T-Mobile US could be Tillman's anchor tenant for fibre

T-Mobile US is in talks with open access network operator Tillman FiberCo with a view to using its FTTP infrastructure, it was reported this weekend.

Should the report, which came from Bloomberg, prove correct, a deal would mark the entry of the US mobile operator into the fast-growing retail fibre market on the other side of the Atlantic. T-Mobile US has dipped a toe in the fibre broadband space and there have been rumblings for some time that it is looking for a partner or co-investor to help it take the plunge by sharing the potential multi-billion-dollar cost burden.

It could well be that Tillman fits the bill.

According to Bloomberg, which cites people familiar with the situation, if the discussions prove fruitful the telco will serve as an anchor tenant on a fibre-to-the-premises (FTTP) network being built out as a joint venture between Tillman FiberCo and Northleaf Capital Partners.

That makes a lot of sense. We have been expecting such an announcement from Tillman since it teamed up with private equity firm Northleaf last month. The pair inked a strategic partnership that covered the injection of US$200 million in funding from Northleaf for FTTP rollout, possibly rising to $500 million as Tillman expands the build.

They didn’t have a lot to say on coverage targets and so forth, but it was pretty clear this has the potential to be a fairly large-scale endeavour.

New York-based Tillman FiberCo, part of Tillman Global Holdings, is based in New York and was founded in 2021 with a view to rolling out wholesale, high-speed fixed Internet infrastructure to serve both retail partners and enterprises. The holding company, incidentally, was founded by telecoms veteran Sanjiv Ahuja, probably best known for his stint as chief executive of Orange a couple of decades ago.

“Tillman FiberCo’s wholesale business model, which is supported by a large anchor customer order, ensures the long-term revenue stability that our investors look for in our infrastructure portfolio,” said Chris Rigobon, Managing Director at Northleaf, a month ago. While Rigobon went on to talk up the benefits of this “attractive sector” to investors, telecoms industry watchers were left wondering who the large anchor customer might be.

Perhaps we need wonder no longer.

T-Mobile US has very little presence in the fixed broadband market in the US, although it has been quite aggressive with the expansion of its 5G fixed wireless access-based home broadband service in recent months. It’s the best part of a year since it was rumoured – again the story came from Bloomberg – to be mulling the creation of a new fibre business unit, with a partner of some sort, that would invest up to $4 billion in FTTP.

It does already have some FTTP coverage, but on a very small scale. It launched in parts of New York a couple of years ago and has added a few locations to its footprint since then, but its presence is still very limited.

It is doubtless keen to push on with its rollout plans; many others are doing so in the US and the government is working hard on its various projects to encourage the deployment of fibre in small communities and difficult-to-reach locations. With that in mind, we can probably expect an announcement on the Tillman FiberCo partnership sooner rather than later…assuming such a deal exists, of course.

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