How Neutrality Provides Freedom of Choice and Improved Service Quality

Juan Salazar recently joined Joe Scattareggia, executive vice president of Windstream Wholesale, on the Connect the Dots podcast. This latest episode features a discussion over the benefits of MDC’s partnership with Windstream, check out the transcript below.

Full transcript

Joe Scattareggia:

Welcome to Connect the Dots with Windstream Wholesale, the podcast where we explore strategic partnerships, industry trends and opportunities for expanding your network. And now here’s your host, Joe Scattareggia.

Hello everyone and welcome to the program. My name is Joe Scattareggia and I’m the Executive Vice President of Windstream Wholesale. Part of my responsibilities at Windstream include sales, marketing, product, and network expansion for the Wholesale business unit. One of the things that we always stress within the business unit is the value of strategic partnerships, both from a customer and a vendor standpoint. That’s why I’m excited today to have one of our key business partners in MDC with us today is CEO, Juan Salazar. Juan, welcome to Connect the Dots with Windstream Wholesale. How are you?

Juan Salazar (00:52):

Good, Joe. It’s great to talk to you.

Joe Scattareggia (00:54):

Great. Good to be, uh, thanks for coming and, and joining the program today. Maybe you could start by telling us a little bit about your background and a little bit about the company.

Juan Salazar (01:03):

So MDC has been around, uh, for a little bit over 10 years now, uh, we are a, uh, carrier neutral data center that really focuses just on the US-Mexico border, so that’s our entire, um, niche. And what we do is we provide a neutral location where networks can connect on the border. Yeah, we, I think our, our, our big claim to fame is the, um, the fact that we’re a carrier neutral, and when I say carrier neutral, I really mean that we don’t compete with our customers in, in any way. So we don’t sell IP, uh, or transport, uh, it’s just the, uh, uh, the colo and maybe the other piece set out to that is, uh, we’re also create what we call IFCs or International Fiber Crossings. So we build fiber from our data center on the US side to just on the other side of the, uh, of the river, or of the border. And, um, yeah, so I think that’s, uh, and been working with Windstream for a long time and, uh, really appreciate them as, as partners.

International fiber crossings into Mexico

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Joe Scattareggia (02:15):

Yeah. That, that’s, that’s a good way to, to, to term it, partners. It’s funny, you, you mentioned the International Fiber Crossing, I know that’s a term you’ve been using for years, which I love because it really describes, you know, what it is uh, that’s happening. You know, part of our strategy um, on the Wholesale side for, for Windstream has really been the development of infrastructure inside a lot of these cam- cable landing stations, which is no different, right? I look at a cable landing station as you have, um, similar to what you got, to, to where your position your International Fiber Crossing. You know, I, I look at the difference in my mind, whereas in Virginia Beach or Hillsborough you have wet cables coming in and the cables are actually landing onto land, so those are cable landing station. Your, you know, business or these International Fiber Crossing usually terrestrial that in this case is coming across the Mexican border into Texas or other parts of the country. So, um, interesting, uh, I, I do like that term by the way, so worth mentioning.

Juan Salazar (03:08):

(laughs) Thanks.

Joe Scattareggia (03:08):

Um, yeah, the, um, the, uh, so for, for Windstream our strategy as I mentioned has really been, um, and, and it’s a really valuable ed for us is to enable the international customers to get from the landing stations or the, the fiber crossings to key interconnection points in the US, um, on the Windstream network. You know, for example, from McAllen up to Dallas, we have a lot of that business and that’s, that’s been a popular run. And quite frankly you guys have helped us develop a lot of these markets through the relationships that the teams have uh, developed. Um, can you comment on the partnerships that we have with each one of your, uh, fiber crossing, um, markets?

Juan Salazar (03:46):

Um, yeah, sure. So I, I like the way you, um, you think of the uh, IFCs like the CLS. I think that’s a, that’s a good analogy. Um, I’ll just say that to me I, I think of the CLS like you have, uh, a cable traversing the ocean, whereas maybe an RKCIFC traverses a river uh, between the US and Mexico border. So the same concept just uh, um, a little bit bigger body of water. Um, so yeah, I mean to, to answer your second question, I think in the locations of when we started, uh, with Windstream here in McAllen, um, you know, we, we quickly found that it was a, a great partnership and, uh, you know, worked with Mike Crimmins for a long time, he’s a really good guy. Um, and a lot of that route was just being able to get up to, to Houston, Dallas, uh, overall the dash network down here in Texas. I think that’s great.

