Windstream Joins Chase for Stimulus Funding

The first round of stimulus funding went mostly to local communities and smaller regional providers and for projects usually in the tens of millions of dollars.  But the second round is shaping up rather differently, as the larger ILECs arrive with bids an order of magnitude higher.  Last week it was q reversing course and applying for a big chunk.  Today it was the large, mostly rural ILEC Windstream (NYSE:WIN, news, filings) who turned up with their own rather large bid.

Windstream’s stimulus bid is for a $318M project, of which it will supply $80M.  Unsurprisingly, the money will go toward extending the company’s broadband footprint into a variety of communities in its footprint it has not been economical to reach thus far.  If successful, the buildout would make 6-12Mbps broadband available to 500K homes and 80K businesses for whom Windstream is the incumbent provider but for whom DSL has not been available.  That will bring their broadband coverage to 93% of the population within their territory.  Oh, and Windstream will wind up with 7,000 more miles of fiber – a nice unique, long term asset.

Once again, I suspect this bid will get funded if only because it presents a nice package to the FCC of additional coverage to underserved areas that is large enough to impact the overall numbers.  It’s much easier to do it in larger chunks than a myriad of smaller ones.  It will also bring another ILEC into better alignment with the government’s orbit as it begins the push for the national broadband plan.

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Categories: Government Regulations · ILECs, PTTs