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Rochester Philanthropist Tom Golisano Acquiring Greenlight Networks

Golisano

Rochester billionaire and philanthropist Thomas Golisano is seeking expedited regulatory approval from New York’s Public Service Commission to acquire Rochester-based Greenlight Networks, LLC, a fiber to the home network provider for an undisclosed sum.

Greenlight Networks has been slowly overbuilding Charter/Spectrum and Frontier Communications’ service areas in eastern Monroe County since 2012, offering subscribers gigabit internet access. But time may be running short for Greenlight’s competitive broadband speed advantage. Charter Communications is reportedly planning to introduce gigabit service as early as April 25th throughout upstate New York, except for Buffalo.

The urgency of the transaction’s approval is clear in the companies’ filing with state officials requesting an expedited review and approval of the transaction.

“Greenlight’s […] need for working capital and the optimization of capital structure required for long-term success in the competitive telecommunications industry are matters for urgent consideration,” the application states. “Greenlight seeks Commission approval in order to avoid unnecessary delays in the completion of its network expansion projects and in order to secure valuable, committed, outside investors who share Greenlight’s vision and believe in its ability to execute on its plan.”

Greenlight’s success is likely dependent on its ability to rapidly expand its fiber optic network before its biggest competitor, Charter’s Spectrum, capitalizes on its forthcoming ability to match Greenlight’s download speeds. Greenlight receives praise from subscribers lucky enough to live in a neighborhood reached by its network. But residents also report frustration over the slow pace of the company’s fiber network expansion, particularly in suburbs west of the Genesee River that bisects the city of Rochester.

Golisano’s Grand Oaks LLC of Pittsford, N.Y. promises customers the acquisition will not result in any changes in Greenlight’s rates or its terms and conditions.

The petition claims the acquisition is in the public interest because it will offer Greenlight much-needed additional capital to accelerate deployment of its fiber network inside Rochester and beyond. Greenlight’s website suggests the company is considering expansion into the New York State cities of Albany, Binghamton, Buffalo, Ithaca, Syracuse, and the Finger Lakes Region. In Connecticut, the company is considering serving Bridgeport, Danbury, Hartford, New Haven, and Stamford (the corporate home of Frontier Communications). Grand Oak also promises to grow jobs at Greenlight and increase operational efficiency at the company.

Golisano is well-known in Rochester as an entrepreneur, philanthropist, and civic leader. Golisano founded Paychex, a leading national payroll service provider in 1971. After his retirement in 2004, Golisano has been actively involved in local civic causes and advocates for policies promoting improvement in the economy of western New York State.

The application is likely to be approved, but not soon enough to combat Charter Communications’ accelerated broadband upgrades across New York State. By early summer, Spectrum customers across New York State will receive 200 Mbps Standard service, 400 Mbps Ultra service, or 940 Mbps (nearly gigabit) Gigabit service from the cable operator at prices ranging from $65-125 a month. In contrast, Greenlight currently offers customers 100 Mbps for $50, 500 Mbps for $75, or 1,000 Mbps for $100 a month.

Currently there are 12 comments on this Article:

  1. FredH says:

    We need this across all of Upstate NY….give Spectrum some legitimate competition in it’s entire service zone.

  2. TimmyT says:

    Maybe this will help them expand faster than the snails pace they are on now.

  3. Conan says:

    Perhaps more important than speed is the probability that Charter will institute usage caps as TWC tried to. They have agreed not to for a period of time but eventually may make another try to offset declining cord cutter revenue.

    Just as Rochester once said “no thanks” to local phone service provided by the Bell System and created Rochester Tel to maintain local control of an important technology resource, we need to be the masters of our own Internet connectivity. In some other areas of the country, municipal government has provided this as a utility but it’s clear that Monroe County will not do so even with its ownership of under-utilized fiber.

  4. OYoung says:

    They must have pulled the wool over Mr Golisano’s eyes pretty well. I’m all for the competition but this company is sketchy. Contractors showed up in my backyard unannounced to install Greenlight’s equipment to the telephone poles. When I asked who they were an what they were doing one man became belligerent with me. I called the electric company who owns the poles and found out Greenlight hadn’t even requested permission to be on the poles in my area. A few years prior they came to the neighborhood to find customers to pledge money so they could build their network, some of my neighbors were foolish enough to pay them and still don’t have service 3 years later. So not only do they trespass and illegally attach to telephone poles but they also generate revenue off of would-be customers in areas they technically don’t even have a right to be.

