Month: May 2020

Four men in uniform carrying Chinese national flag

China Is About To Go On A $3.8tr Digital Infrastructure Investment Spree

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Chinese tech leaders attending the National People’s Congress and Chinese People’s Political Consultative Conference told the nation’s top chiefs that the country needs more cloud infrastructure investment and that it can lead in many fields such as AI, 5G and IoT.

The ‘everything is bigger in China’ motto has this week gained a deeper meaning with the true scale of IT infrastructure investments revealed across data centres, telecoms and the wider technology spectrum.

In total, China is expecting over the next five years to top more than CNY27.1 trillion (US$3.78 trillion) in new infrastructure construction and related investments, according to Haitong Securities. This amounts to an average of $63 billion per month between 2020 and 2025.

Infrastructure developments are expected to total CNY10 trillion ($1.4 trillion) whilst generating related investments of CNY17.1 trillion ($2.38 trillion).

In 2020, as much as CNY3 trillion ($423 billion) are to be invested already in new projects, benefiting 5G base stations, data centres, industrial internet, artificial intelligence, new energy vehicle charging infrastructure, and intercity high-speed rail network.

The figures include several projects already in the public domain, namely Tencent’s $70 billion data centres, cloud and AI investment, Alibaba’s $28 billion cloud infrastructure expansion roadmap,  China Mobile, China Telecom and China Unicom’s combined $25.2 billion 5G base stations deployment projects, and more.

Cities and regions across China have also voiced their intention to heavily invest in the digitalisation of their infrastructure. As many as 20 provincial-level regions have unveiled plans with Shanghai planning to spend around $37.7 billion in the next three years.

The investment announcements come at a time when China’s tech sector is undergoing a nationwide stimulus very much driven by China’s very own tech moguls.

The most recent show of an industry “tech-push” was at the Two Sessions, China’s most important political event comprising of the National People’s Congress (NPC) and Chinese People’s Political Consultative Conference.

One of the key calls came from Ma Huateng, also known as Pony Ma, Tencent’s founder and NPC deputy, who released a seven suggestions manifesto on how to advance China’s economy, including four points solely focused on technology.

In one of the suggestions, Ma said: “The proposal states that China’s digital economy is moving towards a new era in which new infrastructure is the strategic cornerstone, data is the key element, and industrial Internet is the advanced stage. The Industrial Internet should be planned in the historical tide of a new round of scientific and technological revolution and industrial transformation and promoted from the height of national strategy to continuously strengthen China’s digital economy.”

He continued to say that China needs to strengthen the top-level design, formulate a national strategy to systematically promote the development of the industrial Internet, and focus on the research and promotion of new infrastructure, digital transformation in all walks of life, smart cities, scientific research and innovation, and network information security.

Ma proposed to accelerate the advancement of new infrastructure such as cloud computing and build a “strategic cornerstone for the development of the digital economy” including a focus on and breakthrough in the construction of a “data centre” to further promote the open sharing of data, innovate and promote the construction of smart cities and villages, and improve digital governance level.

On a different point titled “Suggestions on Using Digital Technology and Innovative Application Models to Help Small and Medium-Sized Enterprises”, Ma said that financial and tax support is an important means to help enterprises get out of the predicament, and digital technologies represented by big data, cloud computing, and artificial intelligence can also help small and medium-sized enterprises.

He said: “In the near term, new models such as “human labour on the cloud” and “shared labour” can alleviate the difficulties faced by small, medium and micro enterprises, increase their ability to resist risks, and unblock the “capillaries” of the economic market; strengthen the digital upgrade of financial services and enhance financial The accuracy of the service will help the small and medium-sized enterprises “last mile”.

“In the medium and long term, strengthening the cloud platform and promoting the comprehensive digital upgrade of traditional small and medium-sized enterprises will help to enhance the overall strength of small and medium-sized enterprises.”

The other two points on technology focused on improving the level of China’s financial technology and actively responding to international competition and challenges in the context of financial opening, and promoting system and technology innovation, improving medical and health services, and increasing the gain of medical staff.

China’s National Development and Reform Commission (NDRC) has also recently unveiled a new roadmap for the way infrastructure is managed in the country by diving it into three areas including information-based infrastructure, converged infrastructure, and innovative infrastructure that supports scientific research, technology development and product development.

