AT&T and fund manager BlackRock announced a joint venture to operate a fiber-optic platform in the United States.
The venture, Gigapower LLC, plans to deploy its network to an initial 1.5 million customer locations outside of AT&T’s traditional 21-state wireline service presence.
AT&T and BlackRock would jointly own and govern Gigapower. They did not disclose additional deal terms.
The news comes as AT&T plans to expand its high-speed home internet service to newer areas in the country, in a bid to attract new subscribers.
AT&T had hired Morgan Stanley to help bring in an infrastructure partner to the broadband venture, which could be valued at $10 billion to $15 billion, Bloomberg news report said in October.
AT&T plans to report consumer subscribers served through Gigapower in its operational results and said any impact on spending and free cash flow from the venture will be included in the forecast it plans to provide at its quarterly earnings next month.
BlackRock, which manages $313 billion in alternative investments that include private equity, real estate and credit, has signed the deal via a fund in its diversified infrastructure unit.
Gigapower expects to provide fiber network to internet service providers (ISPs) and other businesses across the United States.
Gigapower will serve customers outside of AT&T’s 21-state wireline service footprint. AT&T will leverage its nationwide wireless sales capabilities to sell fiber to customers in Gigapower territories.
Gigapower plans to deploy fiber network to an initial 1.5 million customer locations across the nation using a commercial open access platform. The Gigapower fiber deployment will be incremental to AT&T’s existing target of 30 million-plus fiber locations, including business locations, by the end of 2025.
“We have a team of professionals building this scalable, commercial open access wireline fiber network. Our goal is to help local service providers provide fiber connectivity, create the communications infrastructure needed to power the next generation of services and bring multi-gig capabilities,” said Bill Hogg, CEO of Gigapower.