholesale service initiatives.
On the residential side, the service provider recently began the launch of its 1 Gbps FTTH service in Lexington, Ky. The service provider plans to launch the service in a total of five markets during the first half of 2016.
Besides FTTH, the service provider is enhancing its existing copper network infrastructure. In November it announced that it would expand the availability of 100 Mbps services using VDSL2 to over 800 markets, and Project Excel, a $250 million program that will accelerate further upgrades of broadband speeds in more markets.
For businesses and wholesale providers, Windstream has been building out new 500G optical routes in key markets like Miami and Denver, for example. More recently, it began offering optical wavelength optical services to enterprise customers that are asking demand for dedicated, high bandwidth data center connectivity solutions.
Windstream is hardly alone in its desire to shed its data center business. Fellow telco CenturyLink (NYSE: CTL), while not yet announcing a sale, has indicated that it is looking at options for its data center business, including a possible sale.
Seeing the challenges of running a data center, including the expense of operating them with space and power, these telcos have come to the realization that it would be better to offer such services through a third-party partner.
- see the release
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