Frontier's Fiber Fantasies

Frontier FiOS is the fiber-to-home network that gets no respect, at least from the company that now runs it.

What Verizon considers its crown jewel, Frontier Communications considers an afterthought. Since buying up several million landlines from Verizon, Frontier has reluctantly adopted the fiber-to-the-home service already up and running in a handful of areas Verizon sold off.

Frontier CEO Maggie Wilderotter said Frontier would not increase pricing on its services, in fact stating they had not had a price increase in several years.  But just months after winning approval of the deal with Verizon, Frontier stunned customers and regulators with one of the largest rate increases ever seen in the cable television industry: a $30 monthly increase for basic cable.

Understandably, angry customers have been calling Frontier in droves demanding an explanation.

Stop the Cap! reader Betsy was floored when a Frontier representative actually suggested to her its FiOS network wasn’t worth the trouble, and the representative was telling all of the customers calling they should “upgrade” to satellite TV instead.

“How do you even respond to that?  I thought I heard her wrong — I had the speakerphone on, but after the Frontier rep said it, my 87 year old mother who was listening hollered ‘that’s a bunch of bull****’ from the other room,'” Betsy shares.

“My mother almost never swears,” Betsy tells Stop the Cap! “But she was living with us when our family endured satellite’s rain fade, the neighbor’s trees, the picture freezes, and the equipment issues for almost ten years — why would we go back to that?”

In fact, it was Verizon’s FiOS network which attracted the Washington State family to take the satellite dish off the roof and toss it.  So it came as quite a shock to have a Frontier representative try and get her to rip a state of the art fiber network out to go back to DirecTV.

Frontier wants their customers to give up on this...

“Does anyone at this company have a clue what they are doing?  Using their logic, we should go back to dial or hand crank telephones,” Betsy concludes.

We wondered if this was a fluke, but then we found Frontier telling customers nearly the same thing in Ft. Wayne, Ind.

The Journal-Gazette reports Frontier’s rate hike in the Pacific Northwest foreshadowed similar rate hikes likely in the midwestern city that is Frontier’s second largest market, behind Rochester, N.Y.

Frontier Communications FiOS cable customers could be facing a monthly increase of $12 to $30 in coming weeks.

Many of the affected subscribers have a $99 bundle for monthly TV, telephone and Internet services. As an alternative, Frontier will offer DirecTV satellite service free for the rest of the year for customers paying for telephone and Internet, a spokesman said Wednesday.

“We will be making more information available by Tuesday of next week,” said Matthew Kelley, adding that existing customer contracts will be honored.

“With DirecTV, it really is a chance to get three services for the price of two. The channel lineups are pretty comparable.”

DirecTV offers more than 200 channels, Kelley said.

...and "upgrade" to this instead.

“Don’t sign me up,” Betsy writes when we showed her the Journal article.  “Channel lineups don’t mean much when you can’t watch them.”

Betsy’s satellite dish took a beating not only from the weather and efforts to find a clear view to the sky, but also from some birds advertising for a mate.

“The woodpeckers just loved to attack the dish — the jack-hammering sound could be heard all over the neighborhood when they got going,” she said.

Frontier’s Kelley admitted the company is small potatoes in the cable world, and simply can’t compete for good programming prices.

But even those of us at Stop the Cap! know that smaller players need not negotiate programming contracts themselves — they can join one of several groups that pool smaller providers together to grab substantial volume discounts.  Municipal players manage to find reasonable cable programming prices, but a multi-state corporate player like Frontier apparently cannot.

Bruce Getts, business manager for the International Brotherhood of Electrical Workers Local 723, shrugged off Frontier’s FiOS failures.

Getts, whose union represents 700 installers, repair technicians, customer service representatives and dispatchers at Frontier told the newspaper more people are going online to watch TV anyway, so the impact of the price hike might well become moot.

Unfortunately, Frontier is the same company testing an Internet Overcharging scheme in the Sacramento area that makes online viewing an expensive proposition, even more expensive than Frontier’s FiOS rate hikes.

“I think people will rue the day they let these bozos take over our phone service,” Betsy says.  “It looks like our family has a reason to cancel service with Frontier and head to cable.”

Ontario County, N.Y. has completed its 200-plus mile fiber ring and is now open for business… at least for area businesses that want commercial accounts.

