A lot has happened in the last year. I guess I wanna start with something we were just talking about in the prior session, about there's a lot of new faces in leadership positions in the tower industry. Steve is one of them, your new CEO. Kinda maybe just at this juncture, what is Steve doing with the organization that's new and different, and you'd like people to know?
Sure. I think, so he started in April, and one of the things that the board had talked about in choosing a CEO was that historically they had for the previous two CEOs, promoted the CFO into the role.
Mm-hmm.
Which gave the indication that it was more of a financially driven thought process than an operationally driven one.
You mean-
No. And they thought that this time around it would be better to have somebody who had significant operating experience, particularly with regard to the tower business. Given that that is where the majority of our cash flow, and revenue, and value resides, that having somebody who has a lot of experience there, they believed was important to driving the best outcome, the most value for the stock. And they found Steven is that person, and he has come in and focused more on how to do things, what the process is, how to get cost out, how to be as efficient as possible across the board, more so than it had been the case previously. Obviously it's a spectrum. It's not a point.
It's not like somebody does only one thing, but he is more focused on operations and cost management than was Jay, who was more focused on the strategic view of where we were going and the future of the business. And as we're in the middle of a strategic review, I think Steven has taken to kind of focusing on what is controllable, how do we do what we need to do now to set us up for the best possible outcome of that review. And what I have found very impressive about our workforce is that, as you pointed out, there's been a lot of change at Crown Castle over the last twelve months.
We, almost twelve months ago, a little bit more, had a reduction in force that was related to the tower side of our business because we had had a significant amount of tower activity and it came down. We then had, you know, including an interim, we had three CEOs within four months.
Mm.
We have a strategic review, and then we had a reduction in force in our, the network side, the fiber side of our business, based on some of the changes we had made as part of our operating review. That's a lot for any organization to go through, and yet we gave guidance in October of last year, and other than the purposeful changes we've made based on making some different decisions around capital allocation and how that may impact our business, we have met all of that guidance.
Which means that everybody has stayed extremely focused on making sure our customers are cared for, making sure that we are doing things as efficiently as we can, controlling the cost structure of the business, and performing such that we generate the revenue growth we thought we would need to in order to generate the FFO per share that we had projected in our outlook. And the fact that all of that has happened, I think is remarkable, because it is a tremendous amount of change, and it's hard to run a business, and it's hard to run a business in good times, but when you add all of the change to it, I think it's even harder.
I think Steven has been very good at making sure everybody understands what the goals are near term for us to be focused on, and been very good about ensuring that nobody gets a feeling of, "Okay, this isn't a good place because of all this change." I think he's done a good job kind of calming the organization down, as did Tony, as our interim CEO. I think it's been a very positive transition, and having somebody who is focused on how do you get better, how do you make sure the process is the best it can be, is something that I think was very healthy for Crown Castle.
And I think that as we go through the strategic review and ultimately figure out whatever that outcome is, those thought processes will be very good for generating value going forward.
We'll get to the strategic review, and you can say you're not gonna tell me anything in a bit, but-
I can just say that now.
No, no, that's, that's more of a-
I'm not gonna tell you.
... It's more a mid-conversation type of nugget.
You just not say it? Well, it's okay.
But so look, I think that the thing, you know, that the tower investors, you know, see is the value that's inherent in the tower stocks, reflective of the tower businesses. But at the same time, there's also, you know, kind of a lack of understanding or conviction that the carriers are going to quickly ramp up spending, and so people are trying to like, you know, sit back and consider, look for green shoots. Do you see any green shoots in carrier spending and activity that, you know, gives you optimism about 2025 versus 2024?
When we gave guidance in October last year, we thought that we would get about 4.5% growth in 2024, and that's exactly where we have been thus far and what we continue to see going through the remainder of the year. That is to say, in order to answer your question, we don't see any change, or we would've announced some sort of change in that outlook, and looking into 2025, we'll give outlook again in January, but what we are encouraged by is that there is more conversation now from our carrier customers about their need to invest in the network than there has been in some period of time. What is difficult for us is always translating that discussion into what is going to happen for tower leasing.