    • It is very unlikely Greenlight would attach infrastructure to utility poles without a permit because it is an involved and integral part of network construction. Poles in our area are owned by RG&E, Frontier, or the municipality (certain suburbs). One of the biggest delays — the dreaded “easements required” would-be customers might see on the network expansion page involves getting proper permits and clearance to place their fiber optic cables and equipment on utility poles and in public rights of way. Once a contract is signed, existing tenants on that utility pole perform “make ready” work to relocate or make room for Greenlight, a process that can take months.

      The deposit that customers pay is intended to demonstrate seriousness of intent on the part of would-be customers, an important way Greenlight can demonstrate to bankers and backers that the interest of would-be customers to sign up is legitimate. Other fiber overbuilders have similar policies. Those deposits are fully refundable on request.

      I think Mr. Golisano sees the opportunity that we do. Not only is there pent up demand for an alternative to Spectrum (and Frontier is no longer a serious contender), but having fiber run deep into neighborhoods opens the door to lucrative wholesale bandwidth sold to forthcoming 5G wireless networks, which will operate with thousands of neighborhood small cells attached to utility poles. Spectrum’s fiber reach doesn’t go nearly as deep, because their network still relies on a hybrid fiber-copper coaxial cable system. Then there is the future of machine to machine Internet of Things traffic, intelligent highways, and many other applications that will depend heavily on fiber optics. By then, Frontier will have declared bankruptcy reorganization and Spectrum itself will likely ditch the remaining copper it has and move towards fiber as well.

      Competition is always a good thing, and western New York is dismally behind much of the rest of the country in telecom infrastructure.

  5. Steve says:

    The article states that Greenlight May find competition tough since Spectrum will soon be offering faster internet offerings. The article ignores one important point. Spectrum service is terrible and they have pissed off so many people that would love to have another option so they could say so long to spectrum. First hand experience here.

    • I realize lots of people hate Spectrum (or Comcast, or whatever cable company services a particular area.) Historically however, most people will not change providers no matter the benefit of doing so. There are issues of resistance to action/change, dislike of having installers come into peoples’ homes, reasonable satisfaction with the service they get now, and installation or activation fees.

      In cities where Verizon FiOS exists, they usually manage to grab ~40% of the market, with the cable company still dominant, even though FiOS offers superior services. Most people reading this are probably early adopters and are more than willing to change. But the average Rochester resident, when asked if they knew about Greenlight, will think you are talking about a traffic signal. If you doubt that, just consider the number of people still clinging to Frontier’s horrendous DSL.

      You and I will probably sign up with Greenlight the day the service is switched on in our area, but most people probably won’t. Spectrum will also roll out some strong retention offers if Greenlight does light up this county. In other cities where competition is strong, the company has offered insanely cheap offers to hang on to customers.

      IMHO, Greenlight will need to make significant changes to its marketing. I personally think it needs a different name that better describes what it offers, along with some type of deal or partnership with one or more over-the-top TV and VoIP phone providers so that less aware consumers can seamlessly switch providers and be assured of keeping television (and to a lesser extent phone) service. Those aged 50+ are still strong adherents to cable television. Many under 30 have never subscribed to cable TV and never will. You don’t need to force people into bundles, but you should have some solutions ready for those who want or need those services. Telling them they can shop around on their own for those services will turn at least a segment of potential customers off,

  6. Rob says:

    I live in Webster. I have been on Greenlight’s sign up list, after paying my $10, for nearly 3 years now.
    Our neighborhood is at 94% of sign ups needed. I do hope Mr Golisano is successful, and that priority
    for implementation respects existing demand. I will drop Spectrum the moment it is possible to do so,
    imagine many would do the same.

    • It’s my experience that Greenlight’s percentages for fiberhoods does not always correlate with where they actually wire service. I’ve seen neighborhoods at 100% waiting a year for service while others that were below 90% suddenly added to the easements required or final engineering lists.

      No district in Webster is currently at 94% so things have changed. Construction in the Raphael and Parklane districts — both in Webster — is imminent.

  7. Kris says:

    Someone in our neighborhood claims that we’ll never get Greenlight as all our lines are underground. Is that true?

    • Greenlight has traditionally shied away from neighborhoods with all-buried utilities because the cost of wiring them is considerably more than aerial cable installations. I expect that will change with Golisano’s involvement, but probably not this year.

  8. Bob says:

    Absolutely correct. Raphael and Parklane us due to have construction start very soon. Finally. My order was placed in July,2015. So the streets with above ground wiring are good to go. Those with underground wiring, no.

    Rob, if you actually ordered service, then you should have received two e mails from Greenlight by now re: your order. I called them to upgrade my order to the 1 gig service level because there is no install fee for that level. You MUST keep that level of service for two billing periods before you can bump it down to 500/50 or 100/20 levels. My plan is to go to the 500/50 speed after those two billing cycles are over. Otherwise, you are looking at a $100 installation charge for the two lower levels.







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