But the county’s Office of Economic Development has no intention of building a 21st century fiber network that consumers can’t use — it wants fiber-to-the-home service for every resident.

The formerly rural Finger Lakes county has become an economic growth spot in western New York, with urban sprawl from nearby Rochester and new high-technology businesses attracted by the area’s relatively low taxes and pro-technology attitude.

The high tech fiber ring is the most recent example of the county’s growth-oriented philosophy.

Axcess Ontario, a public-benefit corporation established to oversee the project, built the ring well under its $7.5 million budget.  In the end, the whole project ended up costing just $5.5 million.

The project benefited from faster than expected contracting work and the installation of a natural gas pipeline, through which some of the county’s fiber travels.  Much of the rest is attached to utility poles that stretch across the county’s rural farmlands and small cities, towns and villages.

Now complete, the project is capable of delivering ultra-fast service from cities like Geneva and Canandaigua to the wine-growing region of Naples, to the outer ring towns like West Bloomfield, Victor, Manchester, and Phelps.

Ontario County, N.Y.

“Our mission from the outset was to ensure that every community in Ontario County had access to fiber, no matter how remote that community might be, geographically speaking,” said Geoff Astles, chairman of Axcess Ontario’s board of directors. “We’re proud to say that not only have we accomplished that piece, but we’ve done it under budget.”

The county says the network is open to all-comers, and eight companies are currently using the network themselves or reselling access to commercial businesses that need the capacity fiber brings.  Among them — Verizon Wireless; TW Telecom; Finger Lakes Technologies Group and its sister company, Ontario Telephone Co.; WavHost; Clarity Connect; OneStream Networks; Layer 8; and Integrated Systems.

But nothing prevents a residential service provider from hopping on board, if they’re interested in providing wiring from the fiber ring to individual homes.

“We’re working with several service providers who now have plans to bring fiber to each individual residence,” Michael Manikowski of Ontario County’s Office of Economic Development says. “That’s a little bit down the road. It’s a fairly complicated technical thing that we have to attract other partners to come to the county to help us.”

“The concept of ‘fiber to the home’ is the ultimate game-changer,” said Axcess Ontario CEO Ed Hemminger. “Once residents have fiber to the home, everything changes. Someone who wants to work from home or start a home-based business can do so with ease. Not only will they have instant access to the online global marketplace, but they’ll also have confidence that their home-based Internet connection will be as fast, as reliable and as competitively priced as any office-based system. Imagine conducting videoconferences on your iPad with business partners halfway across the world, all from your living room or your back deck.”

“This project is going to make a difference in the lives of residents and business-owners for the next 25 years,” he said.

Among those reportedly interested: Frontier Communications, which runs limited fiber to some of the county’s new housing developments, but currently does not leverage that technology to deliver broadband faster than traditional DSL accounts the company sells elsewhere in the region.  Time Warner Cable also covers the more populated areas of county through its Rochester/Finger Lakes division.

Individual communities inside the county could also decide to build their own community fiber service for residents, if they are willing to wire individual homes.

Residential fiber service has rarely attracted commercial service providers, convinced the technology is overkill for most consumers.  Some also balk at the capital costs, which are considerably higher than existing copper phone wire or running coaxial cable to homes for traditional cable service.  But many communities suffering from very low speed DSL service and not well served by cable-TV find doing it themselves can deliver service that commercial companies may never provide.  Without the immediate need for quick returns on investment, towns and villages clamoring for faster broadband can finally have it, without the expense of building and running their own fiber ring.

Axcess Ontario threatens to deliver service better and faster than what is on offer further north in much larger Monroe County, which includes Rochester.  That’s because Ontario County’s advanced fiber network could ultimately scrap Frontier’s obsolete copper wire landlines and call out the incremental, slow upgrades from Time Warner Cable.

The Ontario County fiber ring is a nationally recognized broadband model. Harvard University’s Ash Center for Democratic Governance and Innovation at the John F. Kennedy School of Government this fall recognized the fiber ring as a “Bright Idea” — a promising, innovative solution that can assist other communities as they face their own challenges. And earlier this year, county officials met with the Federal Communications Commission in Washington, D.C., to educate FCC officials about the fiber ring and how it can be implemented elsewhere in the country.

