Unraveling the Potential Impact of T-Mobile’s Entry into Retail Fiber Market

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In a move that could alter the landscape of the soaring retail fiber market, T-Mobile US is reportedly negotiating with open access network operator Tillman FiberCo about utilizing its fiber-to-the-premises (FTTP) infrastructure. This development, brought to light by Bloomberg, could signal T-Mobile US’s formal foray into this ever-growing global arena.

In the past, T-Mobile US has exhibited interest in the fiber broadband sphere and rumors have persisted that it is on the hunt for a co-investor or partner to ease the potential cost implications of such a venture, which could run into billions. In this aspect, Tillman could prove to be a perfect match.

Bloomberg’s data, sourced from individuals knowledgeable with the situation, propose that should these talks yield positive outcomes, the telco will serve as a chief tenant on a FTTP network. This network is currently jointly constructed by Tillman FiberCo and Northleaf Capital Partners.

These developments align with expectations since Tillman joined forces with private equity firm Northleaf only last month. A strategic partnership was created, allowing for a US$200 million input from Northleaf for the FTTP rollout, with projections hinting that this figure could surge to $500 million as Tillman broadens its scope.

The details regarding coverage plans and similar goals remained hazy, but the scale of this project is likely substantial. Tillman FiberCo, a subsidiary of Tillman Global Holdings and headquartered in New York, was established in 2021 to unroll wholesale, high-speed fixed Internet infrastructure to support both retail partners and businesses. Interestingly, Tillman Global Holdings was initiated by telecom veteran Sanjiv Ahuja, famously known for his stretch as chief executive of Orange.

“When we consider Tillman FiberCo’s wholesale business model, combined with massive anchor customer orders, we are confident about the long-term revenue stability that our investors seek in our infrastructure portfolio,” stated Chris Rigobon, Managing Director at Northleaf. His comments left observers in the industry speculating about the identity of this significant anchor customer.

However, T-Mobile US might just fit the profile. Despite their scant presence in the US fixed broadband market, they have shown initiative in developing their 5G fixed wireless access-based home broadband service. There had even been murmurs about T-Mobile considering the creation of a new fiber business entity, in partnership, to invest up to $4 billion in FTTP.

Currently, their FTTP coverage is limited but exists in certain regions of New York. As various entities in the US progress with their rollout plans, even with the government incentivizing the deployment of fiber in remote locations, it’s expected that a formal announcement of a potential partnership with Tillman FiberCo will be impending. Of course, this holds true only if such a deal does exist.

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