Spread Networks, a privately held network company today announced that it is going to start selling 250 Gbps service (with 16-millisecond latency for the roundtrip) between New York and Chicago for a fixed monthly fee on a long-term contract plus the cost of optical gear.

Sidera Networks which operates an intracity fiber network in the NorthEast has signed on as a customer for this inter-city network. Spread has made a name for selling low-latency networks. It is particularly attractive to financial firms, but in the future latency is going to become a big deal for companies that offer cloud-based services. In addition, the new pricing model is going to help the company attract customers with more modest means as noted in this quote, with emphasis added by me.

“We are delivering a lit service that provides the scalable bandwidth and operational flexibility of a conventional dark fiber IRU with a much superior SLA and cost structure. The benefits of dark fiber basically come down to flexibility and flat costs.  Our Managed Bulk Bandwidth service provides the engineering and operational flexibility associated with dark fiber along with a fixed operating cost for the service.  However, unlike a dark fiber IRU, which requires a dark fiber buyer to invest millions in IRU fees and optical gear commons hardware, our service limits up-front capital expenditure.” — David Barksdale, Spread’s CEO in company press release.