Because even in periods where they, historical periods, as you know, announce what their wireless CapEx was-
Mm-hmm.
There was very little correlation between their wireless CapEx and our leasing activity.
Mm-hmm.
Because the timing of when something goes on a tower is different than the timing of when all the CapEx happens, and sometimes it's faster and sometimes it's slower. So we haven't actually been able to pinpoint the actual inflection points very well. But it does give us this kind of move towards more discussion around investing in the network, gives us confidence in our ability to grow the business over a longer term, which is what we've talked about is through 2027, we think we'll get mid-single digits growth. We think that that's it's still a very good estimate of what's going to happen for us, partly because all of the growth comes from our carrier customers investing more in the network, and they're talking about investing more in the network.
What has historically happened, as we've talked about, is that one driver of significant growth in the tower market is a generational upgrade in the network technology. So going from 3G- 4G or 4G- 5G. We look back on the 4G cycle that we had 10, 15 years ago, and we look at the 5G cycle we're going through now. There's a big wave, and then that wave kind of dissipates, and we come down to kind of a natural level of spending. But all through that period, 5G has been more growth for us than 4G.
And that gives us a lot of benefit to look forward and say we feel good about where we are now and what the trajectory of the business will be over a long period of time, but can't speak to a specific inflection point that will happen in any given period.
Mm-hmm. I think when you were here last year, we were talking, I think, at the time was around 5% growth, and then later you guided to the 4.5%. But I think what you said at the time was that you had kinda 90% visibility into that 5% at the time. And that was informed by a combination of the conversations, as you say, with the carriers and the MLAs that you had. And the theory was that as you went further out, the 90%, the portion of the 90% that was informed by the MLAs would kinda fall, and the portion that was informed by the conversations and actual activity levels would grow.
So as we think about next year, do you have as high a conviction based on the MLAs, that you can grow this level or faster on a go-forward basis? Or is that conviction lower because the MLAs aren't as much there, and the conversations are more a piece of it?
So I doubt I said what you just said.
Pretty sure you said what you said.
Because we would have said 75%, 90%, not 90%. And what we said was that over the course through 2027, 75% of our growth was contracted. I don't think I ever said that we thought that we had 90% conviction due to conversations. I really don't. I'll be happy to go back and look. If I did, I would hope. I would tell my prior self not to do so. But that 75% still holds.
Okay.
And there's always going to be additional growth that we have over and above what we have contracted that comes from conversations with carrier customers as well as other customers. The kind of customers outside the Big Four now that make up, you know, twenty-ish% of our growth at times and, or, our revenue at times. And so I think what we can see is that there's always paths to grow more than what we have contracted, and we have 75% of that 5% contracted, which is why we think that 5% still matters. We think it still is very much what we think will happen through 2027. And like I said, I feel enthusiastic about the conversations that our customers are talking about publicly.
I mean, I heard Verizon talk earlier, how they're saying: Yeah, we think we're gonna increase the amount of investment in our business, to take care of the demand that they're seeing on their network. And that is great for tower companies. And what has always been a good position for tower companies to be in and where we have grown substantially, other than the generational upgrades, are when our customers have access to spectrum and when there is competition for network quality. And that's what it feels like is happening right now. And even what I heard from Verizon this morning was, "Yes, we see...
You know, we put a lot of C-band into our top-tier markets, the Tier One markets, but there are a whole bunch of other markets we need to go after at this point." That's great for us, and our peers as well. It's all good things to have happen that give us the ability to say that through twenty twenty-seven we feel good about our growth. Like I said, though, what is always difficult is to try to translate exactly those comments into the time period in which the leasing for us is going to happen.
Both because we have structured MLAs that may or may not allow us, depending on what's going on, that the specific activity to be monetized, because we've monetized it as kind of general activity, or because we just don't know when the timing will be, and what we think we've done a good job on in structuring our the agreements that we have with our customers, is that when... Again, when you look at the 5G cycle versus the 4G cycle, we have the low watermarks are still higher in 5G, so we've been, when things have slowed down, we're still growing more. 4.5% this year is still better than it was at this general cycle in the 4G cycle, general time in the 4G cycle.
