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Windstream to install fiber optic internet


It was recently announced that Windstream, a communications company headquartered in Little Rock, Arkansas, is planning to install fiber optic internet in Grinnell in the fall of 2019. This announcement was a surprise to many, not least because the City met with Windstream last year to discuss building a fiber-optic network, and at that time the company did not express interest in building one in Grinnell.

Last week, The S&B reported on the prospect of fiber-optic internet coming to Grinnell, brought by the Mahaska Communications Group (MCG), based in Oskaloosa, Iowa. The timing of Windstream’s announcement raises questions about their true motivations for bringing fiber to Grinnell and whether or not it was prompted by a fear of increased competition from MCG.

Windstream, also known as Windstream Holdings, Inc. or Windstream Communication, filed for bankruptcy in February of this year after a federal court ruled that the company had violated bond agreements during the transition of its telecom assets to the spinoff company Uniti Group, Inc.

In the ruling, Windstream was ordered to pay the plaintiff, hedge fund Aurelius Capital Management, $310.5 million, an amount that caused Windstream to file for bankruptcy.

Later in February, the United States Bankruptcy Court for the Southern District of New York gave permission for Windstream to access up to $400 million of funds, available through the business’s Chapter 11 filing, to allow the business to continue to function while reorganizing its debts.

The plan being discussed by MCG and the City involves making faster internet accessible to all residents of Grinnell (most major businesses already have their own internet service). The underground cable installation would occur in one neighborhood at a time in 2020 and continuing into 2021 if necessary.

Windstream is promising sooner installation, fast service, reliability and affordable prices on the project, but the company doesn’t necessarily have the town’s favor.

One potential issue with Windstream’s current service plan is coverage. The company intends to use aerial fiber, or fiber strung between utility poles, to build the network. However, not all parts of Grinnell have nearby utility poles, which could lead to sections of the city being left without coverage under Windstream.

Additionally, MCG is a local company, while Windstream is based in Arkansas, and MCG has spent more time in discussion with the City than Windstream due to the recent nature of Windstream’s announcement of the project.

Grinnell City Manager Russ Behrens said that the City’s intention is to find the company that will provide the most accessible and usable network to Grinnell.

“At the end of the day, our goal is not necessarily to support one over the other, it’s to provide the best broadband service to the community that we can, so that’s what we’re trying to do,” Behrens said.

Behrens said that the timing of Windstream’s announcement might be related to the city’s discussions with MCG. “Our job is to make sure that what they’re promising the community is clear, and that it’s actually followed through with. They very well may have every intention of doing that, but … we’ve been talking to them for some time about our interest in improving fiber in Grinnell, and until MCG showed up, they had no interest. … I think it’s an undeniable correlation.”

There isn’t necessarily an either-or debate between the two companies. Both could start applying for permits to build a network at the same time. Behrens considers it to be the duty of the City to ensure that citizens of Grinnell are appropriately educated about their options.

He said, “At a minimum, we want to make sure people are well informed about what is truly happening.”

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    SteveApr 29, 2019 at 8:52 am

    I can say, with 100% certainty, that Windstream decided to build the fiber as a direct result of MCG coming into the area. The only thing that will get them to build is the threat of losing their current customers. They won’t upgrade anything unless there is competition.