Squan’s Pennachio Optimistic for 2021

By J. Sharpe Smith, Senior Editor

March 25, 2021

Our senior editor, J. Sharpe Smith, spoke with Squan chief strategy officer and executive vice president Keith Pennachio, this week about the challenges and opportunities that he envisions for the deployment of network infrastructure solutions in 2021.

eDigest: How is Squan set as 2021 gets rolling?

Pennachio

Pennachio: Squan, over the last six years since I’ve been here, has been growing quite a bit. We have made several acquisitions. The most recent one was the acquisition of ElecComm (ECC), last November, an electric and communications line construction company, based in Wilmington, Massachusetts. So that acquisition adds another 50 people, as well as electrical infrastructure capabilities, which layers on nicely with our fiber capabilities, our fiber construction business and our fiber engineering, as well as wireless engineering, and our wireless construction business. So, the company is hovering around 450 employees.

We serve much of the East Coast with our construction services and our engineering services cover the entire country. We also provide construction services in other pockets outside of the East Coast. We will continue to grow in the course of 2021. We’re pretty excited about the year, especially with vaccines coming online.

eDigest: Where are your strengths?

Pennachio: I’d say that from a strength perspective, our engineering business, which includes aspects of site acquisition and traditional wireless A&E, is probably strongest nationwide right now. We’ve done a lot of expansion in the years since we purchased Osmose Communications Services (OCS). That group, because of its nimbleness and the transferability of services without rolling trucks, has allowed us to expand pretty cleanly across the entire country in a very meaningful way.

Our fiber construction business continues to thrive and is very active from the Carolinas up north to New England, because of the demand there and because of the requirements in so far as adding trucks and personnel. We’ve grown probably about 200 percent in the last two years.

As we look to other markets in the Midwest for fiber construction, while we see them as opportunistic, we put a little more emphasis on our evaluation on what it means for SQUAN, concerning the amount of effort, finances and resources.

In the wireless business, we cover most of the East Coast down to Florida and we have picked up a few projects in the Midwest.

In our power construction services group, focused predominantly in New England, we saw an avenue to take what was an 80 percent concentration on electrical services and 20 percent communications business and level it off to 50-50 concentration of services under that group. We also want to expand into New York and New Jersey.

eDigest: Which wireless customers are most active?

Pennachio: We’re looking at expanding with Verizon in several other markets, along with T-Mobile and targeting some of the the tower companies, which are playing a much bigger role. We’ve seen an increase with the OEMs in particular, over the last six to nine months where our relationships with both Samsung and Ericsson, have strengthened. We’re looking to support them as they expand, but we’re also aware that direct and indirect spend varies from market to market, and we’re sensitive to that.

eDigest: Do you expect a boost from the billions of dollars planned for rural broadband?

Pennachio: Absolutely. In fact, historically, on our outside plant engineering side of the business, we’ve been very involved in the Connect America Fund. As it transitions to the RDOF (Rural Digital Opportunity Fund), we are talking to the big players that were winners in the RDOF auction. We’re looking at how we support them on various projects, such as fiber to the home.

eDigest: What are the challenges of the upcoming expanded rural broadband buildout?

Pennachio: As new entrants make their way into the rural broadband market, we have to be sensitive to the fact that they need to get up to speed on how some of this work is executed. Squan is adopting certain project management tools and even modifying our organization to align more with the budget management organization structure.

We are taking lessons learned for various markets with certain clients and applying those to new markets, as well as to new clients that may not have been building fiber or wireless assets in any meaningful way. We’re looking at how we provide value in that niche and really drive that business for the company.

eDigest: You have the capability to build out a wireless system or a fiber system. Which is best?

Pennachio: That’s been a debate for as long as I’ve been in this business, for more than 20 years. There’s no single answer. More fiber in more places has become the new mantra, right? More bars in more places certainly resonates with the wireless crowd, but fiber capacity has really got to be there to support some of these wireless 5G applications. That doesn’t even account for autonomous driving vehicles and other smart infrastructure that will have a strong play in the ecosystem.

eDigest: New York City is offering up some of its infrastructure and providing funding to drive universal broadband infrastructure, targeting unserved or underserved residents. What kind of opportunity does this hold?

Pennachio: These larger cities are really thinking ahead and looking to adapt in the most meaningful way. Opening infrastructure for network operators to leverage is a very smart move. You’ll start to see some of the cable companies start to participate on a greater scale. It’s a trend you’ll see accelerate throughout the entire country.

eDigest: Your clientele is diverse. How do you approach selling to companies in the power, fiber and wireless industries?

Pennachio: It’s a challenge. We do our best to offset any technical challenge by cultivating personnel to have cross functional responsibility. Whether a client is on the power side, the fiber side or the wireless side, we try to demonstrate to them our value in leveraging our tools, as well as our subject matter expertise, to steer them down a path of a unified purchase order. We try to look at areas of a client’s business that would ultimately benefit from adjacent services within just one portfolio services, and then bring those together.