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Even Frontier Hints Without Major Broadband Upgrades, It’s Dead

Phillip Dampier September 18, 2017 Consumer News, Frontier 5 Comments

Frontier Communications spent $2 billion in 2014 to purchase AT&T’s Connecticut wireline business, believing it could make a fortune selling internet and cable television service to wealthy Nutmeg State residents over a network AT&T upgraded to fiber-to-the-neighborhood service several years earlier.

But thanks to a combination of management incompetence, cord-cutting, and Frontier’s competitors, the phone company’s dreams have turned bad in Connecticut, where the company lost hundreds of millions in the last three years along with at least 22% of its customers in the state. As a result, Frontier has turned a business that made AT&T $1.3 billion four years ago into one that earned Frontier $901.9 million last year.

Hartford Business notes Frontier’s biggest challenge is holding on to customers once they disconnect their landline service. In Connecticut between 2014 and 2016, Frontier lost 154,000 landline customers in the state, leaving just under 522,000 remaining landline customers. That is way down from the 675,000 customers AT&T had just before it sold the service area to Frontier. AT&T struggled with a similar problem, having more than one million landline customers in 2011, according to numbers from Connecticut’s Public Utilities Regulatory Commission (PURA). What made AT&T different is its investment in U-verse — AT&T’s answer to the challenge of lost landline customers. AT&T invested in a new fiber to the neighborhood network to boost broadband speeds and sell television service, giving departing landline customers a reason to continue doing business with AT&T.

For millions of Frontier Communications customers in its “legacy service areas” — owned and operated by Frontier for years, if not decades, those upgrades have been slow to come, if they have come at all. As a result, dropping Frontier service in favor of a wireless or cable company is not a difficult decision for many customers, and cable operators report significant growth where their only competition is DSL service from Verizon or Frontier.

Frontier’s own executives admit broadband upgrades are essential if Frontier is to survive the challenges of landline disconnects.

Customers are increasingly taking a pass on landline service.

“It’s a surprise to no one that we have voiceline declines in Connecticut,” Mark Nielsen, Frontier’s general counsel and executive vice president told the business newspaper. “The challenge is to build our internet and video business so as to offset the declines in voice. We are very committed to the Connecticut operation, we see great potential in it.”

That commitment is coming in the form of internet speed upgrades. Frontier’s primary competitors in the state are cable operators Comcast, Charter, and Cox, some offering speeds as high as a gigabit. Frontier is trying to compete by introducing speeds at or greater than 100Mbps, but so far only in a few parts of the state.

According to Nielsen, Frontier’s profitability is less important to investors than maintaining positive cash flow, which means assuring more money is coming into the operation than going out.

“Cash is what’s available to make investments to return capital to shareholders,” Nielsen said.

But that represents a conflict for Frontier, because many shareholders are attracted to the stock’s long history of returning money to shareholders in the form of dividend payouts. If Frontier has to invest more of its capital on upgrades and network upkeep, that can result in a dividend cut, which usually causes the share price to decline, sometimes dramatically. If Frontier can manage to invest less and cut costs, that frees up more money that can be paid to investors.

For the past several years, Frontier’s business plan has been to avoid spending large sums on network upgrades. But the company was willing to spend handsomely to acquire more customers from a three-state deal with Verizon that cost $10.5 billion. Frontier’s acquisition of Verizon landline customers in Florida, California, and Texas made sense for many shareholders because it would dramatically increase the number of customers served by Frontier, and that in turn would boost revenue and cash flow, from which Frontier’s dividend to shareholders would be paid. Frontier acquired a fiber rich, FiOS service area in all three states, which automatically meant the company would not need to undertake its own significant and costly upgrades.

But Frontier did have to transfer its newest customers from Verizon’s systems to those operated by Frontier. If a company spends enough time and money to protect customer data during such “flash cutovers,” they are usually successful. A company that attempts it without careful planning causes service to be disrupted, sometimes for weeks, which is exactly what happened after Frontier switched customers in the three states to its systems. Customers have never forgotten, and have left every quarter since the deal was first announced.

Financial analysts see where this is headed.

“Each and every quarter their revenues decline, and each and every quarter their customer totals decline,” David Burks, a financial analyst at Hilliard Lyons, told the newspaper. He called Frontier a company that is struggling. He added Frontier needs to stem revenue erosion. He downgraded Frontier’s stock last month after the company reported a second-quarter net loss of $662 million. He could not ignore what he called “disturbing trends,” such as an 11.5 percent year-over-year decline in total customers across Frontier’s entire operation.

