Lafayette’s publicly owned fiber optic network is expanding beyond city boundaries for the first time with plans to offer internet, television and telephone services in Broussard and Youngsville in the next two months, the Lafayette Utilities System announced Monday.
The expansion is a significant leap for LUS Fiber, which launched with a $125 million bond issue that voters approved in 2005. LUS Fiber served its first customer four years later, following bitter legal fights with competitors Cox Communications and BellSouth, the latter of which AT&T acquired in 2006.
The system turned a profit in 2013, and today commands 40 percent of the Lafayette city market with $36 million in revenue last year, said Terry Huval, the city-parish director of utilities.
Future expansions elsewhere in Lafayette Parish are likely, Huval said, but LUS will first evaluate its returns in Broussard and Youngsville. Huval would not say what LUS is investing in the expansion, or how many new customers he expects to sign up, citing concerns with competition.
LUS aims to achieve market share in the expansion area that is “somewhat comparable to what we have in the city of Lafayette,” Huval said.
“The investment is very small compared to what the benefits could be down the road for us,” Huval said, adding that the expansion is being paid for strictly with proceeds from the original bond issue or self-generated revenue.
That’s a different tune than the one Youngsville residents heard when they asked to be included in the network back in the early days of LUS Fiber, said Mayor Ken Ritter. The only way Youngsville would have received services then would have been to pay for the construction costs, Ritter said.
“It sounds as if their business model has evolved to the point where they can expand, and with no infrastructure cost upfront for us, so I’m excited about it,” Ritter said.
Ritter, along with Broussard’s mayor, Charles Langlinais, said younger constituents in the fast-growing communities are demanding more competition. Langlinais said he expects competition to be fierce.
“They have been very aggressive in putting down fiber in the newer subdivisions,” Langlinais said, referring to Cox and AT&T. “My only concern is I have X amount of utilities servitude room, and it’s getting very crowded.”
Asked for comment on the LUS expansion, Lafayette-based Cox spokeswoman Patricia Thompson noted in a statement that Cox has invested nearly $200 million in Acadiana and Baton Rouge infrastructure over the last six years while competing in a somewhat unique environment.
“Through the years we’ve faced competition on all fronts,” the statement says. “Since 2009, we’ve competed with our local government.”
AT&T declined to comment.
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