Zayo says E-Rate dark fiber deals are picking up, but school district interest varies

Steinbach school

Zayo Group is taking advantage of the FCC’s move to incorporate dark fiber into the E-Rate program, signing up more school districts in its region over the past year.

Under the FCC's E-Rate order issued in 2015, the regulator amended the eligible services list to support the equal treatment of lit and dark fiber services. Local school districts are able to purchase either kind of service depending on their specific needs via a Form 470 application.

Dave Jones, EVP of dark fiber services for Zayo, told FierceTelecom that school districts’ adoption of dark fiber varies.

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“There’s a lot of new opportunities that are coming up as the ability to use dark fiber from the E-Rate program, but Iit depends on the school district,” said Jones. “Some of them are forward thinking and are really excited about it and others aren’t ready to go that route yet, but I expect to see more activity next year across the industry and for Zayo as well as the schools get more comfortable about how to approach it.”

Zayo’s E-Rate success was clearly seen in its fiscal fourth quarter where it won two contracts with school districts in Colorado and Texas, both of which leverage existing fiber to the tower builds that were completed for a large wireless carrier.

In Denver, Zayo will build a 618-mile dark fiber network with the Denver Public Schools (DPS), Colorado’s largest school district. The network will connect 153 schools and sites, including two DPS data centers. Similar to other E-Rate builds, Zayo said that 562 miles of the network is already in place or under construction, with 56 miles still to be built.

Building off a 122-site fiber to the tower (FTTT) build in Dallas, Zayo won a 1,178-mile Texas school district contract. The service provider will extend services to the area schools located in the Texas Education Service Center Region 11 via a fiber network build that's under construction in Dallas-Fort Worth for a major wireless operator. 

Jones said that being able to leverage a number of existing FTTT builds allows an easier path to prove a business case for further E-Rate deals.

“It’s really an ideal way to leverage a lot of the FTTT builds were doing, which blanket large metro areas and generally puts us in a reasonable distance of the schools in that area,” Jones said. “It gives a platform to leverage off of and provide a compelling price for them and improve the aggregate economics of the original FTTT deal in the market.

Related articles:
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Zayo appoints Level 3, Charter exec Tierney as EVP of network connectivity
Zayo’s Jones: We're 'doubling down' in existing dark fiber markets
Zayo says some customers want a managed dark fiber service
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