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Blackstone-Backed Phoenix Tower International Signs Agreement with eir to Own and Operate Tower Sites Across Ireland

Source: Phoenix International Tower

May 25, 2020

BOCA RATON, Florida & DUBLIN, Ireland –Phoenix Tower International (“Phoenix”) today announced the signing of an agreement with eir to purchase over 650 wireless towers and acquire newly constructed wireless towers over 8 years across Ireland through a build-to-suit programme. This transaction positions Phoenix as the largest tower infrastructure provider in Ireland, materially expands its growing footprint in Europe, and further solidifies the company’s leadership position in Europe, the United States, Latin America and the Caribbean. Closing is subject to customary conditions precedents for this type of transaction. Phoenix and eir have established a long-term partnership whereby eir will occupy the sites for at least twenty years.

“We are excited to enter the Irish wireless infrastructure market and partner with eir on such an important transaction. The global pandemic related to COVID-19 has impacted all of our communities and highlights the importance of wireless infrastructure to support global trade, commerce and social connections. This will not diminish as economies rebound in the coming months and years ahead,” stated Dagan Kasavana, Chief Executive Officer of Phoenix Tower International.

“Ireland represents an important economic hub for Europe and the world, and we are proud to support eir on their ongoing build-outs across the country. This transaction further expands PTI’s global footprint and we are excited to be a long-term partner of eir” said Tim Culver, Executive Chairman of Phoenix Tower International.

“We are excited to partner with eir to deliver improved wireless connectivity to its customers. This transaction exemplifies Phoenix’s strategy of entering into growth markets as a partner to top-tier wireless carriers” said Jasvinder Khaira, a Senior Managing Director in Blackstone Tactical Opportunities. “Phoenix is committed to growing in Europe and finding opportunities to support carriers and usher in the 5G technology revolution.”About Phoenix Tower International

Phoenix Tower International (“Phoenix”) owns, operates and proforma for this transaction will have in excess of 9,000 towers, 986 km of fiber and over 80,000 other wireless infrastructure and related sites throughout the United States, Argentina, Bolivia, Colombia, Costa Rica, the Dominican Republic, Ecuador, El Salvador, France, Guatemala, Ireland, Jamaica, Mexico, Panama, and Peru.

Phoenix was founded in 2013 with a mission to be a premier site provider to wireless operators across the Americas in high-growth markets. Phoenix’s investors include funds managed by Blackstone Tactical Opportunities and John Hancock, as well as various members of the management team. For more information, please visit

Freshfields Bruckhaus Deringer and Arthur Cox acted as legal advisors to PTI.About eir

eir is the largest provider of fixed line telecommunications services in Ireland, offering broadband, voice, TV, and data services to residential, small business, enterprise, and government segments.

eir is the third largest mobile operator in Ireland in terms of revenue and customers. The company operates the eir mobile and GoMo services.

eir’s wholesale division, open eir, is the largest wholesale telecommunications operator in Ireland, providing products and services to national and international wholesale customers across a range of regulated and unregulated markets.

The Group generated total revenue of €1.249 billion and adjusted EBITDA of €578 million for the year ended 30 June 2019.

Exterior of FCC building

FCC to Vote June 9 on Procedures for Rural Digital Opportunities Fund Auction

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FCC Chairman Ajit Pai Monday circulated among his colleagues draft procedures for the upcoming $16 billion Phase I Rural Digital Opportunity Fund auction (Auction 904). With financial support from the auction, providers will expand broadband service to millions of unserved homes and businesses in rural areas. 

Pai plans to hold the Commission vote on finalizing the procedures at the agency’s June 9 meeting. Auction 904 is the first phase of the Commission’s $20.4 billion Rural Digital Opportunity Fund initiative, which is modeled on the Connect America Fund Phase II auction in 2018. Bidding in Auction 904 is scheduled to begin on October 29.

“We’ve designed this auction to ensure robust participation, with incentives for bidders to build high-performance networks so we get fast broadband to as many as six million American homes and businesses that aren’t currently connected,” said Pai. “The COVID-19 pandemic highlights the need for the Commission to continue its work to ensure that all Americans have access to high-speed broadband as soon as possible. That’s one reason why we’re moving full speed ahead with the Rural Digital Opportunity Fund.”  

The draft auction procedures strike a balance between building sustainable networks that will meet the needs of the future while maximizing the number of locations that receive service. The auction targets census blocks that current data show are wholly unserved. Funds will be allocated through a multi-round reverse auction. 