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WHAM-TV in Rochester reports Ontario County’s new community-owned fiber ring could eventually deliver fiber to the home service to every resident in the county.  (2 minutes)

Crowell

Fibrant, Salisbury, N.C., community-owned fiber to the home network, shares advice to other communities considering building their own self-reliant, locally-owned broadband networks: work together and outsource the headend.

Christopher Mitchell from Community Broadband Networks alerted us to a video from TelecomTV interviewing Michael Crowell, Fibrant’s Director of Broadband Services.  In it, Crowell shows off Fibrant’s GPON fiber network and explains what the city has learned from the experience of building its own network.

Ironically, a significant part of Fibrant’s network came cheap thanks to Windstream.  It seems what the residents of Salisbury won was also a loss for those living in Concord, N.C.

Crowell explains Concord was served by a small independent phone company — Concord Telephone.  They had decided to build their customers an advanced fiber to the home network similar to Fibrant, until the company was sold to Windstream.  Windstream has no interest in delivering world-class fiber broadband to Concord (or anywhere else), and left Concord with dismal DSL, selling the fiber network equipment to Salisbury dirt cheap — for around 10 cents on the dollar.

But not everything has come so easy to Fibrant, says Crowell.  One of the company’s largest expenses is its headend, which receives, monitors, and distributes the hundreds of video channels Fibrant customers receive.

“What we think would be a better model going forward is for the other cities and counties to do what is called an open access network.  They build and maintain the fiber but get other providers to provide the service,” Crowell said.

Crowell proposes allowing the state’s two largest municipal broadband projects — Wilson in the east and Salisbury in the central-west part of the state, handle the headend, as well as customer service calls and billing on behalf of other communities interested in building their own municipal fiber networks.  Both cities can deliver bulk feeds of video channels to different parts of the state and that saves other communities from spending money to hire employees to monitor redundant, expensive equipment.

That is more or less what is happening further south in Opelika, Ala., where work is underway constructing a fiber to the home network.  But in Opelika, city officials have decided to let cable overbuilder Knology run the network.

Knology’s network is already up and running in nearby Auburn, according to Royce Ard, general manager for Knology.  Ard told WRBL TV:

“We met our scheduled date for installing our first Auburn test customers and the test is progressing nicely. We will begin adding our first paying customers by the end of October,” Ard said. “Initially, our services will be available in a limited number of neighborhoods, but as we build out our network we will contact homeowners and let them know when services are available in their area.”

Knology projects being able to offer service to its first Opelika customers by the second quarter of 2011.

“Knology is very excited about entering the Opelika market,” Ard said. “The technology that we are deploying in the Auburn/Opelika markets will allow us to offer consumers a much better product than they have today. This, along with Knology’s commitment to customer service, will greatly improve the overall experience for consumers in Auburn and Opelika.”

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Fibrant’s Michael Crowell, interviewed by TelecomTV, walks viewers through Fibrant’s fiber network and discusses community-owned fiber networks.  (7 minutes)

Some 1100 communities will have to wait until next year to learn if they are among the one(s) chosen for Google’s new 1 gigabit fiber to the home network.

An announcement on Google’s official blog broke the news to anxious readers this morning:

We had planned to announce our selected community or communities by the end of this year, but the level of interest was incredible—nearly 1,100 communities across the country responded to our announcement—and exceeded our expectations. While we’re moving ahead full steam on this project, we’re not quite ready to make that announcement.

We’re sorry for this delay, but we want to make sure we get this right. To be clear, we’re not re-opening our selection process—we simply need more time to decide than we’d anticipated. Stay tuned for an announcement in early 2011.

Google has also been working on a “beta” network, serving 850 private homes and condominiums on the main campus of Stanford University, owned primarily by the faculty.

That a company the size of Google faces delays from the challenges involved in building a fiber-to-the-home network speaks to similar delays that often slow down municipal broadband deployments.  Community broadband critics often seize on such delays as evidence the networks are not viable and run by unqualified personnel.  But as Google illustrates, such delays are common whether they are run by private or public entities.

Qwest’s head of financial matters told Bloomberg News the company’s decision to sell out to CenturyLink made good financial sense because the telecommunications industry needs more industry consolidation.

Chief Financial Officer Joe Euteneuer said the time was right for Qwest to sell operations in the north-central and mountain west region because there were too many competitors in the marketplace.  Euteneuer said the telecommunications market needs to resemble the cable-TV business, which has been heavily concentrated into two huge powerhouses — Comcast and Time Warner Cable.

