AT&T and BlackRock Alternatives (BlackRock), through a fund managed by its diversified infrastructure business, have signed a definitive agreement to form a joint venture that will operate a commercial fibre platform. The newly formed joint venture Gigapower, LLC., expects to provide a fibre network to internet service providers (ISPs) and other businesses across the United States.
Gigapower will serve customers outside of AT&T’s traditional 21-state wireline service footprint with fibre access technologies in innovative and efficient ways. And AT&T will leverage its nationwide wireless sales capabilities to sell fibre to customers in Gigapower territories.
“Now more than ever, people are recognising that connecting changes everything,” says John Stankey, CEO of AT&T. “With this joint venture, more customers and communities outside of our traditional service areas will receive the social and economic benefits of the world’s most durable and capable technology to access all the internet has to offer.”
“We are excited to form the Gigapower joint venture in partnership with AT&T, which will be serving as not only a joint owner but also the first wholesale tenant. We believe Gigapower’s fibre infrastructure designed as a commercial open access platform will more efficiently connect communities across the United States with critical broadband services,” says Mark Florian, global head of diversified infrastructure, BlackRock. “We look forward to partnering with Gigapower’s highly experienced management team to support the company’s fibre deployment plans and shared infrastructure business model.”
Gigapower plans to deploy a reliable, multi-gig fibre network to an initial 1.5 million customer locations across the nation using a commercial open access platform. The Gigapower fibre deployment will be incremental to AT&T’s existing target of 30 million-plus fibre locations, including business locations, by the end of 2025. Combined with existing efforts within AT&T’s 21-state footprint, this capital efficient network deployment will advance efforts to bridge the digital divide, ultimately helping to provide the fast and highly secure internet people need. This network expansion will also help spur local economies in each of the communities in which Gigapower operates.
“Fibre is the lifeblood of digital commerce,” says Bill Hogg, CEO of Gigapower. “We have a proven team of professionals building this scalable, commercial open access wireline fibre network. Our goal is to help local service providers provide fibre connectivity, create the communications infrastructure needed to power the next generation of services and bring multi-gig capabilities to help close the gap for those who currently are without multi-gig service.”
Following close, AT&T and BlackRock will jointly own and govern Gigapower. AT&T does not expect to consolidate Gigapower’s financial results but does expect to report its consumer subscribers served through Gigapower in Consumer Wireline business unit operational results. Any impacts to AT&T’s 2023 capital investment or free cash flow forecast will be included in AT&T’s 2023 financial guidance when it announces fourth-quarter 2022 results in January 2023.
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