 

To win new customers Frontier must improve its network with upgrades that will cost the company billions — spending that is certain to affect Frontier’s shareholder dividend. Even if it does spend money to upgrade, some analysts are wondering whether it is too late.

“The time to play catch up has passed, given the time to market advantage that cable has, and we expect continued pressures from cable as DOCSIS 3.1 steps up the speed advantage that cable already enjoys,” wrote Jeffries in a a report written about by FierceTelecom. “In our view, it is far too late for the ILECs to ramp spend to compete, particularly given high leverage and the significant cost required to expeditiously play catch up.”

7.6 Million Floridians Without Internet/Phone Service After Hurricane Irma

Phillip Dampier September 12, 2017 Consumer News, Public Policy & Gov't No Comments

At least 7,597,945 Floridians are without cable, broadband and phone service after Hurricane Irma left large sections of Florida without power or wired telecommunications service.

According to the Federal Communications Commission, service providers have self-reported multiple large outages including 911 service, cell towers, cable service, and radio and television services. In many cases, the outages are directly tied to power interruptions, and many expect service will resume soon after Florida utilities get electricity service back up and running.

Telephone

Providers report 390 central switching offices are non functioning across Florida at this time. These offices handle landline calls and wired broadband from AT&T and Frontier Communications, among other telephone companies. Where physical damage from wind or water has occurred, it could take weeks or months before those offices are fully restored, but temporary provisions for restoring basic phone service are likely to be in place within days.

There are also significant 911 outages across Florida:

No 911 Service, Calls Going Unanswered: Big Cypress Indian Reservation, Collier County EOC, Ft. Myers Police Department, Glades County Sheriff, Glades County Sheriff Back Up, Hardee County Back Up, Hendry County Sheriff, Highlands County Sheriff, Lee County Emergency Dispatch Center EOC, Naples PD, Okeechobee County Sheriff’s Department, Homestead Air Force, Marathon SO, and Ocean Reef.

911 Service With No Automatic Caller Location Information (ALI): Hardee County Sheriff and Lee County Sheriff

Re-routed with ALI: Atlantic Beach PD, Belle Glade PD, Indian River SO, Manalapan PD, Miami Beach PD, Neptune Beach PD, and St. Augustine PD

Re-routed without ALI: 4 Clewiston Police Department, Desoto County Sheriff, Lee County Backup, and Sanibel Police Department

Potential Outage: The Broward County South Region 911 Center lost power as of 9/10/17 at 2:28PM EDT. We do not know if 911 calls are being rerouted.

Wireless Service

Overall, 27.4% of cell sites in the disaster area of Florida are out of service. The worst outages are in:

  • Collier County: 160 of 212 cell sites are down. (75.5%)
  • Hendry County: 31 out of 46 cell sites are down. (67.4%)
  • Highlands County: 42 out of 80 cell sites are down. (52.5%)
  • Lee County: 186 out of 343 cell sites are down. (54.2%)
  • Miami-Dade County: 739 out of 1,435 cell sites down. (51.5%)
  • Monroe County: 87 out of 108 cell sites down. (80.6%)

Broadcasting

There are two television stations out of service in Florida: WVFW and WZVN. There are 26 radio stations off the air: W227CP, W300CL, W222AW, WROK, WAOA-FM, WHKR, WLZR, WIOD, WOLZ, WINZ, WBTT, WCKT, WRUM, WQOL, WZZR, WSWN, WOTW, WMFQ, WXUS, WYCG, WEAT, WTIR, WMYR, WCNZ, and W294AN.

Telecom Companies Prepare for Hurricane Irma

AT&T, Verizon Wireless, Sprint, and T-Mobile are sending technicians to hundreds of cell sites across Florida to top off fuel generators, test back up batteries, and protect facilities from Hurricane Irma’s anticipated storm surge and associated flooding.

“Customers rely on us, especially during major storms,” said Joe York, AT&T Florida president. “That’s why we practice readiness drills and simulations throughout the year. We do all we can to have our networks prepared when severe weather strikes. We’ve worked for the past few days to position equipment and crews to respond to the storm. We’re closely linked with Florida public officials in their storm response efforts. With a storm of this size, we may have some outages. But if service goes down, we’ll do all we can to get it back up as fast as possible.”

