Telecom Ramblings

Ok, a bit of the dust has settled on yesterday’s purchase announcement of PAETEC by Windstream, so let’s check the temperature out there:
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Zayo Group (news, filings) is expanding its presence in West Virginia, according to a press release this morning.    The supra-regional fiber operator is building out metro network in and around Fairmont, a city to the south of Morgantown.  The new network aims at bringing online the I-79 High Tech Corridor and I-79 Technology Park, home to many federal agency facilities such as [Read more →]

According to a report out this morning over at Telegeography, transpacific wavelength pricing pressure has been very substantial over the past twelve and twenty four months.  Between Q2 2009 and Q2 2011 the median monthly lease price for a 10G wave between LA and Tokyo has fallen from $98,500 to $36,000.  Pricing on other routes routes has fallen similarly, with twelve month declines of 33% and 39% for [Read more →]

The Windstream/PAETEC deal sort of pushed other news aside this morning, however other things did happen today that are definitely worthy of note: [Read more →]

This morning’s M&A announcement certainly caught me off guard – although perhaps it shouldn’t have -and I’m still trying to get my brain around it.  Windstream’s activity lately in targeting the business marketplace outside its ILEC territory has been very aggressive.  But until now geographically they were still very much a regional company even as a CLEC, just as the NuVox and KDL/Norlight footprints were.  Buying PAETEC takes what was already a rather radical hybrid [Read more →]

In a deal that came as a complete shock to me, Windstream (NYSE:WIN, news, filings) has agreed to purchase PAETEC (news, filings) in a deal worth $2.3B.  Windstream will assume or refinance PAETEC’s net debt of $1.4B and PAETEC shareholders will receive 0.460 shares of Windstream common stock for each PAETEC share they own.  That appears to peg the deal at about $5.61 per share based on Friday’s close, and if one guesses PAETEC’s current run-rate EBITDA at about $380M, the EV/EBITDA multiple of the deal would be in the neighborhood of [Read more →]

A short time ago, Dan Rayburn posted an article indicating that something big is about to happen over at Limelight Networks (NASDAQ:LLNW, news, filings) with the likeliest outcome being an acquisition by the likes of Verizon or perhaps MicroSoft.  Certainly such rumors have come and go regularly over the past few years, but Dan has rarely been wrong when he makes these calls.  So, let’s do a few quick takes on those potential acquirers and a few others: [Read more →]

European independent metro fiber operator euNetworks (news) isn’t messing around with its efforts to attack the German market.  Today they announced their second acquisition in three months with the purchase of TeraGate AG Storage Optical Network.  TeraGate offers nextgen corporate WAN solutions, including Ethernet products and cloud-based storage networks.  They operate both nationally and internationally, but their primary focus lies in Germany across seven [Read more →]

Zayo Group (news, filings) said yesterday that it has begun construction of a metro fiber ring in the central business district of Los Angeles that will provide data center connectivity for CoreSite (NYSE:COR, news, filings).  CoreSite has two existing data centers in Southern California totaling 600,000 square feet, with a third on the way that will add another 25,000 square feet of an eventual 145,000 when it opens later this quarter.   [Read more →]

NTT America (news) [a subsidiary of NTT Communications (NYSE:NTT, news, filings)] is taking a turn for the green at its Lundy data center in San Jose.  The international network and cloud provider is bringing in five Bloom Energy Servers as part of its overall energy conservation efforts.  The entire data center industry has been trying out all sorts of alternative energy ideas, and Bloom’s fuel cell technology is an interesting choice. [Read more →]

In their earnings report this morning, Earthlink (NASDAQ:ELNK, news, filings) said that with a full quarter of One Communications adding to their earlier purchase of Deltacom and of course their New Edge division, business services now add up to 74% of the company’s total revenue, which means we’re really going to have to start thinking of the company as a network operator and CLEC rather than an ISP.    I still don’t think their done assembling fiber and CLEC assets.  However [Read more →]

