Frontier focuses on fiber for future
As Frontier Communications emerged from Chapter 11 bankruptcy on Friday, officials with the Norwalkbased telecommunication company made it clear they expect high-speed internet service — delivered by fiber optic cable — to deliver them from the financial wilderness.
“The focus is on fiber,” said John Stratton, the incoming executive chairman of the board for Frontier, which saw its executive team undergo a dramatic reorganization during the full year it was under Chapter 11 bankruptcy protection. “The goal is to replace our existing copper network with fiber.”
Stratton and other Frontier executives explained the company’s strategy during a call with financial analysts reporting on its first quarter earnings. The company had earnings of $60 million in the three-month period that ended March 31 — a dramatic reversal from the same period in 2020, when the company lost $186 million.
Frontier filed for Chapter 11 protection on April 14, 2020. Prior to the analyst call, it was announced that Frontier had signed a new lease for 48,000 square feet of office space for its headquarters staff in the Merritt 7 office complex in the northern end of Norwalk.
Since entering Chapter 11, Frontier executives had been cagey with state officials about whether the company would keep its headquarters in Connecticut. Even while making the announcement about its renewed lease in Norwalk, a company vice president, Jim Campbell, acknowledged that Frontier executives toured “the market to find the best fit for our firm in the post-pandemic office world.”
“Merritt 7 stood above all the competition” Campbell said.
Nick Jeffery, Frontier’s new chief executive officer, said the company will “aggressively target data products and fiber” going forward.
“Frontier’s purpose will be to become a leader in building digital America,” said Jeffrey, who led a turnaround of British telecommunications giant Vodafone before taking his current job. “We have a lot of work to do, but I could not be more excited about the year ahead.”
He said Frontier plans to:
▶ Install new fiber in 495,000 locations across Connecticut and 24 other states over the next year.
▶ Increase the penetration rate in the markets where the company provides fiber-based Internet service from its current level of 41 percent to at least 50 percent. (Penetration rate in this case refers percentage of customers in a given area that use Frontier’s service compared to the total number of internet service customers.)
▶ Phase out Internet products over time that make use of copper cable to deliver the service.
Company officials did not reveal any plans for an increased fiber optic roll-out that are specific to Connecticut, but said expanding that technology in the state was a priority, along with increased availability in California and Texas.
“We have proven we can win market share where we have fiber,” Jeffery said. “A fiber-centric future for Frontier is feasible and financially attractive.”
The opportunity for the company to grab market share by expanding its fiber optic network has great potential, he said, since fiber optic cable passes only 38 percent of all homes in the United States.
Using fiber optic cable to deliver broadband Internet service is preferable because it allows data to move at higher speeds, according to Lon Seidman, an Essex-based technology expert who reviews products on his YouTube channel, LON.TV.
“Fiber, at the moment, delivers significantly faster upstream performance versus cable (Internet service) and is the better technology over long distances,” Seidman said. “And fiber is more reliable. That will be important for businesses and home workers if they can get enough reach (within the communities Frontier serves).”
But if Frontier’s fiber optic push is to be successful, he said, the company needs to do a better job marketing its availability.
Until recently, according Seidman, the company didn’t have map showing where fiber optic service is available in Connecticut, even though it has been marketing its availability online for months.
But installing increased volumes of fiber optic cable “is going to be an expensive proposition,” he said. And because of the expensive involved, Seidman said it is likely that the first areas to get the new fiber optic cable installed will be more densely populated.
When viewed in the long term, Jeffrey said fiber optic cable is more cost effective than a copper network.
“The fiber we are laying now will last for up to 50 years and will cost less to maintain,” he said.
Jeff Kagan, an independent telecommunications analyst based in Atlanta, said regardless of the expense involved, Frontier has no choice but to forge ahead with its plan if the company wants to continue to exist.
“The future is about the Internet: Every thing will be coming over the Internet, whether it’s delivered by wire line or wireless,” Kagan said. “This is the direction they (Frontier) have to move in. They have already waited too long to pull the trigger.”