The Rural Digital Opportunity Fund Phase I auction more than doubles the minimum speeds that providers must deliver to 25/3 Mbps. It prioritizes bids offering to provide even faster speeds (up to a gigabit) and lower latency. It will give those bids greater weight and award support to the bidder offering the best combination of speed and latency in each area once the aggregate price of all bids drops below the auction’s budget.  

The Commission held a webinar May 5, to provide an overview of proposed procedures for applications and bidding in the auction. On May 20, the Commission will hold another webinar to help state, local, tribal, and territorial government officials understand the auction framework, and provide tips for service providers that want to participate in the auction.

Here is the draft timetable for availability of materials and auction deadlines:

  • Online auction application tutorial would be available by June 15
  • Short-form application (FCC Form 183) filing window would open July 1
  • Short-form application (FCC Form 183) filing window would close July 15
  • Auction bidding tutorial would be available online by October 14
  • Mock auction would begin October 26
  • Auction would begin October 29 

Those wishing to participate in this auction would be required to submit the short-form application (FCC Form 183) electronically prior to 6 p.m. EDT, on July 15, and comply with all applicable Commission rules, including the requirement to abide by the FCC’s National Security Supply Chain proceeding.



Sidewalk Infrastructure Partners logo

Alphabet Spinoff SIP Aims To ‘Future Proof’ Infrastructure With Tech & $400 Million Series A

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A new entity called Sidewalk Infrastructure Partners (SIP) has raised a $400 million Series A with the goal of “future proofing” infrastructure through technology.

This news caught our attention for more than one reason. First of all, the obvious. It’s not often you see such massive Series As. Secondly, this company was just formed last August and has already raised a massive amount of cash (Form D here). And it has raised it from some big names: Alphabet and Ontario Teachers Pension Plan.

So we did some digging. First off, Sidewalk Infrastructure is not a typical startup. It’s actually a 15-person holding company that is a spinoff of Alphabet’s Sidewalk Labs, according to Fortune, which broke the funding news. As mentioned above, the New York-based company says its mission is to “future proof” infrastructure through technology. Its goal is to build, own, operate and invest. And it’s focused on mobility, energy, water and waste, and digital infrastructure.

Google veterans Jonathan Winer and Brian Barlow are co-CEOs of SIP, which aims to “pioneer technology-enabled infrastructure to transform urban life.”

On its website, SIP notes that it takes a hybrid approach to opportunities it pursues. It owns, acquires and invests both in large-scale, technology-enabled infrastructure projects and in the companies that develop the underlying technology. It then convenes investors, policymakers, academics and technologists “to attack a challenge from all perspectives” before deploying capital on solutions.

An example of a company that it has backed so far, according to Crunchbase data, is AMP Robotics. The startup, which claims it creates robotic systems that sort recyclable material at a fraction of the cost of current technology, raised $16 million in a Series A last November.

On its website, SIP also notes:

“The population living in urban areas is expected to double by 2050. Cities — and the people who live in them — face daunting challenges. Climate change threatens to bring storms, flooding, and fires with increased frequency; greater density is causing congestion, air pollution, and a lack of affordable transportation; outdated waste and water systems are strained.

There is broad consensus — spanning sectors and political divides — that our country is in urgent need of trillions of dollars in new infrastructure spending.

The question is how to spend those trillions. We can’t keep investing in Band-Aids for infrastructure from a bygone era.”


Digital Colony logo

Digital Colony Is Seeking to Raise $6 Billion for a Second Fund

SOURCE: Bloomberg

(Bloomberg) — Digital Colony, an arm of Tom Barrack’s Colony Capital Inc., is seeking at least $6 billion for its second fund dedicated to communications-infrastructure bets, according to people with knowledge of the matter.

The firm has initiated discussions with prospective investors including pensions and sovereign-wealth funds, said the people, who requested anonymity because the talks are private. It’s seeking to hold a first close on the fund by November, one of the people said.

Digital Colony, led by managing partners Marc Ganzi and Ben Jenkins, closed on a $4.05 billion debut fund last June. Digital Colony Partners I has made 10 investments and is now more than 73% deployed, Ganzi said on a Colony earnings call last week. It’s doing due diligence and evaluating opportunities on which it may spend its remaining capital, he said.

