Verizon’s announcement this week about the company’s commercial agreement with Eaton Fiber is the latest example of how important the “killer bundle” of mobile and internet service has become. Or, as Verizon put it in the press release, the goal is to “accelerate Verizon’s broadband and mobility convergence strategy.”
Customers who buy both mobile and internet from the same provider generate higher average revenue and are less likely to churn in comparison with customers who only buy a single service. While mobile service is widely available nationwide from AT&T, T-Mobile and Verizon, no provider has a nationwide broadband footprint. But all three providers are expanding where they offer broadband.
Verizon’s plan to purchase Frontier will expand the company’s reach to 31 states and the District of Columbia. The agreement with Eaton Fiber, an affiliate of Tillman Global Holdings, will target markets outside of Verizon’s and Frontier’s current fiber-to-the-home footprint.
The Verizon/Eaton Fiber Deal
According to the press release, Eaton Fiber will “fund and build the network and be responsible for network maintenance and installation.” Verizon’s responsibilities will include sales, marketing, and end-user customer service.
The wording of the release suggests that other providers also will be able to use the network, but Verizon will have a head start.
“Verizon will be the exclusive retail provider of residential fiber services over the new network through the build phase and for an additional time period, ensuring competitive advantage in subscriber acquisition,” the release states.
What the Others Are Doing
AT&T also has been making fiber deals targeting areas outside its broadband footprint. The company also has a joint venture with BlackRock to expand its fiber reach.
Although T-Mobile has had tremendous success with its fixed wireless offering, the company lacks the expansive fiber footprints that AT&T and Verizon already have. Unsurprisingly, the company’s fiber strategy, in large part, has been to acquire fiber assets that are already in the ground, through joint ventures to acquire Lumos and Metronet.
In addition, T-Mobile has its own deal with Tillman Fiber.
