Fiber Optic Telecommunications Networks: Construction Contracts

I have worked as an attorney for many telecom companies. I also remember well when the Internet bubble burst in the late 1990s. We worked through all of the pain of that period. No doubt my most satisfying job was with Qwest Communications International. Qwest's basic business case called for a network of 18,500 miles, with four 2-inch conduits. Network development, construction contracts, dark fiber IRUs, dark fiber leases, collocation agreements, conduit sales, public...
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I have worked as an attorney for many telecom companies. I also remember well when the Internet bubble burst in the late 1990s. We worked through all of the pain of that period.

No doubt my most satisfying job was with Qwest Communications International. Qwest's basic business case called for a network of 18,500 miles, with four 2-inch conduits. Network development, construction contracts, dark fiber IRUs, dark fiber leases, collocation agreements, conduit sales, public rights of way, private rights of way, railroad rights of way. One attorney did all of those agreements. That one attorney was me.

Qwest began as a division of Southern Pacific Telecommunications Company; i.e., the Southern Pacific Railroad. When the railroad spun off SP Telecom as an independent company, there was an agreement that the telecom company would continue to use the name Southern Pacific for a period of three years. At the end of three years the telecom company would no longer use the name Southern Pacific.

In the early days of the company, MCI Communications Corporation was a very important customer to SP Telecom. The two companies entered into agreements whereby MCI agreed to purchase a conduit in some of the routes that were planned by SP Telecom. As part of those agreements, MCI agreed to advance half of the conduit purchase price even on routes where construction had not yet begun. That was very helpful to a fledgling telecom company that did not have other revenues at the time. Because MCI paid such a large part of the purchase price in advance, SP Telecom and MCI created special clauses to provide that SP Telecom would pay penalties for late delivery. Contract clauses such as these circulate among all companies in the industry. I have found it interesting to see many of these clauses that we created come back at me from other carriers.

MCI owned a microwave subsidiary called Qwest Transmission Inc., which they sold to SP Telecom. So when it came time for SP Telecom to change its name, it was an easy decision just to use the name Qwest. That is how the name Qwest Communications International came to be.

During the course of construction of the network we entered into about 500 construction contracts per year. I created all of the forms. We had a contracts administration department that administered the contracts on a day-to-day basis. They completed the scope of work for each work order. They managed the applications for payment. If any issue arose, they brought the issue to me as their attorney.

The budget for the Qwest network was about $2.2 billion. While we were constructing the network, the company entered into numerous dark fiber IRU agreements and dark fiber leases in order to defray some of the costs of building the network. I created all of those forms, all of the dark fiber and all related agreements, such as collocation agreements. We entered into a total of about $1.7 billion of dark fiber agreements. As a result, we were able to complete that network for a net cost to Qwest of about $500 million.

All of those forms are included here for your use in the three publications that are part of this series. I have used these forms in several other places as well. And I have added some clauses to this book that were not used by Qwest. Qwest did not have any routes that were undersea. And, although the network was state of the art at that time, Qwest did not build routes specifically to provide the lowest latency. Those clauses are new and arose from later experiences.

The area that did not fall within my purview at Qwest was lit fiber services. I have those forms from experiences with other companies.

I have found my career in telecom to be interesting and gratifying. I hope that you enjoy great success in using these forms as well.

JFB