Digital Colony teamed up with EQT Partners to purchase fiber-network owner Zayo Group Holdings Inc., and has agreed to buy data-center assets from Brazil’s Grupo Folha. Earlier this month, it recapitalized Beanfield Metroconnect, a provider of telecom infrastructure in Canada. Digital Colony also reached a deal to inject new equity into Vantage Data Centers as part of that company’s purchase of Etix Everywhere earlier this year.

A spokesman for Colony Capital declined to comment on the second fund.

Ganzi is slated to take over from Barrack as chief executive officer of Colony Capital on July 1 amid a turnaround at the real estate investment trust to focus on digital investments.

Colony Capital shares have tumbled more than 60% this year, leaving it with a market value of roughly $850 million. The company suspended its second-quarter dividend, saying it was seeking clarity regarding a “new normal.”

“Covid-19 has only amplified the fundamental demand for digital infrastructure and the world’s reliance on the digital ecosystem,” Barrack said on the earnings call, describing the Digital Colony business as “resilient and vibrant.”

Wall of lighted squares connecting

Lawmakers Ask for Cybersecurity Funding for States



As Congress continues to work on the contents of the next stimulus package, a bipartisan group of lawmakers are trying to gather support for earmarking some funds to modernize state and local governments’ IT infrastructure.

Rep. Michael McCaul (R-Texas), the ranking member of the House Foreign Affairs Committee, Reps. Jim Langevin (D-R.I.), Mike Gallagher (R-Wis.), and Cedric Richmond (D-La.) plan to send a “Dear Colleagues” letter to House lawmakers sometime this week, The Hill reported. The goal of the letter is to encourage more lawmakers to pressure Speaker Nancy Pelosi (D-Calif) and Minority Leader Kevin McCarthy (R-Calif) to include funds in the next funding package that state and local governments can use towards current and future IT modernization projects.

“Unfortunately, our digital infrastructure is (virtually) crumbling,” the lawmakers wrote in the not-yet-sent letter, according to The Hill. “Federal agencies often rely on IT systems that are decades old, and the problems are all the more acute at the state and local level.”

The lawmakers were concerned that state and local IT systems are not able to bear the increased load as people try to access “vital government services.” State unemployment sites have crashed in recent weeks under the weight of all the applications. Some states are trying to hire developers who know legacy programming languages such as COBOL to keep their systems running, because the systems are that old. State and local IT and cybersecurity are dealing with increased responsibility, but are hampered in what they can do with legacy systems.

All of these challenges may result in residents not being able to access the resources they need.

This is not the first letter from House lawmakers to Pelosi and McCarthy. In mid-April, House Homeland Security Committee Chairman Bennie Thompson (D-Miss) sent a letter along with Reps. Cedric Richmond (La.), Dutch Ruppersberger (Md.), and Derek Kilmer (Wash.) to Pelosi and McCarthy requesting cybersecurity funding for states and local governments to use to make sure their networks stay up and running.

“The American public is counting on State and local jurisdictions to implement and deliver COVID-19 relief packages approved by Congress,” that earlier letter said. “Any disruption in the delivery of services would only compound the strain on State and local governments struggling to effectively serve their citizens in the midst of a global pandemic. We cannot let that happen.”

Shortly after, a coalition of technology groups—The Internet Association, BSA, CompTIA, Cyber Threat Alliance, Cybersecurity Coalition, the Global Cyber Alliance, the Alliance for Digital Innovation, and the Information Technology Industry Council—also pressed Pelosi and McCarthy to make cybersecurity funding a priority in future Congressional funding packages. The groups were particularly concerned about the number of ransomware attacks against state and local government entities over the past year, and the likelihood that attackers would target state- and locally-owned and -operated public hospitals.

“State and local entities, however, have long lacked the resources to adequately secure and maintain their digital infrastructure,” the group wrote. “The rise in malicious cyberattacks targeting state and local entities, combined with the chronic lack of workforce, patchwork legacy systems, under-resourced cybersecurity and IT services, and uneven federal assistance creates a greater risk of system failure that interrupts services on which state and local populations depend.”

The ransomware attack against Baltimore last year is expected to have cost the city $18.2 million. Atlanta spent $2.6 million within the first few months of the attack that crippled nearly all its systems. A city auditor’s report later concluded that one of the reasons the ransomware attack had been so devastating for Atlanta was because of the sheer amount of legacy systems the city relied on. The report found nearly 100 servers running outdated versions of Windows, and many of the systems were severely behind on security updates. However, the problem of legacy systems isn’t unique to Atlanta. Municipalities have long had to defer modernization plans because they didn’t have funds or the authority to embark on these kinds of IT projects.