Qwest’s merger with independent telephone company CenturyLink continues the consolidation underway among independent phone companies not affiliated with AT&T or Verizon Communications.  The merged entity will challenge Frontier Communications’ position in the landline marketplace.  Regulators in Qwest’s service area have been giving cursory review of the proposed merger and the company expects few problems in getting the merger deal approved in every state affected.

Euteneuer

The merged entity, tentatively to be called CenturyLink, has been spending most of its public relations efforts talking up the reshuffling of its management and executive office operations.

CenturyLink is promoting executives to new regional management positions the company unveiled Friday.  CenturyLink’s new regional structure:

• Eastern, headquarters in Wake Forest: President Todd Schafer, current president of Century Link’s Mid-Atlantic region. Member states are Georgia, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee and Virginia.
• Midwest, headquarters in Minneapolis: President Duane Ring, current president of CenturyLink’s Northeast region; Illinois, Indiana, Iowa, Michigan, Minnesota, Nebraska, North Dakota, South Dakota, Wisconsin.
• Mountain, headquarters in Denver: President Kenny Wyatt, current president of CenturyLink’s South Central region; Colorado, Montana, Utah, Wyoming.
• Southern, headquarters in Orlando: President Dana Chase, current president of CenturyLink’s Southern region; Alabama, Arkansas, Florida, Kansas, Louisiana; Mississippi, Missouri, Oklahoma, Texas.
• Northwest, headquarters in Seattle: President Brian Stading, current vice president of network operations and engineering for Qwest; California, Idaho, Oregon, Washington.
• Southwest, headquarters in Phoenix: President Terry Beeler, current president of CenturyLink’s Western region; Arizona, New Mexico, Nevada.

For both companies’ tens of thousands of employees, there is some trepidation about “cost savings” (translation: job losses) that are also expected from this deal.

In Nebraska, more than one thousand employees remain unsure whether they’ll still have jobs after the merger.

Qwest’s president for Nebraska operations, Rex Fisher, is not waiting around to find out.  He’s leaving, saying CenturyLink’s plan to restructure management roles “weren’t opportunities I was interested in,” the 53-year-old executive said.

A Qwest spokeswoman told the Omaha World-Herald the change in itself will have minimal immediate impact on the workforce level in Omaha.

Joanna Hjelmeland told the newspaper specific changes for Omaha’s workforce will “become more clear down the road,” Hjelmeland said.

“We are combining two companies, and in some instances there are going to be redundancies,” she said. “Eventually there are going to be job reductions as a result of the merger.”

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WKBT-TV in La Crosse, Wis., reports the city is going to lose Qwest’s regional headquarters, formerly located in La Crosse, as part of the merger shuffle.  (1 minute)

Brian Stading, current vice president of customer operations for Qwest in Denver, is now preparing to relocate to head the regional office in Seattle.  He outlined some of the changes expected to impact Qwest/CenturyLink customers in the region.

“I think you’ll see the continued focus on providing the highest quality service at the best possible price, both from a local phone service as well as from a high-speed Internet perspective and you’ll see a continued emphasis on expanding our broadband capability both in the city as well as in regional areas,” Stading told the Puget Sound Business Journal.

Stading claims the company will be refocusing efforts to improve the reliability of its core business – landline service, and make incremental upgrades to broadband capability and speed.

“A lot of that does overlap with our high-speed broad deployment because any time we have the opportunity to go put in new fiber lines, it just provides additional quality throughout our backbone networks, so the two really do go hand in hand, both the expansion as well as the continued emphasis on reliability,” Stading said.

But there is every indication Stading is referring to middle-mile fiber infrastructure — cable that runs between telephone company central office facilities, and not to individual customer homes.  CenturyLink, like Qwest, relies almost exclusively on DSL service delivered over standard telephone lines for broadband services.  Qwest has also been deploying ADSL 2+ technology, a more advanced form of traditional DSL, in some areas in the Pacific Northwest and mountain west region.  But many Qwest customers have no access to broadband at all, because of the remote areas the phone company serves in many states.

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Bloomberg News talks to Joe Euteneuer, Qwest’s CFO about why Qwest merged with CenturyLink.  (4 minutes)