Verizon Completes XO Fiber Buy; 5G Stage Set

Verizon has completed its $1.8 billion purchase of XO's fiber business, setting the stage for 5G.

Elizabeth Miller Coyne, Managing Editor

February 1, 2017

2 Min Read
Verizon Completes XO Fiber Buy; 5G Stage Set

Verizon has completed the $1.8 billion purchase of XO's fiber business, a move that sets the stage nicely for the operator's 5G deployment and trials expected this year.

Further boosting the power of the deal, Verizon Communications Inc. (NYSE: VZ) also announced that it has entered into a deal to lease certain wireless spectrum from former XO Communications Inc. affiliate NextLink Wireless. And according to the operator, Verizon has an option, exercisable under certain circumstances, to buy Nextlink Wireless Inc. (See Verizon Completes XO's Fiber Business Purchase.)

With XO's fiber in its coffers, Verizon plans to not only densify its cellular network and deploy 5G, but also expand its network service offerings, including video, to its enterprise and wholesale customers. (See Verizon Sees Video Through Rings of Fiber.)

Integration of all XO operations and facilities is expected to commence immediately: Verizon anticipates the transaction will deliver in excess of $1.5 billion in operating and expense savings in net present value, according to today's announcement.

In September, Verizon's CFO Fran Shammo told the audience at a Goldman Sachs & Co. conference that Verizon's fixed wireless 5G, with 1 Gbit/s connections to the home, will take on cable, "or any broadband connection for that matter," and that deploying 5G will be much cheaper than deploying FiOS. (See Verizon CFO: Eat Our (Fixed) 5G Dust!)

He also said that the company's key advantage in deploying 5G is the rights to lease 28GHz bandwidth from NextLink. "That covers 40% of the US," he said then, adding "That's all licensed for fixed wireless use for the time being, as per the Federal Communications Commission (FCC) rules. We're hoping that'll become mobile at some point down the road."

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— Elizabeth Miller Coyne, Managing Editor, Light Reading

About the Author(s)

Elizabeth Miller Coyne

Managing Editor

Elizabeth Miller Coyne has been a writer and editor for over 20 years with 16 of those years focused on the telecom sector in a variety of capacities, including journalism, corporate communications, public relations, radio show host and more. Formerly editor of Light Reading's The New IP site, she is now leading the content and direction for Light Reading's new online learning community, Upskill U. In January, she was appointed to the NASA JPL Solar System Ambassadors program -- a public outreach program designed to work with volunteers from across the nation to communicate the excitement of JPL's space exploration missions and information about recent discoveries to people in their local communities.

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