While it's still no giant, Atlantic Broadband is getting too big to fly under the radar anymore. The one-time cable overbuilder took another key step in that direction late last week when it swung a deal to scoop up the entire South Florida fiber network of FiberLight for just over $50 million, fueling its business services drive.
Now, upon the expected closing of the deal with FiberLight LLC in about six months, Atlantic Broadband will add roughly 350 route miles to its existing South Florida fiber footprint, more than doubling its fiber presence in the region. Even more immediately, the cable provider will gain access to an abundance of dark fiber capacity that it can use to start serving more larger enterprises and carriers in the growing commercial corridor running up the Atlantic coast from downtown Miami to North Palm Beach.
In an interview with Broadband World News, Atlantic Broadband President & Chief Revenue Officer David Isenberg said the cableco plans to use the new fiber lines and dark fiber to bulk up its presence in the South Florida business services market. He noted that there are firms and organizations with more than 10 employees collectively spending more than $30 million a year on data communications located within a mile of the fiber network it's buying from FiberLight. While that might seem like small potatoes to a giant MSO like Comcast Corp. (Nasdaq: CMCSA, CMCSK) or Charter Communications Inc. , it represents a golden opportunity for a player like Atlantic Broadband, which generated about $70 million in revenue from business services last year, or about 10% of its overall revenue.
"It really is a significant expansion of the [commercial services] opportunity for us," Isenberg said. "It's really all about putting more muscle behind the fastest growing part of our business."
In particular, Atlantic Broadband is looking to build up its share of the enterprise market, where it's now seeing the strongest growth. Although enterprises account for less than half of the provider's business services haul today, that market segment is growing twice as fast as the small-to-medium-sized (SMB) segment, according to Isenberg.
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Prospective targets include many of the usual suspects -- healthcare companies, government agencies, schools and professional services firms. But the list of prospects also includes some businesses more unique to the Miami market, such as major TV network production facilities and large data centers.
Of course, it won't be easy for Atlantic Broadband to make a big impact in a commercial market dominated by such cable and telecom heavyweights as Comcast and AT&T Inc. (NYSE: T). But Isenberg thinks the new fiber network may give his company a heads-up in the route that it covers.
"It's a highly competitive market; all the major telecom brands are there," he acknowledged. "But the [FiberLight] network goes a lot of great locations those other networks may not go."
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