Juan Salazar (04:47):

Um, and the, another thing that we found really helpful with, uh, with Windstream is the ability to get in and out of, uh, the Rio Grande Valley on, on two paths. So you guys come down through Harlingen, but also up through Laredo, up to San Antonio. So that redundancy to get out of the Valley has always been very key and important to our, uh, Mexican customers. So I always thought that was great, and really being able, uh, you guys I know turned up in, in El Paso and I think it was really based on the, the, the great partnership that we’ve enjoyed in McAllen and taking it down to El Paso and, and maybe further locations down the road, I think it’s just a reflection of how, how well we, we worked together, and I, I really appreciate the guys over at Windstream.

Joe Scattareggia (05:41):

Yeah. No, and it’s, and it’s, it’s, it’s funny you mentioned that because Mike and, uh, Mike’s great, Mike runs our international group, Mike Crimmins does, and uh, he gives you guys a lot of credit for helping us develop that, those, that market down there. Uh, you know, that with joint trips to Mexico and customer introductions, uh, and, and really as we started to develop that market down there, uh, you guys really helped us with, uh, in a lot of different ways. Um, and then obviously, you know, McAllen to, you know, spread out to El Paso, and then we also um, you know, built our own fiber when we turned up the West Coast and we wind up having a relationship with, with MDC up in El Paso, which has also been another great border crossing, um, market for us.

Joe Scattareggia (06:20):

So, you know, we certainly appreciate that. And again, we value the, the, the partnership that we have together, right? Because if we’re successful, you’re going to be successful and vice versa. So, so real quick, how do you help your customers get connectivity from your, uh, from your International Fiber Crossings to key, to other key data centers in the US?

Juan Salazar (06:39):

Probably one of the best mechanisms that we have is, is what we call our marketplace, and, and the marketplace is really just a, uh, a digital tool that we developed. And I know most data centers have, um, some kind of a marketplace, maybe ours turned a little bit different in the sense that we actively look for opportunities for our customers, be able to buy or sell on that marketplace, and, and we put those deals together, or the two, the two parties together. And, and maybe what’s a little bit different spin for us is that we don’t take any commission and we don’t sign any agent agreements, because I guess for me it’s always been if you’re benefiting in any way from somebody getting, uh, an opportunity, um, you’re, you’re going to have a bias, uh, we’re all human and it just happens.

Juan Salazar (07:29):

So I made that call a long time ago, that’s the way that we help customers. As I said before, we don’t sell any transport services, rather we bring in, uh, great networks like Windstream and tell our, our customers that are looking for that transport, hey, here are the options, you pick, uh, you, you do your evaluation. And, and I think that’s great because, uh, it allows us to impartially generate uh, leads or opportunities, and then let you know the kind of the, let the best man win, our best person I guess I should say.

Joe Scattareggia (08:07):

Yeah. Yeah. I, I, you know, everything, and even in your opening you mentioned, and, and again just now you just mentioned carrier neutral, right? I think that’s a key thing. And, and, and so you talk about pricing and you talk about, you know, being the neutral third party that enables customers to make, and, and vendors, right? We want neutrality too from a vendor standpoint. I don’t want, you know, to be in a data center or being, you know, in some sort of, um, some sort of landing station where I have, I, I don’t have a neutral playing field so to speak, someone that has the edge. So I, I certainly appreciate the value of neutrality. And, and other, and any other benefits that you can think of being, you know, of you being a neutral data center versus a nearby data center, there’s a lot of big data centers, you know, all around, uh, the area, uh, any other benefits that you can see?

Juan Salazar (08:53):

So, yeah, I think, uh, first, first and foremost, it’s definitely neutrality. Now, there are, uh, different definitions of neutrality. So I guess to me neutrality means no competition, because, you know, there are some, some other players out there who would, would say they’re, they’re neutral, but as to certain things, I think for them neutrality means, okay, you can connect with, you know, wherever you want, but maybe not necessarily on the same terms. Um, so I think that’s, that’s really our, our benefit.

Juan Salazar (09:25):

The other thing that I think because of our niche and, and focus is being able to connect to all the Mexico networks in one location on the US side of the border, I think that’s something that’s great. And also because those same networks, um, the, the Mexico networks that is, this is their, uh, what I like to call their Northernmost uh, core pop. So this is not just a, a pass through location, they have core network gear, uh, in our locations, and that’s really the origin of the, um, of the IFCs. They were built to make it easy for carriers to come into our facility with a one-stop shop. Um, so I think maybe that’s, that’s maybe our, our, our real benefit or, or part of our value prop.

