After announcing plans late last month to deploy a fiber-to-the-home network across its entire US footprint over the next five years, Altice USA has now confirmed the creation of a new company composed of US-based technical employees to execute on that rollout.
Multichannel News was the first to report on the spinout, also noting that the Communications Workers of America (CWA) union has concerns over how the maneuver might impact employee retention. As part of Altice 's agreement with the New York State Public Service Commission during the process of acquiring Cablevision, Altice agreed not to lay off any customer-facing workers for at least four years. According to Multichannel, the CWA has expressed fears that creating a spinoff company could be a way of getting around that guarantee. (See also Altice Passes Final Cablevision Test.)
However, Altice is making an effort to assure employees that it will not back away from its workforce commitments.
Speaking to Light Reading, an Altice spokesperson said: "We have created a new company called Altice Technical Services USA that will be comprised of our technical workforce who will be focused on executing our FTTH deployment plan we announced a few weeks ago. The company has communicated to employees and has discussed with the PSC that both Altice USA and Altice Technical Services USA will honor all the regulatory commitments agreed to with the states, and we believe this model will provide employees with career growth and advancement opportunities as we build our fiber network."
Meanwhile, there are questions about how Altice plans to fund the FTTH deployment without significantly increasing its capex budget. Light Reading reported earlier this month that the effort could end up costing nearly $9.6 billion according to calculations based on data from equipment vendor Adtran Inc. (Nasdaq: ADTN). (See Altice FTTH Bill Could Hit Almost $9.6B in US.)
Altice says it has developed proprietary technology that should aid in making the rollout more cost effective. The company also has an advantage in that much of its footprint is already fiber-rich, and much of its existing infrastructure is aerial, which is less expensive to upgrade than fiber deployments requiring in-ground trenches.
The Altice service area in the US currently reaches nearly 8 million homes.
— Mari Silbey, Senior Editor, Cable/Video, Light Reading