SureWest Eyes WINfirst

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SureWest Communications — operator of California's third-largest incumbent competitive local exchange carrier — last week said it's interested in buying all or part of bankrupt cable overbuilder Western Integrated Networks.

At present, SureWest provides local and long-distance telephone service, Internet access and Web hosting, among other services, to 135,000 lines in an 83-square-mile territory in and around Roseville, Calif.

Roseville is a suburb of Sacramento, where Western Integrated Networks (operating as WINfirst) has built part of its only fiber-to-the-home system.

In March, WINfirst halted construction, attempting to conserve its scarce capital. The company has won franchises in several other cities — including Seattle, Dallas and San Diego — but has scaled back and now serves only its current, small base in Sacramento.

Should SureWest acquire WINfirst, it would compete with AT&T Broadband in Sacramento.

WINfirst president Frank Casazza confirmed the talks with SureWest.

This is not SureWest's first attempt to join the cable business. In 1998, the company, then known as Roseville Telephone, pursued a joint venture with Jones Intercable Inc. or Scripps Howard Cable TV.

It later angrily withdrew its application for a cross-ownership waiver from the Federal Communications Commission. The venture was doomed by 15 months of FCC "foot-dragging" on the application, CEO Brian Strom wrote at the time.

The next key date for WINfirst is May 20, when a U.S. bankruptcy judge in Denver will entertain a motion from the company's creditors to convert its Chapter 11 bankruptcy into a Chapter 7 proceeding. That could force WINfirst to liquidate its assets, rather than negotiate the sale of a working cable company.

In a prepared statement, SureWest's Strom said: "WIN provides broadband services to customers in and adjacent to our service area where we already have fiber in proximity to most households we serve. While our interest is preliminary at this point, our strategy is to leverage our network architecture to become the dominant integrated communications provider in the Sacramento area."

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