Join Alejandro Piñero at Broadband Nation Expo as he interviews Joel Daly, Senior VP of Government Affairs and Product Strategy at Zayo. Daly shares insights on Zayo’s mission to enhance communication infrastructure across North America, emphasizing the critical role of middle mile connectivity in bridging the digital divide. He explains how Zayo’s strategic investments and government partnerships aim to provide affordable broadband to underserved rural areas. Daly also discusses the importance of connecting data centers and future-proofing networks to meet evolving demands, including the impact of AI. This conversation highlights Zayo’s innovative approach to expanding broadband access and the challenges and opportunities in the industry. Don’t miss this engaging discussion on the future of connectivity!
Alejandro Piñero:
All right. Welcome everyone back here at Broadband Nation Expo. I’m Alejandro Pinero. And yet another industry leader joins me now for a conversation. I’m pleased to be with Joel Daly, senior vice president for government affairs and product strategy at Zayo.
Joel, thanks for taking some time off what I’m sure is a busy few days for you here at the show.
Joel Daly:
No, thank you very much.
Alejandro Piñero:
Excellent. Well, listen, I think most folks will know, Zayo, of course. But just to set a level playing field, a few words about who you are and your position in the industry.
Joel Daly:
First, from a Zayo perspective, we are one of the largest independent communication infrastructure provider in the US. Now, we focus on North America. We have operations also in Europe. But our concentration really is North America and the US. I have been with the company for around five years. As you have mentioned already, I run both the government programs, but also product strategy. And that’s kind of a weird thing in that I do run the five-year plan. I do run the product strategy. And you’d say, “Wow, why is the government person doing that?” They’re very interrelated, especially with everything that’s happening in the US and in North America.
Alejandro Piñero:
That’s great. That’s a great way to describe how those two come together.
Joel Daly:
Yes.
Alejandro Piñero:
Now, Joel, we’ve been hearing a lot about the role of middle mile here at the show and even in our coverage at Fierce Network. What role does middle mile play in what we’re all trying to achieve, which is connecting everyone and bridging the digital divide?
Joel Daly:
Yeah. Matter of fact, when I think about it, I have a close coworker, Myunk, and I went to our senior leadership team probably around two and a half years ago, and said, “Hey, we have a once-in-a-lifetime opportunity in terms of everything that’s happening in terms of the upgrade of our infrastructure.” And the beautiful thing is if we can think about what we need to do from a company standpoint and achieve a mission of connecting and enabling these underserved and unserved areas, it’s a great mission.
And when we think about middle mile, if you’re going to serve underserved in rural areas, middle mile is the problem. Meaning that if you were in a metro, it’s cents on the dollar for services. If you are rural, it is a dollar plus in terms of that type of capability. So the whole mission that’s out there is to try to figure out how to provide metro pricing in rural areas. And so when we think about the importance of middle mile, if we can provide a capability of very economical capabilities in terms of these rural areas, we can solve that problem.
Now, traditionally, we would build between metros and we would have no exit ramps. All we would do is go from one metro to the other one with our express lanes. And now what we can do with this infrastructure funding is create multiple exit ramps and solve not only the problem for our larger customers that want to go between metros, but hit these rural communities that so badly need access to the internet and broadband.
Alejandro Piñero:
And I also wanted to ask you, of course those rural areas, metros, it’s important. But you guys are also working on connecting data centers, which will play a key role in all these services. So wanted you also to touch a little bit on that aspect.
Joel Daly:
Yeah. Always when I have to explain the business of what we do. We connect where data is created and where data is processed. Matter of fact, when we went to our leadership team and say, “Why should we get involved in this?” Where data is processed is all the data centers. Matter of fact, 50% of our revenue is in data centers. We connect to 1500 of the most important data centers that are out there.
And why is that important? Well, look at any app on your phone, look at any app that we’re doing, wherever you are, it’s kind of being processed in those data centers. So that’s very critical. But the thing that’s changing is where data’s created. Meaning we used to be measured always on on-net buildings, office buildings. When’s the last time you’ve been to an on-net office building?
Alejandro Piñero:
Well, I work remotely, so never.
Joel Daly:
Bingo. We all do. So you have kind of a change that’s happening in terms of where data’s processed is growing. We still connect to the mass. But really what’s changing is where data is created. And so very interesting in terms of being able to provide the solution, especially meeting both needs in terms of these underserved areas and where other high density/data creation’s happening.
