Ziply nets 100K new passings with iFIBER acquisition

Ziply Fiber inked a deal to buy Washington State-based iFIBER Communications for an undisclosed sum. Harold Zeitz, Ziply’s CEO, told Fierce the acquisition will allow it to reach deeper into Washington state than it would have been able to by building alone.

Founded in 2005, iFIBER is an open access ISP, meaning it delivers service using infrastructure owned by Washington’s public utility districts (PUDs). It currently has around 18,000 customers, but through its agreements with PUDs covering seven counties covers a total of around 100,000 passings.

In acquiring iFIBER, Zeitz said Ziply is scooping up not just its customer base but also the right to market its service to the remaining 82,000 or so passings across Chelan, Douglas, Franklin, Grant, Kitsap, Mason and Pend Oreille counties. Zeitz noted the PUDs already connect their assets into Ziply’s core network and the deal with iFIBER will save Ziply the trouble of having to build its own distribution network in the aforementioned counties. 

The CEO added that while Ziply’s goal is to reach 80% of its overall footprint with fiber, it would only have been able to economically cover about 50% of the area included in the deal. Put another way, the transaction will enable Ziply to get to some locations “we would never economically get to” otherwise.

“It’s a great opportunity for us to be able to serve a larger audience,” he stated. “It’s an example of where it’s non-economic for private companies to build, that’s where that public private partnership really makes sense.”

The deal is the second Ziply has struck so far this year. Back in June it picked up Oregon fiber and fixed wireless service provider Eastern Oregon Net, Inc (EONI) for an undisclosed sum.

Zeitz said Ziply made a strategic decision not to build fiber in the areas covered by the acquisition. But including the passings it is gaining through the deal, Ziply will end the year ahead of its expansion target.

The operator has previously said it is aiming to reach 80% of its footprint with fiber within three years. Though Ziply has not publicly disclosed its annual build goal, the operator ended 2021 with 40% of its footprint covered and Zeitz said in January it would continue deploying to a "few hundred thousand" new locations each year until it hits its mark.

In 2023, it plans to build to about 10% more locations than it reached in 2022, with these split between edge outs and new builds within its ILEC footprint.

As to whether more M&A could be in the cards in 2023, Zeitz said “we definitely see a few more of these small to mid-sized build verse buy opportunities” but has nothing to announce yet.