“This was the reality before COVID-19,” the groups wrote. “Things have become considerably worse in the months since.”

State and local government operated health systems make up nearly 20 percent of the country’s community hospitals, the letter from the tech coalition said. Medical facilities, research institutions, and other healthcare organizations have been targeted by ransomware and other cyberattacks over the past few weeks, “at a time when disrupted service is intolerable.”

“As it stands, State and local entities are simply not resourced to effectively address these new challenges over the extended period that pandemic mitigation measures will likely need to remain in place,” the groups wrote.

It is not clear whether there is enough political will within Congress to include cybersecurity funding, despite the fact that there is some support for it. It is also unclear when the House of Representatives will begin working on the next stimulus package.

“As we consider additional legislative measures to address the urgent needs of our citizens, we encourage you to consider the digital infrastructure on which so many of our constituents rely to access vital government services,” the House members plan to write in the latest letter.

Stephen Hadley, Former US National Security Advisor

How to use the next stimulus to counter China

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Stephen Hadley
Former US National Security Advisor

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May 11, 2020 at 4:30 a.m. PDT

SOURCE: The Washington Post

Stephen J. Hadley was national security adviser in the George W. Bush administration. Anja Manuel, a former U.S. diplomat, is director of the Aspen Security Forum and the author of “This Brave New World: India, China, and the United States.”

“Build back better” was the mantra New Orleans adopted after the devastation of Hurricane Katrina. It should be our country’s motto as we work to recover from the economic and public health crises caused by covid-19.

The Trump administration and Congress are rightly, and swiftly, acting to protect the U.S. economy and save jobs. In the prospective fourth stimulus bill, this must be the priority. But for relatively little investment, we can do more.

Americans are increasingly concerned about China. With massive investments in critical technologies, China seeks to dominate the future both economically and militarily. To meet this challenge, the United States needs to get its house in order.

A smart, strategic stimulus package including a few key provisions — some costing relatively modest amounts or even nothing — would allow the United States to compete effectively with China and others, and position the country for future prosperity, security and job growth.

Elements could include:

An investment in state-of-the-art broadband and other digital infrastructure. U.S. roads and bridges have to be rebuilt. But the coronavirus outbreak exposed how vital it is for all Americans to be digitally connected — whether they live in cities, towns or rural areas. It is past time to make the investments and regulatory changes required to create a best-in-class national digital infrastructure, including by fully funding the Federal Communications Commission’s Rural Digital Opportunity Fund.

Price tag: The FCC estimates it would cost$80 billion to provide broadband nationwide. Some $20 billion has been raised by auctioning off previously unused digital spectrum. An additional $6 billion a year would get all Americans connected by the end of the decade.

A substantial boost in federal research and development (R&D) spending. The United States needs to accelerate development of new technologies, particularly in artificial intelligence, quantum computing, biotechnology, advanced microchips and cyber. These technologies stand to revolutionize how business is done, services are provided and our nation is defended. But the U.S. government spent just $66.5 billion on basic and applied research in 2017, with less than 10 percent going toward computing, artificial intelligence, physics and the like. Private-sector investments in R&D are mostly to commercialize existing technology rather than basic research. The nation needs to do more.

Price tag: Every $10 billion per year of increased government R&D spending, a recent study found, could yield roughly 400,000 new jobs in the near term (about $25,000 per job). New tech hubs could be placed in hard-hit areas, attracting additional private investment.

Smart R&D tax credits. The Chinese government massively subsidizes “hard” technology of strategic importance. In the United States, by contrast, companies get the same R&D tax credit whether creating a new mobile app — or a craft beer — or investing in critical technology of substantial national security or economic significance. The nation should target generous tax incentives only toward the most critical technologies.

Price tag: If stronger tax credits for critical technology are coupled with less generous subsidies for the rest, this would require little or no new funding.

Support advanced semiconductor manufacturing. Semiconductors are the crucial building block of the information economy. America leads in chip design, but our manufacturing companies are losing market share and risk falling behind global state-of-the-art capabilities. China is lagging but is investing more than $100 billion to catch up. State-of-the-art semiconductor fabs, or factories, costing $10 billion to $20 billion each are mostly found in Korea and Taiwan. U.S. government financial incentives should bring home to this country capacity to manufacture the most advanced chips — for defense, advanced AI and other applications — that would create much-needed supply chain security and fuel further technological advances.