With landfall possible along the Florida coast or inland, Verizon pointed out that in Florida, since last hurricane season, it has densified its network with 4G, fortified coverage along evacuation routes, put cell sites equipment on stilts and installed new systems in hospitals, government and emergency facilities, and high-traffic public areas.

“The country is only beginning to wrestle with recovery efforts from Harvey, and already, residents of Florida and the Caribbean are bracing for another potentially devastating storm in Hurricane Irma,” said Sprint CEO Marcelo Claure. “During times like these, the cost of staying connected to friends and loved ones should be the last thing on anyone’s mind, and we want to do what we can to support our customers across impacted areas.”

Hurricane Irma’s impact on Puerto Rico.

AT&T and Verizon Wireless are positioning portable cell tower trailers just outside of areas anticipated to take the brunt of the hurricane. AT&T in particular has a lot to prove as its network now includes FirstNet — a public private wireless broadband network for emergency responders that also depends on AT&T’s wireless networks. States are still in the process of opting in to AT&T’s FirstNet. The company has more than 700 pieces of emergency cellular equipment, including Cell on Wheels, Cell on Light Trucks, portable trailers and generators, and even the possibility of deploying Cells on Wings — airborne cell towers that can restore cell service in areas where roads are inaccessible because of floods.

Wireline companies are also positioning repair crews in the region to bring service back online. Other technicians are checking on emergency generator and battery backup power, particularly for maintaining landline service.

“Our team is working to prepare for extreme weather and will be there for our business and residential customers to quickly and safely restore any affected network services,” reports Frontier Communications, which provides service in former Verizon landline service areas.

The phone company is reminding landline customers that not all phones will operate during a power outage, but that does not mean Frontier’s landline network is down.

“Customers who rely on cordless phones should consider plugging a traditional corded phone directly into the wall. In the event of a commercial power outage, corded phones on the copper network will still operate; cordless ones will not,” the company says. “If commercial power is unavailable, generators and batteries in Frontier’s central offices serve as a backup. Phone lines generally will have enough power in them to use a corded phone. For customers using FiOS phone services, the battery backup will supply voice service for up to eight hours.”

The company also warns customers to watch out for damaged utility lines after the storm is over.

“Stay far away from any downed cables or power lines. Contact Frontier at 800-921-8102 (business) or 800-921-8101 (residential) to report any fallen telephone poles or cables.”

Some companies are offering customers a break on their bills:

  • Verizon: Landline customers will not pay any long distance charges for calls to Anguilla, the British Virgin Islands, Puerto Rico, Dominican Republic, Haiti, and the Turks and Caicos Islands from Sept. 6-9. Taxes and any government surcharges applicable will still apply. Verizon Wireless customers inside the U.S. will not be charged for texts or calls originating in the U.S. to those same countries and territories for the same period.
  • T-Mobile and MetroPCS customers in affected areas of Puerto Rico:  Will get calls, texts, and unlimited data free from Sept. 6th through Sept. 8th. This free service will be available to customers in the 787 and 939 area codes.
  • Sprint: Effective today through Sept. 9, 2017, Sprint will waive call, text and data overage fees for its Sprint, Boost Mobile and Virgin Mobile customers in Puerto Rico and the U.S. Virgin Islands. For Sprint, Boost Mobile and Virgin Mobile customers in the U.S., the company will also waive all international call and text overage fees to the following: Anguilla, Dominican Republic, Haiti, Turks and Caicos, and British Virgin Islands. For the same period, Sprint will also waive roaming voice and text overage fees for its customers in those locations. Fees will be waived during the time specified.
  • Comcast: Opening more than 137,000 XFINITY Wi-Fi hotspots throughout Florida to anyone who needs them, including non-XFINITY customers, for free. For a map of XFINITY Wi-Fi hotspots, which are located both indoors and outdoors in places such as shopping districts, parks and businesses, visit Xfinity.com/wifi. Once in range of a hotspot, select the “xfinitywifi” network name in the list of available hotspots and then launch a browser. Comcast internet customers can sign in with their usernames and passwords and they will be automatically connected to XFINITY Wi-Fi hotspots in the future. Non-Comcast internet subscribers should visit the “Not an Xfinity Internet Customer” section on the sign-in page to get started. Non-customers will be able to renew their complimentary sessions every 2 hours through Sept. 15, 2017.

