TDS To Extend Fiber To Shoreline

November 25, 2003
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GRAND RAPIDS — Moving to broaden its base in West Michigan, TDS Metrocom plans to expand a fiber-optic network toward lakeshore communities next year and continue investing in infrastructure.

After commencing operations of a 55-mile fiber optic ring throughout Kent County earlier this year, TDS will begin deploying the network into Ottawa County during 2004. The Kent County end of the project cost $35 million and created the capacity to handle 2.3 million calls simultaneously.

The company entered the telecommunication market in Michigan in June 2001 by launching local telephone service.

TDS now plans to offer space on the fiber network for commercial users requiring high-speed data links. The company’s extension of fiber optics will further increase competition in West Michigan among telecom providers vying for a share of the lucrative and growing data-transmission market.

“That’s where the future is,” said Mark Neistat, TDS’s Grand Rapids-based regional marketing manager.

“The landscape is changing and we view ourselves as a player,” Neistat said. “If you want to be a major player you have to be involved in it, so we’re putting in our loop.”

TDS, a unit of Chicago-based Telephone and Data Systems Inc’s. subsidiary TDS Telecom, gave no specific time frame for the extension of its fiber network into Ottawa County and toward the lakeshore.

TDS’s planned extension route is into the Byron Center vicinity and then west through Jenison and Hudsonville. From there, the network would deploy down Chicago Drive to Zeeland and Holland areas, then northward along U.S. 31 to Grand Haven.

Beyond 2004, Neistat said, TDS wants to extend the network to Kalamazoo-Portage and into central Michigan, from Lansing to Jackson.

The extension of the West Michigan loop follows TDS’s long-term strategy of developing its own Michigan infrastructure, rather than relying on leasing space on the network of its competitor, SBC Communications Inc.

By possessing its own network, TDS is reliant on incumbent network operators for only the “last mile” from its lines to homes and businesses. Neistat said this makes TDS more competitive and — by working directly with clients — better able to control its own fate. He said, however, that TDS can extend fiber optics directly to a business for high-speed data transmission when it’s economically viable for both parties.

“TDS would rather own its own fiber and have total control of the network than lease a network,” said Sarina Gleason, manager of market communications for TDS. “We can manage it better. It enables us to give the business absolute service from TDS Metrocom.”

In contrast to other service providers that lease space from SBC, TDS has invested more than $70 million in Michigan in the last few years to create its own network for local and long-distance phone service.

Combined with the investment to create the fiber loop in Kent County, the company has invested more than $105 million in Michigan and has additional investments planned for the future.

“We’re here to stay. We are investing in the communities in which we do business and we have long-term goals,” Gleason said. “We are kind of living up to what the telecommunications industry is to become and bringing competition and investing in the communities.”

In southeast Michigan, TDS has 15 miles of fiber deployed and is presently constructing 38 additional miles.

The West Michigan market has been the company’s most successful in the state. Of the 50,000 local residential and commercial phone lines established statewide since June 2001, about 30,000 are local.

Overall, TDS has 700,000 phone lines in the three states in which it operates (Michigan, Wisconsin and Illinois), including 200,000 long-distance customers, plus 100,000 Internet customers that include 19,000 subscribers to its DSL high-speed Internet service.

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