Price tag: With public-private burden sharing, the likely total cost would be less than $10 billion.

Strategic education investments. Science and technology talent are the foundation of U.S. success, yet our country is falling behind in science, technology, engineering and mathematics learning. Responsibility for K-12 education mostly falls to the states. But a smart, strategic federal stimulus package could provide financial incentives for STEM education at the university level. One model: The grants and partial student loan forgiveness provided under the National Defense Education Act that followed the Soviet Sputnik success in 1958.

Price tag: $1 billion to $3 billion per year.

Recommendations such as these have been validated in countless studies by a variety of experts. Other good ideas, of moderate cost, might also help while not taking away from the priority properly given to addressing the economic crisis caused by the pandemic. A smart, strategic stimulus package could support economic recovery while also laying the foundation for future prosperity, security and job growth. Together, they could set America up for success in a more competitive world.


Uniti Logo

Melody Investment Buys Over 500 Towers for $220M From Uniti

May 13, 2020


Melody Investment Advisors, an asset manager focused on communications infrastructure, yesterday announced the acquisition of 90 percent of Uniti Towers, the wireless tower business of real estate investment trust Uniti Group Inc. (NASDAQ:UNIT). The purchase totals approximately $220 million in cash and includes over 500 towers based in the U.S. Melody Investment Advisors will fund the purchase from Melody Communications Infrastructure Fund II.

Through an investment in an affiliate of Melody, Uniti will retain a 10 percent investment interest in the tower business and will receive an incremental earnout from Melody for each additional pipeline tower completed in 2020. In addition, as part of the transaction, Melody and Uniti will enter into a strategic relationship to collaborate on integrated solutions for wireless carriers requiring towers, fiber and small cell infrastructure. The transaction is subject to various closing conditions and is expected to close by the end of second quarter 2020.  

With the addition of Uniti’s towers, Melody and its affiliates now own and market more than 4,000 towers, ground leases and structure and rooftop leases, including pipeline sites. Melody and its affiliates are a top five independent owner of national wireless infrastructure assets and claim to be one of the largest privately owned telecom landowners in the U.S.

“As the transition to 5G continues, communications infrastructure is one of the fastest growing, most stable and critical segments of the economy. We are excited about the addition of these towers to our expanding portfolio and the benefits they will bring both to our carrier partners and to our investors,” said Omar Jaffrey, Managing Partner and Founder of Melody Investment Advisors. “We look forward to working with Uniti as we continue to grow and invest in our wireless infrastructure platform while seeking further growth through acquisitions.”

Aerial view of city

Alphabet Vets raise $400 million to Remake America’s Infrastructure

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SOURCE: Fortune

By Jeff John Roberts

May 7, 2020

As the U.S. hunkered in lockdown mode in mid-April, the influential venture capitalist Marc Andreessen published a viral essay titled “Time to Build.” The essay decried the complacency of Western democracies prior to the COVID crisis, and called for a mass rebuilding of physical and social infrastructure. It’s time, Andreessen said, to start over with everything: Roads, housing, education, the health system, the works.

Andreessen is not the only one to see an opportunity in the pandemic. Angela Merkel, the German Chancellor, has called for using economic recovery funds to further climate protection. And in the U.S., two veterans of Google’s parent company, Alphabet, tell Fortune that they are embarking on a massively ambitious plan to reimagine four pillars of the country’s infrastructure—and are drawing on an equally massive purse to do so.

The Google vets, Jonathan Winer and Brian Barlow, are co-CEOs of a new holding company called Sidewalk Infrastructure Partners (SIP for short) that is a spin-off of Alphabet’s cities-of-the-future arm, Sidewalk Labs. According to a securities filing, SIP has raised a Series A funding round of $400 million from Alphabet and investment giant, Ontario Teachers Pension Plan.

SIP claims it has a novel tech-powered approach to modernize the country’s infrastructure like never before. In the company’s first interview, Winer described how SIP plans to transform everything from recycling to how America deploys driverless cars—and how the new venture plans to avoid the political and public relations pitfalls that have tripped up Sidewalk Labs.