The upside wasn't cut off, so we still grew very well when that 5G cycle ramped up in 2020, 2021. We grew 6%, 6.5%, which is more than what we did in 4G. So we think we've structured good agreements with our customers that allow us some protection on the downside without cutting off the upside. Which gives us, again, conviction in what we think will happen over the next several years.
... And so I guess there's a couple, you know, events. You mentioned one, so Verizon's gonna have some sort of event or announcement to kind of elaborate on what their next phase of fixed wireless access will look like when they kind of move C-band out to the tertiary markets, finish the secondary, move to the tertiary markets. We're gonna have T-Mobile later this month have a Capital Markets Day talking about probably all the great things they wanna do with their network. Are these conversations or these events contemplated in the MLA, or are these kinds of events the upside that you're speaking about?
It depends on the agreement, and it's a bit of both. But I think over a long enough period of time, we understand what the value is of our tower space, and we get compensated for that value. We monetize that value. And I think you can see that somewhat in, we have one peer, SBA, who does much less MLA, much less of a pricing structure and more by the amendment pricing structure. And we have American Tower and we who do much more long-term agreements, where the pricing structure's more evened out than specifically tied to an amendment. But if you look over a long enough period of time, the growth is fairly similar.
and I said this earlier today, it's something that I believe Jeff Stoops said, which was, whether you do an MLA or whether you do per amendment pricing, it's kinda like whether you like chocolate or vanilla. Ice cream's good.
Mm-hmm.
And whether you like chocolate or whether you like vanilla, it's still good. Whether we get paid à la carte or whether we get paid in more holistic agreements, it's all good because that driver of demand is still there. We still get paid when our customers spend on their network, and therefore, we think that cutting off the risk profile is beneficial through an MLA, not capping the upside. But of course, there's gonna be some activity in there that is already put into the cutting off the risk profile that allows our customers more visibility into their cost structure, which is why they do it. So we can't monetize everything, but it is going to be a combination of the two things we're talking about.
I imagine that during the strategic review process, it's probably hard to engage in conversations inorganically, but to the extent that you just monitor the marketplace, I was asking your peer earlier about the inorganic opportunity domestically for towers. Is it—we've heard it's kinda like the private market valuations are very high, the public market valuations are low, and never the twain shall meet. Is that kinda a basic-
Yeah, actually, the answer is yes. The private market valuations are high. I believe the public valuations are low. They're certainly low in comparison to the private market valuations. I don't understand it. It was one of the things that surprised me when I first got into this role, was somebody said that to me, and I was like, that just doesn't make capital market sense. Yes, you get control, but no, you don't have any liquidity. The fact that there's a huge disparity between the private market multiple and public market multiple doesn't make sense from just how capital should be allocated. Because you take much more liquidity risk, even though you have operational control.
It just doesn't make sense to me why it would happen, and I've never been able to make a huge amount of sense of it. I think that my best explanation at this point is public markets have a harder time valuing long-term growth than private markets do, and public markets look for the next two years of growth, not the next twenty years of growth. And when you start talking about growth that's beyond five years, which a lot of the tower valuation is, I think private market investors are willing to give more credit for that growth than our public market investors.
Mm.
That's the best explanation I can come up with. But it is still true. It has been true. I don't think it will ever not be true, from my experience. Like, I've talked to people in this business forever, it's always been true that private market multiples are higher. And I think people's made money. So what I think that says is that towers are undervalued.
That's a good jumping-off point to talk about fiber. What's the latest on the strategic review?
There's nothing that I can speak to here. If there was something I would speak to, we would've press released anything specific.
You could do it after you tell us.
I could.
Okay.
There would be a lot of angry people. It would be my last conversation.
No CEO.
