Zayo wins Denver school system dark fiber contract

exterior of school building

Zayo Group has won a contract to build out a 618-mile dark fiber network with the Denver Public Schools (DPS), Colorado’s largest school district.

Upon completion, 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.

The fiber network will serve over 100,000 students and educators will use the higher bandwidth for digital textbooks and tools, online standardized testing, streaming media and online resources and apps that are critical for the K-12 curriculum.

DPS is funding the fiber upgrade through the FCC’s E-Rate program that subsidizes network infrastructure so schools and libraries can provide high-speed internet services. This is the first year that the FCC has included dark fiber in the E-Rate program, giving DPS full network control and the ability to add capacity as needed.

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

Education is one among many growing segments for Zayo’s fiber services business. To date, the service provider has won 30 E-Rate-funded solutions in Colorado alone and has other projects underway in multiple states, including Georgia, California, Arizona, Idaho and Indiana.

Zayo’s latest E-Rate fiber win is gaining the attention from the financial analyst community, which sees this deal and others being won by competitors like Lightower as a growing trend for fiber-centric providers.

“We continue to believe the education silo will be an important one for fiber providers,” said Jennifer Fritzsche, a senior analyst for Wells Fargo, in a research report.

What’s interesting about Zayo’s E-Rate wins is that many of them often leverage existing fiber builds, particularly those that are slated for fiber to the tower (FTTT) projects.

One market where it has seen this trend is in North-Central Texas. 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. This 1,178-mile platform consists of 440 miles of previously planned FTTT build, 443 miles of existing network and 295 miles of new construction. 

However, Zayo is hardly alone in winning E-Rate dark fiber wins. Other competitive providers, including Fatbeam and Lightower continue ink E-Rate deals for lit and dark fiber.

Fatbeam, which serves the Pacific Northwest region, recently won 11 new E-Rate service contracts in four states. Specifically, Fatbeam will provide a series of lit and dark fiber services to school districts in Washington, Oregon, Idaho and Montana. While local schools will be the first to gain access to a new 200-mile fiber network, Fatbeam will extend that network to address a host of local business and wholesale opportunities with wireless operators.

No less aggressive is Lightower. Citing an entry in the NYC vendor and contract website checkbooknyc, Wells Fargo reported that Lightower won a $176 million contract with the Department of Education in NYC this spring.

“Since this deal was inked, our channel checks would suggest Lightower has been able to secure more incremental business from charter schools, other enterprises and wireless carriers around this building in all 5 NYC boroughs,” said Fritzsche. “We expect ZAYO will see a similar trend.”

Lightower set a new path for further E-Rate wins by completing a network expansion in New York City throughout Staten Island. A unique feature of the New York City expansion is that it creates a shorter path around Manhattan from New Jersey to points north and east of New York, which is ideal for businesses that want to reduce latency along this route or those needing geographic diversity.

For more:
- see the release

Related articles:
Zayo brings dark fiber to north-central Texas schools, leverages existing FTTT investment
Zayo sees dark fiber dollars in content providers, data centers, and school districts
Fatbeam wins 11 new E-Rate contracts, builds 200 fiber miles to address wireless backhaul needs