AT&T Offers These Customer Tips:

  • Keep your mobile phone battery charged. In case of a power outage, have another way to charge your phone like an extra battery, car charger or device-charging accessory. Applicable sales tax holidays are a great time to stock up on cell phone accessories.
  • Keep your mobile devices dry. The biggest threat to your device during a hurricane is water.  Keep it safe from the elements by storing it in a baggie or some other type of protective covering, like an Otterbox phone cover.
  • Have a family communications plan. Choose someone out of the area as a central contact.   Make sure all family members know who to contact if they get separated. Most importantly, practice your emergency plan in advance.
  • Program all of your emergency contact numbers and e-mail addresses into your mobile phone. Numbers should include the police department, fire station and hospital, as well as your family members.
  • Forward your home number to your mobile number in the event of an evacuation. Call forwarding is based out of the telephone central office. This means you will get calls from your landline phone even if your local telephone service is disrupted. If the central office is not operational, services such as voicemail and call forwarding may be useful.
  • Track the storm and access weather information on your mobile device. Many homes lose power during severe weather. You can stay up to speed as a DIRECTV customer, by streaming local weather channels using the DIRECTV application on your smartphone. If you subscribe to mobile DVR, you can also stream every channel directly to your phone.
  • Camera phones provide assistance. If you have a camera phone, take, store and send photos and video clips of damage to your insurance company.
  • Use location-based technology.  Services like AT&T Navigator and AT&T FamilyMap can help you find evacuation routes or avoid traffic from downed trees or power lines. They can also track a family member’s wireless device if you get separated.
  • Limit social media activity. Keep social media activity to a minimum during and after a storm to limit network congestion and allow for emergency communications to go through.

Business Tips:

  • Set up a call-forwarding service to a backup location. Set up a single or multiple hotline number(s) for employees, their families, customers and partners so they all know about the business situation and emergency plan.
  • Back up data to the Cloud. Routinely back up files to an off-site location.
  • Outline detailed plans for evacuation and shelter-in-place. Practice these plans (employee training, etc.). Establish a backup location for your business and meeting place for all employees.
  • Assemble a crisis-management team. Coordinate efforts with neighboring businesses and building management. Disasters that affect your suppliers also affect your business. Outline a plan for supply chain continuity for business needs.

Keeping the lines open for emergencies:

During evacuations, the storm event and its aftermath, network resources will likely be taxed. To help ensure that emergency personnel have open lines, keep these tips in mind:

  • Text messaging. During an emergency situation, text messages may go through more quickly than voice calls because they require fewer network resources. Depending on your text or data plan, additional charges may apply.
  • Be prepared for high call volume. During an emergency, many people are trying to use their phones at the same time. The increased calling volume may create network congestion, leading to “fast busy” signals on your wireless phone or a slow dial tone on your landline phone. If this happens, hang up, wait several seconds and then try the call again. This allows your original call data to clear the network before you try again.
  • Keep non-emergency calls to a minimum, and limit your calls to the most important ones. If there is severe weather, chances are many people will be attempting to place calls to loved ones, friends and business associates.

Additional information and tips for disaster preparedness can be found at www.att.com/vitalconnections.

Frontier Employees: Company is Adrift as Management Obsesses Over Stock Price

Frontier Communications employees continue to send unsolicited news tips and insider gossip about a phone company in decline, not only losing customers but middle management that have either left voluntary or been asked to leave in a frantic effort to cut costs.

Earlier this year, Frontier CEO Dan McCarthy ended a long-term effort heralded by former CEO Maggie Wilderotter that gave significant autonomy to local and regional managers to handle problems in their respective service areas without having to consult a centralized bureaucracy. McCarthy elected instead to adopt more rigid company-wide policies and practices that often require consultation with senior management. For many mid-level managers already frustrated with the company, that change proved a bridge too far that and several are now working for Frontier’s cable competition.

One of the senior managers responsible for Frontier’s web presence became so frustrated with Frontier’s corporate roadblocks, he dropped his Frontier service in favor of the competition because accomplishing almost anything on Frontier’s website proved frustrating and often impossible.

“Instead of focusing their leadership on ways to turn the company around they seem to be doubling down on their efforts to get as many employees to leave the company as possible,” a Frontier insider tells Stop the Cap!

Some of the employees likely to leave are Frontier’s telecommuting workforce. Senior executives now want many of those workers back in the office.

“[The new policy says] if we live less than 50 miles from a Frontier Office, we have to be in the office every day and could no longer work at home,” our source tells us. “There are employees who had Permanent Work At Home status by HR who are [now] being told they have to relocate to another city [or] come into an office or they will be let go.”

