Zayo has secured a new dark fiber anchor contract with an unnamed large content provider along its planned Phoenix to Dallas fiber route, illustrating a growing thirst for fiber solutions from various vertical segments.
Connecting Phoenix and Tucson, Ariz., El Paso, Texas, and Dallas, Zayo said the sale creates a positive unlevered return on the expected net capital investment and a positive cash flow yield since the initial anchor customer sale in early 2015.
Upon completion in late 2017 the Phoenix to Dallas route will provide customers with a continuous ring between Denver, Dallas, Phoenix, Los Angeles, the San Francisco Bay Area and Salt Lake City. It also will provide two potential routes from the Southwest to Chicago.
Gaining an additional anchor customer on this yet-to-be-built route is important to Zayo as it puts it on a path to not only getting a return on its investment, but also potentially attracting other clients that have an interest in this route.
Dave Jones, EVP of Dark Fiber Solutions at Zayo, said in a release that the company has seen strong demand in long haul and metro dark fiber from a number of its customer segments, including carriers, content, cable, retail, financial and health care companies.
Jones said that besides gaining the new follow-on customer sale, the "route has generated a robust funnel of other sales opportunities that further support our investment in the Phoenix to Dallas route."
Fiber expansion continues to be a common theme for Zayo, with the Phoenix to Dallas route being just one of several Zayo has in store for its customers.
It is also working on a number of other intercity fiber construction projects, including routes connecting Sacramento to Salt Lake City, Washington, D.C., to Atlanta and Omaha, Neb., to Dallas. Additionally, it also began the expansion of its Atlanta fiber network by more than 1,000 miles to provide FTTT service to over 500 towers.
- see the release
Zayo expands Atlanta FTTT footprint, satisfies 500-site deal for Tier 1 operator
Zayo acquires Allstream for $348M, gains instant Canadian fiber presence
Zayo says wireless carriers' small cell, C-RAN initiatives drive dark fiber deals
Zayo extends fiber, turnkey services to 1,200 wireless small cell sites
Zayo's Las Vegas data center gains another 10K square feet as customer