Verizon Communications is adding more fiber to its portfolio with the purchase of WideOpenWest’s (WOW) fiber assets in Chicago. The company paid $225 million for the network with an additional $50 million slated for WOW to complete the Chicago network in the second-half of 2018.
The company said the WOW Chicago network will provide fiber connectivity for more than 500 macro cell sites and more than 500 small-cell sites. Verizon already uses WOW’s Chicago fiber network to backhaul traffic from the cell site to the switch and says that this deal will reduce its fiber leasing costs.
The deal, which is expected to close in the first quarter of 2018, follows several other fiber agreements that Verizon has inked over the past year as part of its efforts to beef up its network in advance of its 5G launch.
In the company’s second quarter earnings call with investors, SVP and CFO Matt Ellis said that the company believes that 5G will require a large small cell deployment and also a lot of dark fiber assets. “The densification activity will continue here for a good number of years,” Ellis said. He also said that fiber is going to play an important role in Verizon’s network, not just for wireless, but also wireline applications such as smart city deployments.
In April the company signed a three-year $1.05 billion deal with Corning for up to 12.4 million miles of optical fiber from 2018 through 2020. And in May Verizon signed a three-year $300 million deal with Prysmian to supply more than 10.6 million miles of fiber.
But that’s not all. Verizon also picked up some fiber assets (in addition to a lot of 28 GHz millimeter wave band spectrum) in its $1.8 billion acquisition of XO Communications in 2016.
It also spent $3.1 billion purchasing Straight Path’s millimeter wave (mmWave) spectrum. The deal, which is expected to close in the first quarter of 2018, includes 868 licenses in the 28 GHz and 39 GHz bands.
In all, the company has spent more than $6.5 billion acquiring fiber and mmWave spectrum assets in preparation for its 5G network.
Verizon has been testing fixed 5G using mmWave spectrum and fiber backhaul. The company said it plans to have trials this year in 11 markets including Ann Arbor, Michigan; Atlanta; Bernardsville, New Jersey; Brockton, Massachusetts; Dallas; Denver; Houston; Miami; Sacramento, California; Seattle; and Washington, D.C.
Ellis said during the company’s second quarter investor call that so far eight of those 11 market trials are running. He added that the company is confident it will be commercially launching fixed 5G in some markets in 2018.