Hotwire Communications might be T-Mobile's next fiber target (2025)

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There are rumblings that T-Mobile might make a move to acquire Hotwire Communications, a fiber network operator with a footprint covering parts of several US states, including Florida, Georgia, Texas, Arizona, Nevada, South Carolina, North Carolina and California.

Hotwire markets services under the "Fision Fiber" brand.

According to the financial analysts at New Street Research, TMT Finance reported that T-Mobile is on the "shortlist" for a purchase of Hotwire. TMT Finance is a subscription-only service that bills itself as offering "actionable intel before it goes public."

"We heard the same down at Metro Connect," the New Street analysts added in a note to investors Thursday, referencing the recent Metro Connect trade show in Florida. Hotwire, the analysts wrote, "is an asset that is largely focused on MDUs [multi dwelling units, typically apartments] in denser markets. It could be an interesting complement to Metronet and Lumos, which are mostly building [fiber] in areas with less competition."

The context

T-Mobile, of course, has made clear its interest in fiber. The mobile network operator launched its first fiber offering in New York City in 2021 with Pilot Fiber. Since then, it has expanded its T-Mobile-branded fiber offerings to 32 markets across eight states via partnerships with the likes of Tillman FiberCo, SiFi Networks and Intrepid Networks.

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More recently, T-Mobile acquired fiber operator Lumos in a joint venture (JV) between the mobile network operator and private equity firm EQT. It's pursuing a similar transaction with KKR for Metronet. And T-Mobile is chasing federal fiber funding in Louisiana via partnerships with Swyft Fiber and REV, two local fiber operators there.

"We are interested in the space," T-Mobile CEO Mike Sievert said of T-Mobile's growing fiber ambitions, during the operator's quarterly conference call this week. "We're out there kicking the tires. Our appetite is limited. It has to be just the right thing. And we've kind of shown our preference for pureplay fiber. That doesn't mean we're going to limit ourselves to that, but we've shown our preference for that."

Founded in 2002, Hotwire counts Blackstone among its financial backers. Last year it covered more than 1,180 properties and about 4,300 commercial customers.

(Blackstone, it should be noted, recently purchased a stake in Rogers' wireless network in Canada for $5 billion.)

The strategy

Speaking Thursday on its Q1 2025 earnings call, T-Mobile's CEO offered more insights into the company's fiber expansion strategy.

Related:FiberLight to acquire Metro Fiber Networks

"Our intention is to move quickly and for the majority of our work to be first to fiber. And that's where the returns are best," T-Mobile's Mike Sievert explained. "That means there's probably a cable operator. There may be fixed wireless available in that area. But our intention, generally speaking – generally speaking, is to be first to fiber."

Sievert also said T-Mobile isn't terribly concerned about the geographic locations where it's offering fiber.

That, according to the New Street analysts, indicates T-Mobile isn't pursuing a convergence strategy that would closely tie its fiber operations with its wireless network.

"If he [Sievert] was worried about the network convergence imperative (the need to use fixed assets to create mobile capacity), geography would matter a lot," the New Street analysts wrote. "He would be building fiber in dense markets where he might need capacity in future. He wouldn't be as concerned about market structure."

Concluded the analysts: "This tells us that, at this stage, Mike [Sievert] really is focused on maximizing the return on the fiber assets he is buying rather than using them to protect returns in his wireless business. His focus could change, but the network convergence imperative doesn't seem top of mind right now."

Related:T-Mobile Fiber could see 5M customers and $5B in revenue by 2030

T-Mobile officials said the company will release more details about its "T-Fiber" business in the next few months.