Texas-based Nextlink Internet is hitting its stride as it turns ten, with founder and CEO Bill Baker telling Fierce it expects to ride a fiber frenzy and government funding opportunities to exponential growth over the next three years.
The company, which was the top bidder in the Federal Communications Commission’s (FCC) Connect America Fund (CAF) II auction in 2018 with $281 million in winnings, was also the number six bidder in 2020’s Rural Digital Opportunity Fund (RDOF) Phase I auction with winnings of just over $429 million. In addition to the ongoing CAF II build and the RDOF projects ahead of it, Baker said it’s also looking to capitalize on rapid population growth in Texas that is increasing demand for its fiber service.
Founded in 2012 with a focus on serving rural areas, the company got its start serving consumers with fixed wireless access technology. It began rolling out fiber in 2017, and now covers around 10 communities in Texas and one in Nebraska with the technology. All told, Nextlink operates in seven states, including Texas, Oklahoma, Kansas, Nebraska, Iowa, Illinois and South Dakota. It currently has around 85,000 subscribers, with about 80,000 of these using fixed wireless and the remainder on fiber. That’s up from the approximately 20,000 subscribers it had when it emerged as the top bidder in the CAF II auction.
Looking ahead, Baker said it expects to surpass 100,000 subscribers by the end of 2022, approach 200,000 by the end of 2023 and reach 300,000 by the close of 2024. He added the latter figure will likely include around 100,000 fiber customers.
The company is still hard at work on CAF II projects, recently hitting the 40% milestone in most of the states where it won funding on the way to fulfilling its commitment to cover just over 100,000 locations. In the last month, Baker said it stood up around 70 towers in the rural countryside to bring fixed wireless coverage to around 30,000 new customers. At the same time, it also deployed around 7,000 new fiber passings.
Nextlink is also gearing up to get rolling on RDOF builds once the FCC greenlights its winning bids and releases funding for those projects. Those commitments span just over 200,000 locations across 12 states, including areas of Wyoming, Wisconsin and Minnesota immediately adjacent to its existing footprint as well as parts of Louisiana. “We’re ready to start throwing in permits for thousands of miles of fiber builds,” he said of its RDOF preparations. “We’ve already got the teams, the crews, the equipment. We’re ready to start plowing.”
The ultimate mix of its RDOF projects remains to be seen, but Baker said rollouts will use a combination of fiber and fixed wireless access. It is precisely its ability to provide this combination of technology which Baker said perfectly positions Nextlink to help close the rural broadband gap.
“There’s going to be a lot of markets where we serve fiber in the small town and we’re going to serve fixed wireless in the countryside,” he said. “That’s the challenge when you get out into a rural marketplace. When I say rural I’m talking about small towns and communities where fiber company XYZ is going to come in and they’re going to fiber up that town…but they’re not going to touch the countryside. But you know, in a small community like that a lot of the kids that go to the school district are the ones that live outside the city limits.”
Nextlink currently provides gigabit fixed wireless service using an Adtran solution and mmWave spectrum. It also has a handful of towers equipped with gear from Tarana. Baker noted it is also testing 6 GHz equipment from Cambium Networks which it hopes to use to replace legacy 5 GHz kit in its network to provide a performance uplift for users.
According to the CEO said there’s a “tremendous” amount of synergy between its CAF II and RDOF commitments, noting some of its winning census blocks are sometimes right across the highway from one another. He added it’s pursuing other government funding opportunities stemming from the American Rescue Plan Act and other recently passed laws which allocated money for broadband. But it sees fiber momentum even outside of these programs. And it’s planning to pounce.
“We’re doing a significant amount of fiber-to-the-home in Texas right now,” he said. “A tremendous amount of master plan communities and large developments are going up out in the countryside which historically might have been a fixed wireless service area for us. And instead they’re taking down that 200-acre pasture that had cows and one home on it and they’re putting up 2,000 homes. And so those are turning into fiber developments for us at a pretty fast clip.”
Baker pointed out that Nextlink secured a strategic investment from cable player Cable One in 2020 and scored a second investment from the company in 2021 which essentially left Nextlink debt free.
That means “We are well positioned from a financial standpoint to grow our business radically here over the next three to five years,” Baker concluded.