Broadband services

Frontier Takes Over FiOS Tomorrow

It's not an April Fools' joke. Tomorrow, on April 1, Frontier is expected to complete its acquisition of Verizon's customer footprint in California, Florida and Texas. While some of the networks in those regions are still copper-based, more than half are FiOS-enabled.

The move, which is costing Frontier Communications Corp. (NYSE: FTR) $10.54 billion, adds more than 1 million residential video customers to the roughly half-million the company has today, and more than 2 million residential Internet subscribers to the 2.5 million data customers Frontier reported in the fourth quarter.

Frontier didn't break out its total number of voice customers last quarter, but when it announced the acquisition more than a year ago, it reported 3.9 million voice customers, with the projection that it would gain 3.7 new voice subscribers from Verizon markets.

In short, when the takeover is complete, Frontier will roughly double in size.

Want to learn more about the changing wireline market? There's still time to register for our Gigabit Cities Live event in Charlotte on April 5.

The shift by Frontier is noteworthy because of the massive consolidation currently underway in the US broadband and pay-TV markets. Frontier is about to become one of the few significantly-sized service providers that isn't a cable company beginning with the letter "C".

The news is also important because of what it means for Verizon Communications Inc. (NYSE: VZ). The grand FiOS experiment that began more than a decade ago has wilted in recent years as Verizon has transferred its focus to wireless projects, and, more critically, wireless profits.

Verizon hasn't given up on wireline altogether. The company did just spend $1.8 billion to acquire XO Communications and further build up its fiber network. Plus, Verizon is reportedly close to wrapping up an RFP process that will decide the vendors for a planned fiber upgrade project using next-generation PON technologies. (See Verizon Bags XO for $1.8B and Verizon Preps Next Major Broadband Upgrade.)

However, Verizon's wireline strategy appears to center more on enterprise services and cellular backhaul than it does on residential services. The telco has said it remains committed to its FiOS footprint on the east coast, but with even the director of FiOS TV promoting Verizon's Go90 OTT mobile video service over her own product, it's hard to know how seriously to take the company's official position. (See FiOS TV Director Cuts the Cord.)

As for Frontier, the upstart video and broadband provider isn't likely to sit on its new assets and let them molder. Arris Group Inc. (Nasdaq: ARRS) CEO Bob Stanzione expressed his opinion last fall that Frontier would invest in expanding the FiOS plant, and Frontier President and CEO Daniel McCarthy has been vocal about his plan to expand TV and broadband service to new customers. (See Video: Frontier's Final Frontier and Frontier Gives Telco TV a Boost .)

Most recently, Frontier Director of Strategic Planning David Curran also talked to Light Reading about Frontier's evaluation of open networking technologies, and the company's particular interest in CORD implementations -- the idea of a Central Office Re-architected as a Data Center. With possible migrations to new open networking technologies, Frontier hopes to be able to better scale to higher broadband speeds and higher numbers of subscribers. (See Frontier Checks Out CORD, SDN.)

— Mari Silbey, Senior Editor, Cable/Video, Light Reading

jayja 4/20/2016 | 10:45:53 AM
Frontier Failure My in-laws in Sarasota remain without internet access since their FiOS service was assumed by Frontier.  Call Center (India?  Phillipines?) was no help.  Help promised in a week ("The check's in the mail"....).  Clearly Frontier was not ready to play with the big boys. 
kq4ym 4/11/2016 | 12:50:47 PM
Re: And even worse Although I'm not a customer, I've read reports that there's lots of customer dissatisfaction soon after the switch to Frontier in Florida. If the glitches can be solved, it would seem there may something interesting to watch in this switcheroo.
bosco_pcs 4/3/2016 | 5:29:50 PM
Re: Confusing @Dan - maybe you are onto something; but on second thought, why then it bought AOL. And its CEO seems to be interested in a piece of Yahoo ($YHOO). So Verizon ($VZ) may not be cut and dry.

It is interesting to juxapose its strategy with ATT's ($T). The latter just purchased DirectTV, granted that DTV also has spectrum asset (I think).

danielcawrey 4/3/2016 | 4:09:51 PM
Re: Confusing Interesting article. I had long thought that Verizon was stretching itself too thin with both wireless and broadband, and this is proof of that. 

Verizon's core business is providing wireless at an enterprise-grade level. Selling some of the broadband business to Frontier is a testament to this. Companies as large as Verizon should focus on being the best at one thing: Wireless. 
VPofMark96277 4/1/2016 | 10:21:19 PM
And even worse My neighbor's on demand doesn't work and there is literally no one to call.  Except an Indian call center to tell you they can't access your account.
VPofMark96277 4/1/2016 | 10:12:09 PM
Already a BAD Well day 1.  And I can't get into my account.  The Frontier India call center picked up and they said they can't log into my account for 7 days, or get our information, or help me in any way.  NICE.  Now, I had herd how totally disorganzed Frontier was but this is stupid.  Help, Lightreading.  Can you please call them and confirm they are this stupid.  Charter - if your out there, I hope you are ready for a ton of us to come back.  I will personally pay $100s of to bail on this cluster!
Duh! 4/1/2016 | 1:10:37 PM
Re: Confusing They're rebranding as "Vantage".  I understand that "FiberHouse" will be a sub-brand.
steve q 3/31/2016 | 11:48:54 PM
Re: Confusing I see Frontier looking at all ways to push out the fiber optic data service to anyone that is looking to pay for it. And then move onto finding a move into the other area of Verizon to push the chance of any idea of Verizon wireless 5g plan.
brooks7 3/31/2016 | 3:25:04 PM
Re: Confusing I would expect that Frontier will have a different name for the service.

Frontier could have already done it on the rest of their lines anytime that they want.


bosco_pcs 3/31/2016 | 2:58:31 PM
Confusing So now FiOS is not necessarily Verizon but it depends on the region? And Frontier could expand FiOS services in its jurisdiction. Wonder how support works...
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