I don't think CFO either. So anyway, these processes take some time because they're complicated. Figuring out what to do is hard. We have had one of the inputs that I think of when thinking about what is the right outcome for us. The way I would say the right outcome is, we need to generate the most value for our investors that we possibly can. One of the inputs into figuring that out, though, is what do our investors want, and what do they think? If I get in a room with five investors, it is rare that I would get less than three opinions on that point. In addition, the investor feedback changes over time-
Mm
... as well it should. If investors thought the same thing they did every year, then they would never be good investors, right? Things change, therefore, opinions change, investment profiles change, and investment decisions ultimately change. And what we have seen is that not only is there a difference of opinion among investors, there's a difference of opinion with an investor over time.
Mm-hmm.
That adds to the complexity of what does it mean to drive value? Because if one person thinks I'm gonna use numbers that don't matter here, so that you don't make me say anything. If we were to sell something for a dollar and somebody was really excited about it, or sell something for four dollars and somebody was mad about it, did we drive value? It's really in the eye of the beholder, and that's part of what makes these things somewhat difficult, is how do you make sure that you're driving the best value you possibly can? I know from all the conversations we've had, is that our board is informed and engaged, and they are looking at everything they know how to look at, and they're doing an exceptional job of keeping engaged in this conversation that we're having.
And they're gonna make a good decision. The difficulty is gonna be, some of the investors will behold it as not a good decision. That's just the way it is.
Mm.
Whatever it may be, because we've gotten so many different inputs at that point, and I think that's part of what's adding to the complexity of the conversation. Because there are. I think as the board has said, they're looking at, you know, basically all the options that we could look at, whether it's a sale or all or a portion or one piece of the business or not. Those are all on the table, and I think those are all things that they need to consider.
Let me ask this question: Are the fiber services and the small cell businesses divisible, either physically or virtually from each other?
So I think the answer to that is absolutely they are. Separating the businesses operationally can happen. I think the question underlying the strategic review is whether it should happen. That's a much more difficult conversation. But can we separate the businesses? Like, can we have people who operate this business and people who operate this business? Absolutely. No doubt about it. I do think that again, just because you can, doesn't mean you should.
Do you or does Crown believe that these two businesses are more valuable together than apart? Because my recollection was that, you know, there was always a, frankly, I don't know, I'm gonna exaggerate, but it always seemed like there was an apology, as, you know, Jay was buying all these businesses in fiber because he was like: "Look, I gotta buy the fiber business in order to get where I wanna go on the small cell business." It was a, it was a necessary evil. It wasn't, "Hey, I love the fiber services business, and I can't wait to have a NOC and salespeople and, you know, 10% churn." That was never what Crown was interested in, right?
It kinda seems to me that it's the obvious answer is that the two businesses, you know, that the fiber services business, if it's gotten the small cell business to where it needs to be, is no longer a necessary part of it. Would you disagree with that?
Disagree would be way too strong of a term. I would say that. To me, the argument you just made had some incongruity to it, which is, you say that we got into the fiber business because it was necessary to do the small cell business well. But now that we have the small cell business where we want it to be, then we don't need this other thing. It isn't because, like, there was some point in time where the small cell business will have been matured enough that it can then stand on its own. That was never the issue. We never bought fiber businesses so that we could add heft to the small cell business.
We bought fiber businesses because the fiber that we targeted was the fiber we thought was necessary and would be necessary for small cells in the future. So we aimed at the top markets in the U.S., we aimed at high-density fiber, meaning lots of strands. We aimed at high-density fiber, meaning under lots of streets, and high-capacity fiber, meaning lots of strands. We passed on a bunch of fiber that was sold in the period because they didn't have those characteristics. Those characteristics still hold true, that the underlying asset of the fiber is utilized for both small cells and enterprises.
Well, I agree, and if you agree, though, that they're divisible from each other, again, you didn't... You had zero fiber, and then you bought a fiber services business so you could get to the Crown Castle small cell business. Now that you have a Crown Castle small cell business that uses some of the fiber, the rest of the fiber services business, which was bought only to get you to the Crown Castle small cell business, is no longer necessary, correct?
