OneEighty Networks Inc., the Spokane-based broadband communications company founded and owned largely by Greg Green, has bought most of the assets of a larger, Walla Walla-based company as part of an aggressive regional expansion strategy.


OneEighty acquired the assets of HighSpeed Communications LLC for $1 million, says Green, the Spokane companys chairman and CEO. They included HighSpeeds customer base, central offices, electronic equipment, wireless towers, and other facilities, he says.


Like OneEighty, HighSpeed is whats known in the communications industry as a competitive local exchange carrier. It provides broadband Internet, dial-up, Web-hosting, and private-line telephone services to more than 6,000 customers in an area that includes Walla Walla and the Tri-Cities, Wash., and Hermiston, Pendleton, Bend, and Redmond, Ore. It differs from OneEighty, though, in that it uses wireless technology rather than fiber-optic cable to provide last mile connections to its customers. It employs about 15 people and has annual revenues of about $3 million.


By comparison, OneEighty has 12 employees, about 1,200 customers in the Spokane area, and annual revenues of about $2 million. Its higher per-customer revenue is due partly to the fact that its customers are mostly businesses. HighSpeeds customer base is about 65 percent residential and 35 percent business. Green says thats important because, Weve been trying to move toward a consumer product set.


Also significant for OneEighty, in terms of future growth potential, is that HighSpeed owns licensed wireless frequency spectrum in numerous cities, from Honolulu, Hawaii, to Las Vegas, Nev., and Denver, Colo. OneEighty didnt acquire that spectrum in its asset purchase, but obtained the right to use it as part of the purchase agreement.


Along with the Spokane-Coeur dAlene area, cities in which OneEighty now has access to those 28 gigahertz broadcast frequencies include Walla Walla, Yakima, Wenatchee, and the Tri-Cities, Wash.; Eugene, Salem, Medford, and Bend, Ore.; Moscow, Lewiston, and Boise, Idaho; Bakersfield and Modesto, Calif.; Reno, Nev.; Flagstaff, Ariz.; and Colorado Springs, Grand Junction, and Pueblo, Colo., Green says.


OneEighty bought the HighSpeed assets from a group of owners that includes Walla Walla-based cellular industry pioneer Kyle Mussman, Colorado rural-utility concern BTA Associates Inc., and Reston, Va.-based XO Communications Inc., he says. The transaction was finalized Tuesday, Sept. 30.


Its just a tremendous jumpstart on the southwest region for OneEighty, Green says, referring to Walla Walla, the Tri-Cities, and the previously mentioned Oregon markets. This clearly puts us ahead of the game in terms of serving that region, so were just really excited about this.


The transaction should result in a seamless transition for HighSpeed customers, Green says. OneEighty has retained most of HighSpeeds employees and will continue for now to use the HighSpeed name in the newly acquired markets, although it probably will convert those operations to the OneEighty name later, he says.


Just a few years ago, HighSpeed had a market value of $100 million, Green says. OneEighty was able to buy the assets at such a deeply discounted price because of the ongoing telecommunications market slump, Green says. Given current market conditions, we will continue to evaluate potential acquisitions with an eye toward value and increased economies of scale, he says.


He adds, though, that he believes he has only another 12 to 18 months to find similar bargain-priced acquisition targets before rising values cause that growth strategy to make less sense financially.