Solving the plastics problem

For a company looking to take on intractable infrastructure problems, SIP has more than a few to choose from. Take plastics. Right now, the U.S. is drowning in plastic waste. The country has never been able to recycle plastic to the same extent as metal or paper, and China’s recent decision to stop accepting overseas waste means piles of plastic garbage are growing ever higher. Now, the pandemic is exacerbating the problem as more stores and consumers revert to single-use plastics as a health measure. As with so many other infrastructure challenges, plastic recycling now seems beyond America’s capacity to solve.

SIP, however, believes it has a solution. The company has invested in a startup called AMP that claims its technology can perform recycling featsthat others cannot. SIP plans to build a facility in the Midwest that will obtain cast-off plastic from nearby recycling plants, and then sort it with AMP’s robotic arms and artificial intelligence software. SIP says its planned sortation plant will yield plastic that it will sell to the likes of Coca-Colaand Procter & Gamble—big, plastic-dependent companies that have pledged to reduce their environmental footprint.

The plastic venture is part of SIP’s quest to build a “circular economy”—a term popular in environmentalist circles that refers to incorporating trash and waste water into the production cycle. The circular economy is one of the four infrastructure priorities SIP is pursuing. The others revolve around transportation and mobility—particularly autonomous vehicles—as well as energy and digital infrastructure.

In every case, Winer says SIP’s approach is the same: The company identifies an infrastructure need, and then spends months developing a master plan to deploy a mix of technology and physical assets to solve it. Crucial to SIP’s approach, he says, is its network of influential people—such as Coke and P&G executives. “Once we have a thesis, we act as a convener. We bring together groups of people, including technologists, Alphabet executives, traditional infrastructure players and policy makers,” Winer says.

Over the long run, SIP plans to use the same playbook to spur inter-city highways for driverless cars or, in the case of digital infrastructure, build out network and storage capacity to bring highspeed Internet to both rural and urban communities.

The plan is an ambitious one, perhaps even a noble one. It is also fraught. To understand the perils, Winer and Barlow can look to the troubles of their former employer, Sidewalk Labs. Like SIP, its spinoff, Sidewalk Labs touted think-big ideas to transform the modern city with tools like sensors and data analytics. When it came to deploy Sidewalk Labs’ vision in the real world city of Toronto, however, the project became mired in political wrangling and a pushback from citizens fearful of Google gobbling their data. Today, the project is moving forward but so far it has done little to transform Toronto. Update: On May 7, Google announced it would abandon the project.

A new approach to building infrastructure

Winer is very much aware of the political headwinds that Sidewalk Labs has encountered, but believes SIP’s approach can overcome them. For starters, he says the company is not trying to offer up futuristic versions of the city, but rather to identify infrastructure that towns already need, and then help to build it. In many cases, this will be in the form of unglamorous—but sorely needed—facilities like those sorting plants for recycling.

Winer adds that SIP is taking care to consult mayors and other local officials about their needs, and does not engage in lobbying. “We’re not trying to sell our widgets,” he says, stressing that company is playing a very long game.

SIP also cites its unusual corporate structure as an asset. The company does not fit within the traditional business ecosystem of tech, which is driven by startups focused on a narrow set of products or services. Those startups are in turn funded by venture capital firms, which amass large funds of capital from investors who typically anticipate a return within seven years. This structure incentivizes startups to grow at a breakneck pace as their VC backers press them to achieve an “exit” by being acquired or going public.

Winer says that SIP, as a holding company, is set up to build and invest over a longer timeline and that its two large investors will not be pressing it to deliver returns in the near future. The holding company structure also affords SIP a greater degree of flexibility than other tech firms, allowing it to both acquire assets—like the Midwest sorting plant—and also invest strategically in startups that complement those assets. SIP also plans, in many case, to help operate the companies it backs.

Currently, SIP has 15 full-time employees, including finance veterans like Winer and Barlow, as well as data scientists and technologists. The company expects its ranks will grow over the next year.

As for delivering returns to Alphabet and Ontario Teachers, Winer says the timeline is longer than in the venture capital world but also not infinite. “We don’t have a timeline for liquidity or a return by date X, but we’re not doing 20 year science projects. It’s multi-year not multi-decade,” he says.

