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Zayo Group Scoops Up MSP SD-WAN Specialist QOS Networks

‘We’ve kind of been the darling of SD-WAN for a while. We wanted to get a lot of bang for our buck for our customers,’ MSP QOS Networks CEO Frank Cittadino tells CRN regarding the deal.

Zayo Group Holdings has bought SD-WAN-focused MSP QOS Networks in a move that will position the company, known for its communications infrastructure, as a provider of secure edge networking services, the two companies said.

“We feel this is a move that will help us bring the edge to core,” said Brian Lillie, chief product and technology officer for Boulder, Colo.-based Zayo.

The acquisition will couple Zayo’s fiber network, as well as its optical and packet capabilities, with QOS’ managed SD-WAN, security, edge analytics and network automation, all of which can be layered on top of Zayo’s extensive infrastructure, the two companies told CRN.

Via the terms of the deal, the QOS brand will be retained and operate as a division of Zayo. The two companies did not disclose financial terms of the deal.

[Related: The 10 Biggest Telecom News Stories Of 2021 ]

Zayo has been growing its enterprise focus in recent years but realized that in addition to on-net and near-net connectivity services, the provider needed to invest more in SD-WAN and edge managed services.

Zayo has an existing relationship with Versa Networks for SD-WAN, but it wasn’t at the scale that the company needed to serve enterprise customers, Lillie said. “We looked at build, buy, partner models … We talked to customers and found QOS. We understand the need for over-the-top, white-glove services. It became really apparent that the combination of QOS and Zayo will create a significant platform for the enterprise and for us to aggregate into the cloud,” he said.

Irvine, Calif.-based QOS Networks was launched in 2012 with a single focus on managed SD-WAN solutions. The MSP offers SD-WAN hardware and software solutions, including VMWare’s VeloCloud ; Palo Alto Networks’ Prisma, based on CloudGenix technology; and, like Zayo, Versa SD-WAN.

Zayo customers will now have access to these additional SD-WAN providers via the new deal, the companies said.

“Just like customers want multi-cloud, they want choice in terms of the SD-WAN technology they deploy,” Lillie said. “Now, not only are we going to give them a technology choice, but we’re giving them a choice of a fully managed or co-managed [solution], which Zayo really couldn’t do before.”

QOS’ solution offers flexibly and specialization, two big asks of enterprises, while Zayo offers the network, said Frank Cittadino, CEO of QOS Networks.

“We’ve kind of been the darling of SD-WAN for a while. I didn’t want to sell to a company that had a bunch of SD-WAN in place or a legacy MPLS conversion going on or a product that was already completely designed and built. We wanted to go to a company that [would allow us] to drive incremental value to our customers, and Zayo allowed us to do that,” Cittadino said. “We wanted to get a lot of bang for our buck for our customers.”

Channel-first QOS Networks will also help elevate Zayo’s own partner focus, Lillie said. “I don’t believe we have had the same level of success in the channel that QOS has had—we’re largely a direct sales force. So again, it is a great fit,” he said.

In addition to targeting enterprise customers, the tie-up will help Zayo and QOS build bonds with hyperscale cloud providers investing in the edge, multitenant data center providers investing in the core, and carriers investing in fiber-to-the-tower (FTT), the companies said.

Zayo Group in 2020 was acquired by global investment firms Digital Colony Partners and the EQT Infrastructure IV fund in a deal valued at $14.3 billion.

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