Verizon Communications (NYSE, NASDAQ: VZ) has awarded Prysmian Group a three-year contract worth approximately $300 million to supply more than 17 million fiber-km of ribbon and loose tube cables. The fiber deal is the second major such purchase Verizon has made in the past month, following an even larger contract signing with Corning.
As was the case with the Corning contract, Prysmian will supply fiber-optic cable for Verizon's continuing roll out of a fiber platform that will underpin deployment of 5G services, improve 4G LTE capabilities, and deliver other broadband services. In announcing the deal, Prysmian stated, "Both Prysmian and Verizon feel strongly that demand and supply for the next-generation passive optical network (NG-PON2) will last well beyond 2020 as new technologies like 5G and the IoT become reality."
"As the world goes wireless, wireless is drawn to fiber. Economic growth and consumer demand depend largely on superfast, gigabit broadband connectivity that is always available," emphasized Philippe Vanhille, senior vice president, telecom at Prysmian Group. "Our pronouncement is that this is best delivered over a fixed optical network."
Also echoing the Corning announcement, Prysmian says it will make what it called "a significant investment" in its North American cable manufacturing capabilities through 2018 in light of the award. The company operates three telecom production sites in the United States, two for the production of optical cable and one for optical fiber. Prysmian added that an unannounced portion of the new business will involve material management services offered by third-party providers owned and operated by certified woman business-owned enterprises.
"Prysmian Group's telecom division is an established optical cable and connectivity solutions provider to Verizon. This strategic supply agreement helps ensure we can ramp supply in order to expand our network capacity and speed 5G deployment," commented Viju Menon, Verizon's chief supply chain officer.