Joe Scattareggia (10:15):

Yeah. And for us, I mean, having that, that obviously a relationship and having, you know, a, a, a neutral position in, in a, in a, in a, in a great spot and a great partner helps us because as you probably know, we have, there are many of our acquisitions over the years have deep fiber, you know, in and around, uh, you know, Texas and certainly some of these areas, so it’s been beneficial for us to, to kind of take that, light it. And early on, we lit McAllen and it was one of our big success stories, you know, in terms of lighting it and filling it up with customers that needed capacity, lift capacity to various parts of the country. So moving on, where do you see the border crossing business going, like, and what, you know, where do you see the future of, of the subsea cable landing space, and are there any projects that you or, or the team are looking at doing in the future?

Juan Salazar (10:58):

So we just recently, uh, turned up Nogales, Arizona as a, uh, as a new border crossing, you know, with, uh, uh, carrier neutral data center. Um, so that one is, is up and running. And next on our list is San Diego. So I think there’s, uh, uh, we’ve had demand for, for San Diego. It was actually on the roadmap before Nogales, but Nogales kind of just came up in priority, our customers really, uh, needed that, and we just refocused to that, but now that that’s been completed, uh, we’re moving to San Diego.

Juan Salazar (11:35):

So I think that’s probably the, um, the next location that you’ll see, um, turn up. And, uh, um, past that maybe we have had uh, customers ask us for, for Eagle Pass. So I think if anything, Eagle Pass Texas is, uh, maybe down the road for us, but for us it’s really just focused on the border. So wherever those key crossings exist, um, that’s where we’re going to be. I like to tell my guys that we’re trying to build from the Gulf of Mexico to the Pacific Ocean. And, uh, so it helps to have that focus because it allows you to say no to maybe other opportunities that, that, you know, kind of shiny things. So, uh, I, I like having that clarity.

Joe Scattareggia (12:23):

Yeah. Yeah. And look, it’s, it’s, it’s good to have focus, and you guys are focused on your niche, which is the, as you said, the, the International Fiber Crossings and you’re good at it, which is great. I know we’ve had some discussions with you about Nogales and I, I’m sure we’ll have other discussions. Our fiber does run through San Diego, so I’m sure there’s other discussions we’ll have along the way about some of these, these other markets that you’re looking to uh, potentially go into. Mo- moving on, do you see customers with the need for diversity, uh, for, for, for diverse routes out of these locations that you’re in right now, McAllen and El Paso, you know, a customer is looking for diversity and looking to avoid certain markets?

Juan Salazar (13:00):

Absolutely. Uh, so I mentioned earlier in the conversation that, uh, I think Windstream has a great offering. Speaking about the Valley or McAllen, being able to come in and out of this, of South Texas in two different, uh, paths that are about, you know, 300 miles apart, I think that’s, that’s really beneficial and could be even with those two routes we’ve seen, uh, other networks have, uh, like a double cut, and so it’s always great to have diversity. And more and more, it’s becoming a, uh, like a deal breaker. Um, I see our customers asking for that, you know, two paths, even three paths or routes out, um, out of the facility. You know, we try and help and accommodate wherever we can, uh, bring, you know, networks together, but it’s absolutely something that’s really important. And in El Paso, I’ll say that being able to go from El Paso to say Dallas and then Phoenix, um, I think those really line up with the, um, you know, the bill that, that Windstream has been doing over the past few years.

Juan Salazar (14:06):

So I think that’s great. I see a lot of demand from, uh, from El Paso to go on to, uh, Phoenix or San Diego, same thing with Nogales. Nogales has a, um, a route that goes up, uh, Phoenix, and then from there, it’s kind of to get to San Diego or LA. So I think more, where you’re going to see more of that and being able to have a wide network over the country the way that Windstream has built theirs, um, I just, it drives that peace of mind, which end of the day that’s what everybody’s looking for, right?

Joe Scattareggia (14:37):

Yeah, yeah, of course. Uh, you know, when you, you know, when you build these networks and you’re building the right way, you know, w- when there is an outage and there will be outages, right? And I mean that, that’s-

Juan Salazar (14:47):

Mm-hmm (affirmative).

