Frontier says fiber buildout successful
Frontier Communications cleared its first full year since a 2021 bankruptcy with a $441 million profit, as the company passed the halfway point toward its initial goal of stringing fiber optic cable past 10 million homes and businesses in 25 states that represent possible customers.
Frontier lists its headquarters in Norwalk, though CEO Nick Jeffery and a majority of Frontier’s other senior executives are based in the Dallas area today, according to their LinkedIn pages.
As of October 2022, Frontier was the eighth-largest broadband provider in the United States, as reported by Leichtman Research Group, with Comcast’s Xfinity service on top followed by Charter Communications based in Stamford with its Spectrum offering.
Under Jeffery, Frontier has been building out fiber optic lines in a race against cable broadband companies to include Altice USA’s Optimum brand in Connecticut.
Frontier Internet revenue continues to grow but not yet at a pace to offset declines in telephone and subscription TV service, with overall sales down 7 percent in the fourth quarter to just under $1.44 billion. Frontier has been trying to reduce a previous reliance on promotional pricing and giveaways to get new customers to try the service.
“It’s very clear that two years ago, through bankruptcy and before, Frontier had a troubled brand, and it needed to compensate for that with pricing and promotion tools,” Jeffery said Friday on a conference call. “We’re moving — inch by inch, yard by yard, mile by mile — to repair the brand and to charge what we think is the right price for the best product in the market.”
In its first full year postbankruptcy, Frontier reported nearly $5.8 billion in revenue. Frontier continues to see its debt load rise along with interest rates — the company tacked on $1.1 billion to long-term debt that does not come due for several years, pushing the total to $9.1 billion.
“For an average household with multiple 4K TVs, gaming stations, five or 10 or 15 (wireless) devices and so on and so on — if fiber is available, you will take fiber,” Jeffery said during a Friday morning conference call.
But on Thursday, Jeffery’s counterpart at Altice USA said his company is also making gains with fiber.
“Our trends across the New York tri-state area have also improved as we gained traction with our fiber investments,” said Altice USA CEO Dennis Mathew on a Thursday conference call. “I do think fiber is the best technology.”
In Connecticut last year, the company paid $60 million to settle a lawsuit brought by the office of Attorney General William Tong over its fees and marketing practices. And Frontier settled an investigation by the state of California and the Federal Trade Commission after customers complained of internet speeds slower than the company had advertised, paying $8.5 million.
Frontier has broadband operations today in three groups of contiguous states. Florida anchors a Southeast contingent, with another block running from Texas to California.
Executives said Friday that Frontier remains open to adding more territories as it masters the operations and economics of building out fiber, including the possibility of neighborhoods it might be able to reach with federal subsidies to extend broadband to remote areas.
“As you think about where those clusters reside within our broader geography, there may well be homes that don’t require direct subsidization, but when you ‘pass the long throw’ to get to those homes that would be part of the subsidized build, that they suddenly become more addressable,” said John Stratton, executive chairman of Frontier.