Up From The Ashes

Part of what used to be GST Hawaii is now Pacific LightNet.

January, 2002

Pacific LightNet’s Pacific Guardian Tower offices are humming. On this day, about a dozen employees from Brigham Young University’s Hawaii campus are wandering through. Pacific LightNet acquired BYU as a major customer in late 2001, ran fiber-optic lines to the Laie campus and is providing high-speed Internet and voice services. The two organizations are exploring other ways they might work together.

Pacific LightNet’s President and Chief Operating Officer Rob Volcker declines to put a price on the BYU contract, but characterizes it as “substantial.” It’s Volcker’s second time around as David taking aim at Hawaii’s telecommunications Goliath Verizon Hawaii. Pacific LightNet Inc. recently acquired the Hawaii assets of Vancouver, Wash.-based GST Telecommunications, and Volcker had been GST Hawaii’s vice president for Pacific Rim Operations from 1995 to 1998. He says he disagreed with GST’s lack of focus on the Hawaii market at the time and left to do consulting on the mainland. Early in 2001, he was contacted by former GST Chairman John Warta, whose NextNet Investments LLC eventually purchased the GST Hawaii assets in partnership with TM Communications Hawaii LLC, a subsidiary of Japan’s Tomen Corp.

Volcker had kept a home in Hawaii and says he simply got off the plane, went back to his house with the car still parked in the garage, opened the door and went straight to work the next day. “The first order of business was to stabilize the business. We wanted to get our arms around the records and clear up any long-standing issues,” he says.

The next order of business was the market growth phase, and developing new products for 2002. Volcker says he hopes to grow revenues by 10 percent to 20 percent in 2002 to hit a goal of $18 million. A number that is admittedly dwarfed by Verizon Hawaii’s (No. 10 onHawaii Business’ Top 250 listing) nearly $639 million in gross sales for the year 2000.

Verizon Hawaii declined to comment about Pacific LightNet’s plans, but Ann Nishida, media relations manager, says, “Competition has been a fact of life for Verizon for many years. Verizon Hawaii is in the unique position of being able to offer customers bundles of services at competitive prices. Our success in the market is mainly due to customer awareness of our high quality of service.”

When Pacific LightNet acquired GST’s assets, it got 3,000 Hawaii telephone customers and 14,000 GST Hawaii OnLine customers along with telecommunications hardware and an interisland fiber network. Volcker says the company retained about 35 (most of) GST Hawaii’s employees and has added 25 more since then as service and billing functions have migrated here.

He’s looking at growing those customer and employee numbers this year and is zeroing in on the “downtown ring” running up Alakea and down Bishop Streets, which passes a number of multitenant high-rise buildings. He notes that GST probably pulled about 500 kilometers worth of fiber through the Islands, but didn’t make a lot of 4 building entries.

Volcker says, “The interesting thing about a down economy is that folks who may not have looked at a telecommunications alternative provider when things were pretty good are now looking at ways that they can save money, and we think we’re pretty good at that. We think we can show most customers who we talk to approximately 10 percent to 20 percent savings on their telecommunications bill.”

He’s also banking on the belief that all business is local. Says Volcker: “If local businesses are concerned about keeping their money in the state, particularly in these economic times, they might want to take a look at us.”

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Kelli Abe Trifonovitch