Yeah. So, we had a small cell business before we did any of that. So the determination wasn't that we needed the fiber solutions business in order to be in small cells. The determination was that we could generate a better return if we had them together. And if, because it's the same asset, if you're passing this building, because we built small cells down Sixth Avenue-
Mm-hmm.
Why not build into that building and get more revenue? You've already spent the money on the capital, all the money on the fiber. That's where the capital went. So generate more return out of that same asset. That was the theory behind it. Not that somehow we bought all this fiber that was necessary only for small cells, and then we could get rid of everything else. Whether that theory is true is a question.
Mm.
So whether it is true that we have added revenue and added return is a question. We get that question all the time from our investors. Part of what spurred our strategic review.
Mm.
Like I said, it's not that we got to a place that the small cell business is now established and we don't need this other thing. We had that before we bought fiber solutions businesses. We had a small cell business that was established and doing quite well. We thought this would accelerate both this fiber solutions business and the small cell business, and generate better returns for our shareholders. That is exactly the question we're trying to answer. I don't think it is nearly as clear-cut as what you said, at all, that we are now at a point where they can be separated and nothing bad happens, or that they have to be together and everything good happens. We are at a point where we need to assess all of those outcomes and figure out which one generates the most value.
Mm.
... and I think there are really good reasons why all of these businesses stay together. That's why we got into them in the first place. I think there are very good reasons why they may not, but that is exactly the point of a strategic review, is to try to figure out which configuration generates the most value. And I could easily see that some investors would say, "I'm a tower investor. That is what I want to invest in. I do not want access to these other things." I could also see somebody say, "I'm a tower investor, and I like the fact that you have growth that is differentiated from your other tower peers." So I don't think anything is as clear-cut as what you just made it out to be. That was what I meant.
There's a little incongruity to your statement in that it's not either/or, black and white. It is the reason we are in this review because there is no clear-cut "This is absolutely the answer." So the question is what do we do to generate the most value, and we are gonna do everything we can to make sure we answer that question well.
So I guess two follow-ups on that. One would be: Is doing nothing an option?
I think everything is an option because, again, we want to generate value. I can't speak to the likelihood of different options. That is something that is a board-level decision that while I have some opinions about, my opinions ultimately don't matter.
So private market valuations and towers inform a view that Crown Castle sees itself as undervalued. Are the private market potential buyers for these assets, not that it's exclusively private potential buyers, using publicly traded fiber valuations against you, in their negotiations? Or are you agreeing on private market valuations that inform the conversation?
Suffice it to say we're all very informed.
Okay. You know the private market valuations, they know the public market valuations, and we're fighting on that.
I can say that anything that you know, we know.
Okay. I think that's usually a fair statement.
Right. I mean, about valuations and things like... I mean, we see everything you see.
Yeah.
It would be hard to say that we don't know what's going on in the market.
One of the aspects of the operational review was kind of taking a new look at the return thresholds for the small cell business. It used to be a starting yield of, I think, 6%-7%, and it went to double digits with the second co-tenant and then up into the, you know, higher teens, I guess, for the third co-tenant. And now you've kind of raised that hurdle. Is that purely a function of interest rates, or is that a function of something else?
It's a function of a few things, but interest rates is one of them. So our cost of capital went up, and we think it requiring higher returns is prudent in a higher cost capital environment. But it is not the only input.
Yeah.
We also, like we were talking about earlier, We were focused as our investment thesis to build out as much fiber as we could in the right markets that we believe would lead to where small cells were going to be, and therefore, our ability to co-locate on fiber we already had. So we were building out to connect new buildings, new small cells that were well away from our existing fiber. Something we would call anchor build or greenfield, whatever conduit. But that was the 6%-7% yield you were talking about, like something new. We were doing the same thing on our...
with the fiber solution side of our business, where we were building out to new buildings, that were not exactly connected to our current fiber. What we determined was through the operational side of our strategic and operating review, which happened kind of on the early edges of it, where we had consultants come talk to us about what the markets were and what our appropriate market share would be and where we could compete well. We determined that there was sufficient demand near our fiber to generate good growth without having to spend the money to go reach out to those new locations.
