Plugtek BPL eLibrary :: News Alert: Plugtek Powerline eLibrary Dec 13 2004

  • From: "Plugtek Powerline Network eLibrary" <freelists@xxxxxxxxxxx>
  • To: plugtek_com@xxxxxxxxxxxxx
  • Date: Mon, 13 Dec 2004 14:48:25 -0700



News Alert!
Category: Utilities


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ConEd Pulls The Plug On Broadband

New York's giant Consolidated Edison power company is exiting the broadband industry, selling off its Con Edison Communications (CEC) subsidiary to FiberNet for $37 million in cash. ConEd is one of the last major, and believed to be the biggest, power utility still left in the telecom game selling managed services to large corporate users. The theory behind the sale is that a network services specialist such as FiberNet will be a more nimble and competitive player in the market.

FiberNet says the acquisition, which still requires the approval of federal, state and municipal regulatory agencies, will more than double its revenues in the New York metropolitan area. For the first nine months of this year, FiberNet had $23.7 million in revenues and CEC had $23.9 million.

The deal also gives FiberNet access to ConEd’s electric conduit system, a coveted right of way that gives it a leg up on other network providers in the New York area. According to FiberNet, the combination of its own existing network and CEC's assets will result in a network of almost 80,000 fiber miles and access to 190 building in New York and Los Angeles, including 18 telco central offices, 22 carrier hotels and 150 commercial buildings. Management of the combined FiberNet-CEC will be a blend of FiberNet and CEC executives, and the transaction will be paid for by the issuance of convertible preferred stock.

There was no discussion of ConEd's ongoing trial of broadband over powerlines, a technology that could – potentially, at least -- partially compete with the fiber-based managed services from CEC. ConEd has said in the past it doesn't plan to use that technology to go into the broadband delivery business itself, but sources have told TelecomWeb in the past that the giant utility has discussed renting powerline broadband capacity to ISPs.


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