Gigabit service could be coming to Fios fiber-to-the-home (FTTH) markets in northern New England when Consolidated Communications acquisition of Fairpoint Communications is completed, said Consolidated CEO Bob Udell yesterday. Although he cited a range of Consolidated Fairpoint opportunities, the possibility of upgrading the Fios markets is “probably where I see the best opportunities for some quick wins,” Udell told attendees at an investor conference.
Udell pointed to “100,000 plus Fios passings that are likely candidate locations for a gigabit offering.” Upgrading the Fios FTTH infrastructure to support gigabit service would not “take a lot of effort,” Udell said. FairPoint gained these Fios properties through their 2008 acquisition of Verizon properties in northern New England.
Consolidated Fairpoint Opportunities
Fairpoint actually had done a considerable amount of work to upgrade network infrastructure in the territory it acquired from Verizon, but had not heavily promoted those upgrades, Udell said.
Udell sees opportunities for grass roots marketing, such as using Vermont’s Front Porch Forum web portal to promote Consolidated offerings.
Unlike some telecom service providers, Consolidated has continued to focus on residential as well as enterprise and wholesale services – a strategy Udell said has helped the company maximize opportunities. He pointed to the self-service portal Consolidated developed that has reduced truck rolls and enhanced customer relations. The company was able to make the investment in developing that portal because it spread the costs across all three lines of business, Udell said, adding that he sees the self-service portal as another important element that Consolidated will be able to use to enhance the Fairpoint business.
If Consolidated can cut the rate of decline in Fairpoint’s consumer business by even a point or two that could “move the needle on cash flow significantly,” Udell said.
On the downside, Udell sees new challenges in Consolidated’s traditionally strong business providing wholesale connectivity to wireless carriers for network backhaul. He noted, for example, that as the business shifts more toward small cells, the company expects to see fewer synergies with its consumer and enterprise business. Consolidated often has been able to leverage investment in fiber to cell towers to upgrade service to homes and businesses in the area. But with small cells, those opportunities are more limited, he said.
Udell also noted that some major wireless companies are looking to renegotiate backhaul deals now that more and more customers are purchasing unlimited plans. In areas where it has few competitors in the wholesale market, Consolidated has been in a stronger negotiating position with the carriers, but in competitive markets the company has had to renegotiate some deals, he said.
Udell made his comments at the Cowen and Company Technology, Media & Telecom Conference, which was also webcast.