So what we have done is we've incorporated both higher interest rates and a view of the market to say we have done enough of that build in our past to open up enough of an opportunity that we can still grow our business efficiently, to generate good returns, but do generate even better returns because we don't have the capital involved of building out the greenfield. So what we've done is limited our focus more towards on-net, near-net, both on our fiber solutions and small cell businesses, so that we are building less new build, which should lead to lower capital and higher returns.
What we believe will ultimately happen is, we can grow our fiber solutions business at around 3% a year, which is what we have said and what the first half of the year has been. And we believe we can grow our small cell business double digits on a revenue basis, on an annual growth basis, while constraining the capital more than we had done in the past, because we don't need to build all out right now. We don't see the demand coming fast enough that it's necessary. Part of that operational review solidified our view that this new way of operating could lead to both good growth and better returns.
And because we had been questioned enough by our investor base, and I think rightfully so, about what the returns have been, moving towards higher returns was a good thing. Always a good thing, but there was a justified reason that we were doing the things we were doing before too, because we saw this big market opportunity that we thought we could get to take advantage of if we built out to it. We just now see that we can take a pause on that build-out. We think that there will, hopefully, in the future, be more of those opportunities, but right now we can take a pause on that build-out and focus on harvesting all of the business that we basically built into for the last 10 years.
And we think there's a tremendous amount of growth and return that will be available to us by doing so. It led to a significant reduction in capital, not a huge reduction in growth, and what ultimately led to a reduction in the people we needed, because when you reduce capital, we reduce the people that are building stuff. So all of that happened earlier this year. I would say it has gone as well as we could have expected it to have gone. What I said earlier holds true. The fact that we are, we're performing in line with our plans that we made in October of last year is somewhat remarkable to me. I think that's something that we are proud of. Our employees should be proud of it.
We think that this new way of doing business allows us to generate everything we want to right now, which is we think it'll be the highest value generating course, regardless of the outcome of the strategic review.
One of the things that has, that's come up in conversation has been, you know, the carriers and their appetite for self-perform. Is, you know, you're not in every market, and so there's gonna be a lot of markets where the carriers have no choice but to self-perform, but in the markets where you are, is self-perform an obstacle to achieving multi-tenant returns, or has it become more of a challenge as time has passed?
It has not become more of a challenge as time has passed. I think the answer to your question is somewhat, of course, if one of our customers self-performs, it takes away the ability for us to put that customer in that same location on our existing system. I think that is true. I don't believe that happens more now than it has in the past in our small cell experience. We've been in the small cell business a long time. There was a time at which Verizon spoke about never using an outsourced provider ever again.
Mm-hmm.
Obviously, that has relaxed because they use us, so I don't think it is worse. I don't think that the issue you're talking about is worse, where self-perform eats into colocation. We believe that we can make good money with two tenants. Like you said, low double-digit returns is a good... It's over and above our cost of capital. And as any company, if you can invest money for a return that's over and above your cost of capital, you're making money, and we believe there will be plenty of markets where we get three tenants, and what has been true for us is that even more than in the tower business, the second tenant can be the same customer.
Mm-hmm. Right.
Because the densification can happen on a small cell business where they had two nodes in a location, all of that capacity has been utilized by us using our phones in that area. They need to add another node, same customer, new tenant-
Yeah
... on the same system.
There's no amendments in.
Right, there's no amendment. It's just a new contract. That, I think, gives us a lot of confidence that there is good value to be made in the small cell business. So I've always been, sorry, relatively bullish on the small cell business because I believe the amount of demand that is going to be placed on the network is too high to only utilize towers to supply that demand. I think the questions have been more, Can you make a return, and when is it gonna happen?
Mm-hmm.