Joe Scattareggia (14:48):

… let’s face it, but there’s a lot of construction going on in the, in the country, when they build roads and lots of things happen. But when you build the route and you build a network with diversity, and you mentioned, you know, McAllen, yeah, we go out through Houston, we go up through San Antonio. So for us we have deep fiber in there, and we’ve, you know, we’ve, we’ve, we’ve built uh, a lot of our systems with diversity, so you get a lot of that. But at the same time, you know, you talk about diversity, you talk about tri-versity, it’s all a matter of, you know, does a customer want to pay for that? And usually they do. I think the smart ones understand you have to build, you know, these networks diverse- with diversity just in case. So moving along, is there anything else, uh, that, that is worth mentioning, uh, in terms of the business, anything around, anything that you want to discuss before we, uh, we call it a wrap?

Juan Salazar (15:29):

We were talking about, you know, how these things are important, the route and the diversity. I think it’s becoming more crucial because we’re seeing more and more interest from content providers, gaming, cloud, content gaming, hyperscalers in general. And I think, uh, they are willing and they recognize the value of having that diversity, and more and more we’re seeing that. So I think uh, that’s where it’s, it’s, we see a lot of this growth.

Juan Salazar (15:53):

And of course really COVID has just accelerated that. I’ve talked to more than one uh, of our network customers that have said that their five-year plan just became this year’s plan. So we’re seeing uh, a lot of growth for our customers, us as well, but, you know, I think that’s, that’s just a reflection of this new reality that we’re all getting used to, you know, having to work in a, in a remote fashion where maybe it’s always been optional, but now not so much. So, that demand in, in bandwidth is just growing exponentially, um, at least we’ve seen that this year, it’s, um, almost operating, you know, around the clock. So, anyway, I, I guess that’s the last thing I would add that-

Joe Scattareggia (16:36):

Yeah.

Juan Salazar (16:37):

… I think that’s going to continue on for a while.

Joe Scattareggia (16:39):

Yeah. And I, and I agree with you. So we, we’ve seen a lot of the, the bandwidth demand that’s, that was put when you have a lot of the, the work environment went to the home and, you know, so then you have the consumers wanting more bandwidth, they want more bandwidth and either new connectivity or, or, or greater speeds. And then the corporate networks, when, when the corporate networks were shifted to, you know, remote working, the VPNs had to be expanded and, and just the, the entire profile of the internet traffic shifted. So we did, and we were fortunate to see a lot of that uptake in demand, and, and I agree with you, I, I think the world has changed forever. Um, I think you, you had a lot of companies out there that, uh, didn’t really understand the concept of working remote that were forced to have their employees work remote, and as a result of that, they were able to test if it works or not.

Joe Scattareggia (17:26):

Uh, and it does work and, you know, I’m sure you talked to a lot of your neighbors and, you know, some other colleagues that it does work. Now, we’re fortunate that you have an existing relationship that you can continue to build over Zoom or video. You know, I’m not sure you can build the same types of relationships if you’ve never met someone in the past. But, you know, I do think the world has changed and, and the way we consume bandwidth and, and how we work uh, in the marketplace has certainly changed forever. You could call that good or bad, but it certainly changed.

Juan Salazar (17:55):

I, I agree entirely. And I think we saw it this year with ITW. So I think last time we met up, uh, was at ITW in Atlanta and, uh, you know, that, and that’s great, even if it’s once a year, you’re gonna kind of touch base, but I agree entirely. I don’t think it’s something that can be de- you can’t develop a relationship, uh, just on, on Zoom. So I hope that, well, I look forward to the day when we go back to at least having some kind of human interaction. (laughs)

Joe Scattareggia (18:22):

Yeah. I, I agree. And I, I think over time you start to value the, um, the conferences to be quite honest, um, you know, where we can accomplish a lot, you mentioned ITW, there’s PTC, there’s a number of these conferences that with the one short trip might be two or three days, you can accomplish 50 to 100 meetings, and the meetings that you have a meal with someone, or you meet someone in the lobby or at the bar area, you can accomplish a lot just by uh, interaction. And I think that’s people realize the value of these conferences now that you don’t have them. So I look forward to them coming back as well. Well, Juan, I appreciate you joining us today and uh, I hope uh, everyone got some value in our discussion. Juan, hope to see you again soon at maybe one of these conferences, and thank you again for uh, for joining Connect the Dots with Windstream. Thank you everyone.

Juan Salazar (19:07):

Yeah. Thanks for having me.

Joe Scattareggia (19:09):

You beet.

Outro (19:11):

You’ve been listening to Connect the Dots with Windstream Wholesale. To learn more about Windstream Wholesale, visit www.windstreamwholesale.com. Be sure to subscribe to the podcast on Apple Podcasts, Google Podcasts, or wherever you listen to podcasts. Thanks so much for listening, and we’ll be back soon with a new episode.