Finally ending one of the least-secret partnership negotiations of recent memory, Sprint Nextel (NYSE:S, news, filings) and upstart wholesale wireless network operator today announced a multi-billion dollar, fifteen year deal.  Sprint has been trying to put together a 4G strategy for years now, and perhaps adding this piece will finally let them finish the puzzle.  But LightSquared is still embroiled in regulatory issues surrounding its use of former satellite spectrum due to interference claims by the GPS industry, which will surely need to be resolved first. [Read more →]

The news is thick this week, let’s do a quick rundown of some items in the datacenter space both domestically and internationally: [Read more →]

The flagship of the carrier neutral colocation industry, Equinix (NASDAQ:EQIX, news, filings), posted its usual solid quarter today.  Revenues of $394.9 included $11.7M from the ALOG acquisition down in Brazil, but even excluding that still exceeded both guidance and analyst estimates.  Diluted earnings per share of $0.64 easily bested guidance of $0.48.  Here is a quick tabular summary of Equinix’s Q2 in the context of the past few quarters: [Read more →]

The content delivery, or should I say cloud optimization provider Akamai (NASDAQ:AKAM, news, filings) reported its second quarter results, hitting guidance right on the nose, and probably not surprising anyone.  The company’s Q2 forecasts weren’t enthusiastically received back in April, but obviously it’s better to be right than to make traders happy.  Here is a quick summary of their numbers in the context of the last few quarters: [Read more →]

While the quarter’s big announcement was obviously the Level 3 deal which will close later this year, the main priority in the meantime the number one priority of Level 3 Communications (NYSE:LVLT, news, filings) was proving their organic growth trend has legs, and improving legs at that.  Their second quarter results show exactly that, slightly exceeding both analyst estimates and my own for core network services growth.  Here are their numbers in context: [Read more →]

International IP solutions provider glbc found itself some substantial growth in the second quarter.  Revenues advanced in all three of their geographical segments, partly buoyed by $9M in termination revenues and some favorable currency fluctuations.  Backing those out, they seem to have met or slightly beat market estimates (and my own) for invest and grow revenues.  Here’s a quick summary of the company’s performance in context: [Read more →]

For Juniper Networks (NASDAQ:JNPR, news, filings), the second quarter apparently had more than the usual crop of speed bumps.  In the list of things one doesn’t generally want to read in an earnings release, Juniper saw ‘mixed signals from the macro economy’, ‘moderation in certain areas of the business’, and responded by taking ‘decisive steps to ensure our cost structure takes into account the near-term revenue environment’.  Here’s a quick rundown of their numbers on context. [Read more →]

Lots of earnings news coming over the next two days, so before we are inundated with revenues and EBITDA, here are a few snapshots of other interesting news that has crossed the wires recently: [Read more →]

I’ve written many times about the future of XO Holdings (news, filings) and how the presence of majority owner Carl Icahn has warped the company to the detriment of both employees and shareholders, but it’s always from an abstract strategic point of view.  But recent emails uncovered in the discovery process in one of several lawsuits by minority shareholders and included in the revised complaint have painted his meddling in the company in sharp relief.  Here’s former CEO Carl Grivner’s email response to a fellow board member’s proposal to incentivize XO management with stock options in August 2008 (emphasis added): [Read more →]

Level 3 and Global Crossing both report earnings on Wednesday morning, which of course is not a coincidence given their pending combination later this year.  Here’s a quick preview of what to expect, or at least what I expect. [Read more →]

I’ve noted a few times Integra Telecom’s increased focus on fiber connectivity as opposed to its more traditional CLEC business, but as a private company we don’t get to see many actual data points along the way.  Today though, the company revealed the extent of that acceleration by announcing that it has increased its on-net building count by 300 since the beginning of the year, giving them more than [Read more →]

The East African submarine cable system SEACOM has added some terrestrial fiber down in South Africa, investing R100M in dark fiber from Dark Fiber Africa as well as the equipment to light it.  The fiber will hook up the cable’s landing station on KwaZulu Natal’s coast with two redundant PoPs in Gauteng.  Gauteng is not a household name, but it’s two main cities of [Read more →]