The "can you make a return" we're trying to address with, "Hey, we're gonna show you we can make a return on some level by pulling back some of the anchor build and showing you what can happen when we lease up," so much like the tower business maturation process. The timeframe has been probably one of our bigger issues, in that, the amount of spectrum that came to market from 2020 to 2022 in the U.S. was huge. It was more than the amount of spectrum that had come to market in the previous history of the wireless industry. That spectrum got deployed on towers, which pushed out the timing of small cells, which happened at a time where people were already somewhat skeptical, and I think that also led to our strategic review.
Is the timing going to work really well for our current investor base? I think it's important to know that, that just because we may make a decision that, may separate the businesses, doesn't mean that we don't believe in the business.
Mm-hmm.
It just may mean that we believe that it can be better harvested by somebody else. And I think that it's... For us, the question of how much colocation is available is really a question of demand. Do we believe there will be sufficient demand through the markets that we already have small cell systems, that would drive incremental small cells on our, on those systems? And my belief of that, the answer is yes, because we see it in the large markets, that towers are not sufficient. That's why small cells already exist, and if they already exist, they're not gonna be taken out because that capacity is necessary. The only thing that's gonna be more at, more network congestion, means more small cells in those markets. We see that occurring over time.
I think the question is, when and to what extent, and those are the types of things we're trying to get through now.
So on the strategic review, just kind of wrapping up, presumably there's a capital allocation question about that as well. You know, if we keep this business, how much do we spend on it? If we don't, what do we spend on it? There's a lot of questions about whether the dividend is part of that calculation. Is it?
Yeah, I think anytime any company talks about capital allocation, you know, it's a combination of investment, leverage, dividend. Those are all capital allocation discussions, and so yes, the dividend would be part of any discussion. I think the difficulty in trying to address the underlying question of what happens, is that we don't know what's going to happen.
Mm.
It's impossible to speak to a hypothetical, if this, what then? Because this is not happening. I think until we have more clarity on the future business that we will be, it's hard to say anything about any of the capital allocation. I couldn't tell you until we know what that outcome is. But yes, all of those are considerations that we all of course have to take into the thought process. Because again, it gets back to the what I was driving at earlier, is that value is what we're going for. Part of the value that we deliver to our investors today is the dividend, part of the value is the growth, part of the value is the stability, part of the value is differentiation.
We have to consider all of those things. The board, we use a strong word. The board has to consider all of those things-
Mm-hmm.
In order to make a decision that will drive the most value.
So then the last question is just more of the econ question, which is: so the fiber services business has been able to put up some growth in the first half of the year. A lot of companies have not. So I guess kind of two related questions. One is, how have you been able to do it when others haven't? And is kind of the drivers here in any way economy-dependent, as the world is wondering, you know, are we going from high inflation and hypergrowth to hard landing?
Yeah. I think the answer to the first question of how we do it, we have purposely taken a somewhat differentiated position within the fiber, enterprise fiber business. We have focused more on complex situations, multiple colocations, lots of connectivity, lots of capacity, and lots of engineering that goes into it, which takes some investment, both from a capital standpoint, to build the right fiber, and some investment from a people standpoint. But by doing so, we believe we've targeted a lower-churn part of the market, which you can see in our results. We've also we believe, targeted a more consistent growth part of the market, because companies like, I don't know if you're a customer or not, off the top of my head, but probably like Bank of America-
No
... are thinking about, "Okay, we have to grow our business, and this is how we're gonna support it with a fiber perspective." And it's more consistent than a small business. So we believe we've positioned ourselves very well to grow and have less churn than the typical fiber business has over time, and you can see that in our results.
Mm-hmm.
Whether that's economically dependent, I don't know yet.
Mm.
I think there's as much to say that there's going to be more data in the short term than less data necessarily in the short term because of other things that are going on. So, overarching things like AI or connecting data centers. I know I had to get an AI.
You got eighteen seconds left.
I know.
About the AI.
I was thinking about it, too. Whether it is, but more data being demanded in just the industry in general or the economy in general versus the economic output, I don't know how that plays out, but we feel good about where we're positioned.
That's awesome. Dan, thank you so much. Great way to end it.
Cheers.
Cheers.
Thanks.