Like everyone else, SIP did not anticipate the coronavirus crisis, though Winer believes the company may be able to accelerate its mission as Americans reassess their priorities in the pandemic’s aftermath. And indeed the crisis appears to be creating a new political energy for tackling longstanding problems. In Italy, for instance, officials in Milan are pursuing a plan to limit air pollution by converting 22 miles of roads into cycling and pedestrian routes. Meanwhile, in New York City, some are calling for a massive upgrade of crumbling subway and highway system while the city is in partial lockdown.

All of this suggests that it may indeed be “Time to Build”—and SIP is ready.


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Digital Colony Announces Strategic Recapitalization of Beanfield Metroconnect

May 6, 2020–

Digital Colony, the global digital infrastructure investment platform of Colony Capital, Inc. (NYSE: CLNY), today announced a strategic recapitalization of Beanfield Metroconnect (“Beanfield” or the “Company”), an independent telecommunications infrastructure provider in Canada. In connection with this transaction, the Company has acquired the metro network of Aptum Technologies (“Aptum”), a global hybrid cloud and managed services provider.

The strategic recapitalization includes C$255 million of financing, positioning Beanfield to capitalize on a variety of new segment and revenue opportunities. Through the acquisition of Aptum’s metro network, Beanfield will enhance connectivity services and fiber solution capabilities in Toronto while expanding its presence in Montreal following the recent acquisition of regional telecom fiber services provider OpenFace Inc.

In partnership with Digital Colony, Beanfield has significantly scaled its platform to seamlessly connect individuals and businesses in Canada’s two largest urban markets. Since Digital Colony made a substantial investment in 2019, the Company has grown its network footprint ten-fold from approximately 400 route KM to more than 4,000 across both markets. The Company’s ability to service on-net buildings has also increased almost six-fold from approximately 550 buildings to 3,200 buildings.

“This transaction exemplifies our approach to underwriting and our commitment to fostering growth in exceptional businesses with strong management teams,” said Steven Sonnenstein, Managing Director at Digital Colony. “Today’s recapitalization underpins our confidence in the continued opportunities for growth that result from the unrelenting focus on the customer experience and high quality services that are at the core of Beanfield’s business.”

Leveraging existing relationships with leading institutional lenders, Digital Colony secured the financing, which includes a first lien term loan and a revolving credit facility. TD Securities served as joint lead arranger, joint bookrunner and administrative agent, while RBC Capital Markets and SunTrust Robinson Humphrey served as joint lead arranger and joint bookrunner.

Sadiq Malik, Managing Director at Digital Colony, added, “We appreciate the support of our lenders, who didn’t hesitate to provide this crucial financing despite the challenging market. Through this strategic recapitalization, Beanfield has added financial flexibility and is positioned for continued growth in its markets.”

“In today’s environment, the need for connectivity has only grown as networks experience unprecedented demand,” said Dan Armstrong, CEO of Beanfield Metroconnect. “At Beanfield, we have always invested in building communities – not just networks. We expect our employees, customers and valued partners in Canada’s two largest regions will see numerous benefits from this strategic recapitalization as we expand our offerings and increase our investment in robust fiber networks.”

About Digital Colony

Digital Colony is the world’s largest digital infrastructure investment firm with over US$20 billion in assets under management. Launched in 2018 by Digital Bridge and Colony Capital, Digital Colony brings together Digital Bridge’s industry, operational and investment expertise, and Colony Capital’s (NYSE: CLNY) global operating platform and capital markets access. Digital Colony is a leading investor, owner and operator enabling the next generation of mobile and internet connectivity through investments in mission-critical infrastructure around the globe. Headquartered in Boca Raton, Florida with offices in New York, Los Angeles, London and Singapore, the firm closed its first discretionary fund dedicated solely to investing in digital infrastructure with US$4.05 billion in commitments in 2019. For more information, please visit

About Beanfield Metroconnect

Founded in 1988, Beanfield is a privately held and 100% Canadian-operated company. Beanfield provides comprehensive telecom services to over 3,200 commercial and residential buildings and operates four boutique colocation facilities at key connection points within its fiber network. The company is facilities-based, maintaining and managing its own in-house construction and fiber maintenance teams. Beanfield’s residential services include Fiber-to-the-Suite Internet, TV and Home Phone. Its business services include Fiber Internet, Business Phone, TV, Dark Fiber, Private Line and Colocation. Beanfield is a portfolio company of Digital Colony, a global investment firm dedicated to strategic opportunities in digital infrastructure. For more information visit