Frontier’s network continues to be criticized as great for some, lousy for everyone else. Our source notes a few years ago Frontier was speed-limiting some of its DSL customers in congested areas because they were using too much broadband and slowing down the network for others. While Frontier’s legacy copper areas continue to endure copper-based DSL with its inherent capacity and speed limitations, Frontier is planning a feast for its acquired FiOS fiber customers, including free automatic speed upgrades.

Less technically conscious customers pay more. In addition to a $4.50 convenience fee that now applies to customers phoning customer care centers to make a payment, our source warns Frontier is about to launch a paper billing fee, reportedly $1 a month, in an attempt to convert customers to electronic paperless billing.

“We are so at a loss as to the direction this company is taking and there is zero vision from senior leadership that is being passed down,” our source said, noting executives are preoccupied with their compensation plans and bonuses. “The directions we’re given change daily, projects and promotions only seem to be reactionary to try to stop the bleeding, but Frontier is in need of major surgery starting with the CEO and every single member of our executive leadership.”

Crown Castle Buys Lightower Fiber for $7.1 Billion; Sets Stage for 5G in Northeast

Phillip Dampier July 20, 2017 Consumer News, Wireless Broadband No Comments

Antenna tower operator Crown Castle International has announced it will buy privately held Lightower Fiber Networks for about $7.1 billion in cash to acquire the company’s extensive fiber assets across the northeastern United States that will be used to connect small cell 5G networks.

The acquisition will allow Crown Castle to market an extensive fiber backhaul network in large cities like New York, Boston, Washington, Chicago, Detroit and Philadelphia, as well as smaller cities particularly in upstate New York, Ohio, Virginia, Pennsylvania, Massachusetts and northern New England. Crown Castle, which already owns many of the cell towers where AT&T and Verizon place their equipment, will now be able to market fiber backhaul connectivity for AT&T and Verizon’s forthcoming 5G networks.

LIghtower’s fiber footprint.

Lightower’s fiber network was originally focused on major markets like Boston, New York City, the District of Columbia, and Chicago. Its partner, Fibertech — acquired by Lightower in 2015, focused on 30 mid-sized cities from Indiana to the west to Maine in the east. The network’s customers are large companies and independent ISPs. In Rochester, where Lightower maintains a Network Operations Center, Greenlight Networks relies on a fiber backhaul network originally built by Fibertech to connect its fiber-to-the-home broadband service. That fiber is likely to soon be shared with AT&T, Verizon, and potentially T-Mobile and Sprint to power any 5G buildouts in the region.

“Lightower’s dense fiber footprint is well-located in top metro markets in the northeast and is well-positioned to facilitate small cell deployments by our customers,” said Crown Castle CEO Jay Brown in a statement. “Following the transaction, we will have approximately 60,000 route miles of fiber with a presence in all of the top 10 and 23 of the top 25 metro markets.”

This acquisition marks Crown Castle’s first major diversion outside of its core market — leasing out the cell towers it owns or acquires.

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  • Geroge: 100mbps is now base speed in many areas that aren't maxx...
  • Ed: I find it amazing that anyone expected Frontier to do anything differently...they have never been an invest and build company...they have always been ...
  • kim collins: i work for Frontier. And i have to say there is alot of people who still need their landlines because cell service is not available to them. Frontie...
  • Lee: Those who own the land leased to cell towers, they should NOT have sold the land, need to get good legal council on the terms of the lease if the comp...
  • Rex: The lights in your home (whether incandescent, CFLs or LEDs) emit far more electro-magnetic radiation (over the course of a day) than you could ever g...
  • Adam: That's pretty unfair to Frontier... Obviously AT&T and Verizon sold off big chunks of their wireline operations because they saw the end of profi...
  • Pat: That's just damn sloppy engineering... There's no excuse for them not having backup generators in junctions that serve large numbers of customers. Th...
  • Chuck: Cellular carriers are having a big come-down now that almost everybody has a cell phone. No more new customers to grab, all you can do is steal from ...
  • Josh: Thanks for the warning :-/...
  • BJ: T-Mobile and Sprint are ALWAYS claiming their coverage is so much better than it used to be, even though they've changed almost nothing. When T-Mobil...
  • EJ: Maybe they have been at the top a little to long and are having trouble figuring out exactly how to respond to a market that is a little more competit...
  • EJ: Cost saving measures in place. Don't want to pay the lease rate on a fiber on a redundant path. Networking 101 redundancy, redundancy, redundancy....

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