Frontier is conducting a trial of linear video over copper network infrastructure in Connecticut and may expand the trial to other markets soon, said Frontier Executive Vice President and Chief Financial Officer John Jureller yesterday. Jureller made his comments in a question and answer session at Wells Fargo Securities Technology, Media & Telecom conference, which was also webcast.
“We think there are interesting opportunities as we think about . . . linear video,” commented Jureller, who noted that advances in compression technology and server architecture have brought down the cost of delivering video service.
“Video is a profitable product even in and of itself,” Jureller added. “And in a bundle it’s even better.”
The Improving Telco Video Business Case
Frontier is able to achieve profitability on video offerings despite content costs, Jureller said – and that’s quite a statement, considering that high content costs drove Frontier initially to de-emphasize video when it acquired FiOS properties from Verizon several years ago.
A lot has changed since then. A different Frontier executive said recently that the company doesn’t expect to change much about FiOS services assuming the company’s plan to acquire additional lines from Verizon is approved. The executive also noted that Frontier was planning to bring its existing FiOS offerings in line with what Verizon currently offers.
Frontier is expected to acquire Verizon lines in Texas, Florida and California – and according to Jureller “operationally we will be ready for a hand-over at the end of March.”
Also at yesterday’s conference, Jureller noted that Frontier has achieved net broadband subscriber additions for 11 straight quarters. That’s a substantial accomplishment, considering that the company in many areas delivers service over connections that rely, at least in part, on traditional copper telephone wiring and that it has a cable competitor in 95% of its service territory. Some other service providers in those circumstances have been losing broadband customers as end users desire the faster service speeds that cable can support.
Jureller credited Frontier’s success in this area to offering “customer choice” and having the right product at the right price point. More than 70% of customers take service at 6 Mbps or less – even though 75% of customers can get service at speeds of 12 Mbps or higher, he noted.