Omni Fiber juices Midwest expansion with Ohio Telecom buy

Fledgling operator Omni Fiber scooped up regional service provider Ohio Telecom for an undisclosed sum in a move designed to speed its plans to reach 250,000 locations across the Midwest over the coming years. Omni Fiber CEO Darrick Zucco told Fierce the network it is acquiring is 100% fiber and covers approximately 5,000 households.

Omni Fiber launched earlier this year, securing $250 million in funding from Oak Hill Capital for a plan to cover a quarter million locations across Ohio, Michigan and Pennsylvania. In the former, it has announced plans to build in the towns of Bellevue, Clyde, Dover, Huron, Sandusky, Shelby and Tiffin.

The acquisition of Ohio Telecom will give Omni a foothold in the towns of Port Clinton and Oak Harbor, and it will allow the operator to speed builds in the nearby cities of Sandusky, Perkins Township and Fremont. Construction in all three is set to begin early next year. The Sandusky Register recently reported Omni Fiber is planning to spend $17 million on its rollout in the city and will launch service in May 2023.

“We will get more economies of scale focusing on communities where there is a need, and building more areas geographically near each other with a high concentration of homes will allow us to operate more efficiently, build faster, and go to more places,” Zucco explained. “We realize the need for high-speed broadband in many communities and residents are eager to have new options for Internet access, [so] we want to reach them as quickly as possible.”

Zucco declined to say whether it’s in talks to secure deals in its other target markets of Pennsylvania and Michigan as well. However, he noted it “would be looking for companies that would allow us to grow faster, that provide assets for synergies with construction, primarily via fiber.”

Omni Fiber has good reason to want to speed its build. Analysts have noted that fiber players who go up against just one cable or DSL player in a market stand the best chance of success. When too many fiber players enter a given city, there’s less market share to go around and feed returns on the construction investment. And Omni isn’t the only one eyeing Ohio and the Midwest.

Brightspeed is looking to build to 170,000 fiber passings in Ohio, 40,000 in Pennsylvania and 10,000 in Michigan in 2023. AT&T, Breezeline, WideOpenWest, Altafiber (formerly Cincinnati Bell) and Windstream – which have all emphasized a focus on fiber – all also operate in Ohio.

Omni’s target markets in Ohio are sandwiched in between AT&T’s fiber territories in Cleveland to the east and Toledo to the west, the Federal Communications Commission’s new broadband coverage map shows. Since it took over Lumen Technologies’ assets in 20 states, Brightspeed now owns some fiber in the Lorain area just to the east of Huron. Windstream’s Kinetic Fiber is also lurking in the Elyria area to the east of Huron. And in Sandusky, incumbent cable operator Buckeye Broadband is in the process of overbuilding its network with fiber.