Alejandro Piñero:
And let me then ask you on that point of how things are changing. So of course, you’ve got all these miles and middle mile out there. You’ve got this very big infrastructure, investing in developing more. Surely, you have to future-proof it, right? So wearing perhaps your product hat for a second, where’s that investment going when you’re thinking about that network? You mentioned people now work remotely or they have different needs than they did a few years ago. How do you look forward and address that when it comes to your network?
Joel Daly:
Yeah, it’s pretty interesting. Believe it or not, we look at power. So if you think about we connect where data is created or data is processed. Data is processed, data centers. So we study very carefully what’s happening on the data center side. And the most interesting thing in terms of the data center side of the house, especially with AI and all the changes that are happening, it’s the availability of power. And so we have to connect and be where all the data center connectivity that’s out there.
Now, the most interesting and most beautiful thing in terms of combining the government strategy with our product strategy is if you think about our long haul connections, we actually have to go through many rural communities. We have to go from yes, one metro to another. But where power is now, these facilities are out in very remote locations, and we have to have a long haul that goes out there. And the thing I get excited about the AI convergence with serving and heading the mission of what we’re trying to do would be is that all we have to do is do exit ramps now.
And I’ll give you several examples. In the middle of Oregon, there is multiple major data centers, and it’s really kind of going from the major metropolitan up to Portland, but we would never in the past have exit ramps. Now we’re like, “Yes, let’s have exit ramps.” And so very interesting convergence in terms of what’s happening on the AI side, but still hitting the mission of providing broadband everywhere. And I think there’s a good little niche.
There is a con. No, not a con. It’s a really good thing. It’s just so much money is going towards this stuff. If you look at fiber to the home, if you look at AI, if you look at the government stuff, it’s a lot of activity, which I’m so excited to increase broadband infrastructure, but it’s a lot going for the same resource.
Alejandro Piñero:
Yeah. No, that makes a lot of sense. Now, Joel, if I can tap into your government affairs hat now for a second.
Joel Daly:
Yes.
Alejandro Piñero:
Zayo has been very successful in getting funding from a federal level to your middle mile programs. Now that know BEAD is coming to the point of taking those RFPs and hopefully getting into that final stages before the funding kicks in, I wondered if you had any words of advice to those folks and organizations, big or small, that are working through that and working through the grant process and how to hopefully get some success there?
Joel Daly:
Yeah. And I think there’s a couple of trends both from a end user applicant, and even the broadband director standpoint. So the interesting thing, a couple of trends that we’re seeing there. Obviously we’re not a last mile provider. And our strategy has been, “Hey, let’s provide access where the last mile provider or BEAD recipients are going to be.”
Always when I think about this, you have the BEAD folks and the last mile providers trying to build the local roads. And if you think about the money distributed to a state, it’s multiple pockets. So you have two strategies. You hope that last mile providers kind of line up and the middle mile works, or you’re seeing some states like Nevada and several other states try to have a more logical approach to say, “Hey, how do we make sure that there’s no wasted money in a logical place in terms of the middle mile location that it should be?”
And so when we think about this in terms of the BEAD stuff, the two trends that I’ll come back to is working with states that are thinking about the middle mile more holistically. For better or worse, it is just easier for us to work on a continuous strategy. The other one that’s happening though that’s kind of interesting that’s evolving is some of the last mile providers are creating alliances to figure out, “Well, what pieces could we take in order to have a logical middle mile?” And you optimize the costs. And we’re seeing that across several states right now.
Alejandro Piñero:
Yeah. That’s fascinating.
Joel Daly:
Yeah.
Alejandro Piñero:
Well, listen, Joel, I think we could chat all day. You guys are clearly working on a lot of fronts and it’s always great to hear. Before we wrap up, I think I’d be remiss not to congratulate you on the Broadband Nation Award, what you got today. I see you have it here. So you’re clearly carrying it proudly around the show. But clearly you’re mission has been [inaudible 00:10:59] recognized.
Joel Daly:
But I’ll tell you right now, it is for the mission and it’s for the people that work for me that do a beautiful job.
Alejandro Piñero:
Excellent.
Joel Daly:
So thank you.
Alejandro Piñero:
Wonderful. Well, Joel, thank you so much for joining us. Always a pleasure to hear from you and your team, and best of luck.
Joel Daly:
Awesome.
