Frontier Communications will focus primarily on fiber upgrades in Connecticut and Texas in 2021, bringing fiber to the home service to more than 280,000 customers in Connecticut and at least 24,000 additional customers in the San Angelo area of Texas.

Company officials told shareholders it expected to bring fiber upgrades to 495,000 additional locations this year as part of a multi-year plan to scrap portions of its aging copper wire network and bring fiber to the home service to at least six million homes and businesses in its service area. The company previously announced it would focus its fiber upgrades primarily in its California, Texas, Florida, and Connecticut markets.

Frontier has a long way to go to make a dent in retiring its copper network, which currently still serves 11.8 million homes and businesses. Frontier has only committed to upgrade about half of those homes to fiber, leaving the rest stranded on copper or potentially eventually sold off to another provider.

The most noticeable construction activity this year has been in Connecticut, especially in Fairfield and New Haven counties. Customers in the area report Frontier selling 940/880 Mbps fiber service for $79.99 fixed price for three years. Customers can also choose 50/50 Mbps service for $49.99 or 500/500 Mbps service for $59.99 a month for up to one year. The two faster plans include a Ring video doorbell as a sign-up promotion. There are no data caps.

A Rochester, N.Y.-based broadband company founded by an ex-president of Time Warner Cable and a former top executive at Rochester Telephone is bringing broadband competition to thousands of residents in Connecticut and Pennsylvania through its fiber-to-the-home network.

GoNetspeed has been aggressively expanding its service in Comcast, Verizon, and Frontier Communications service areas in suburban Pittsburgh and several cities in Connecticut. According to chief operating officer Tom Perrone, GoNetspeed has managed to buildout 100 network miles of fiber across 13 towns in two different states in just the first six months of 2018, providing a new choice for broadband service to over 30,000 homes and businesses.

Most recently, the company completed expansion in the New Haven, Conn. neighborhoods of Beaver Hills, Edgewood, and West River, adding an additional 3,000-5,000 homes to its network service area.

GoNetspeed prioritizes expansion in areas where there is little competition and where neighborhood density makes it financially feasible to bring fiber optic cables into an area. The company markets its service with simplified, lifetime pricing:

• $50 for 100/100 Mbps
• $70 for 500/500 Mbps
• $90 for 1,000/1,000 Mbps

In areas when service is first offered, the $100 installation fee is traditionally waived. There are no data caps. Static IPs and inside wiring are available at an additional cost.

GoNetspeed has received positive reviews from customers in parts of Bridgeport and West Hartford, where service is already available in Connecticut. In suburban Pittsburgh, GoNetspeed is available in parts of Ambridge, Beaver Falls, Baden, Conway, Beaver, Monaca, and Rochester. Over the summer, it announced it would soon also service New Brighton and Aliquippa. In general, the company wires neighborhoods where at least 10% of residents are committed to signing up for service. In Pennsylvania, it faces competition primarily from Comcast and Verizon. In Connecticut, competition will come from incumbents Comcast, Altice USA, and Frontier.

GoNetspeed’s headquarters are in suburban Rochester, N.Y. Ironically, it does not offer residential service in New York.

A GoNetspeed truck

The company originally behind GoNetspeed was Fibertech Networks (since sold to Crown Castle, a cell tower owner/operator). The founding partners were John K. Purcell, a former vice president at Rochester Telephone Corporation (now Frontier Communications) and Frank Chiano, the former head of Time Warner Cable in Rochester.

Fibertech was founded in 2000 as a fiber optic network operator. Purcell passed away in 2017, but Fibertech continued, eventually amassing a valuable 14,000 mile metro fiber network serving cities around the northeast. Fibertech served commercial customers like corporations, institutions, and wireless network operators seeking fiber connections to buildings or cell tower sites.

In the last several years, fiber network operators have started to enter the retail broadband marketplace as fiber overbuilders — providing fiber to the home service to areas where demand warrants investment. Most overbuilders target areas where no existing fiber competitor exists, which makes the northeast a viable target.

Verizon dropped its FiOS fiber to the home network expansion project eight years ago and incumbent telephone companies including Verizon, Frontier, Consolidated (formerly FairPoint), Windstream, and CenturyLink have shown little interest in investing in significant fiber upgrades in medium-sized cities in New England, the Northeast, and Mid-Atlantic region. That has given Comcast and Charter Communications — the two largest cable operators, a substantial and growing market share. But customers often loathe both cable operators, and there is built-in demand for new competition.

New Haven. Conn.

Local officials are also happy to see another competitive option. New Haven officials, like many others in Connecticut, have embarked on an effort during the last few years to attract new players to the state, especially after Frontier Communications acquired the assets of AT&T Connecticut. Many communities in Connecticut report a significant digital divide, particularly over the cost of internet access. New Haven, which has a significant low-income population, is happy to see GoNetspeed be part of the solution, but has wondered if GoNetspeed will expand service into lower-income areas of the city.

Connecticut Consumer Counsel Elin Swanson Katz, whose office manages broadband expansion in Connecticut, told the New Haven Register GoNetspeed’s expansion in New Haven “is just another strong indicator that Connecticut consumers are interested in having different options for broadband Internet service.”

“The more competition there is for consumers, for them to have choices, the better off we are,” Katz said. “It’s really important for our state to have ubiquitous access to affordable high-speed broadband that is reliable and that touches every corner of out state.”

“Of course you know this means war.”

Altice USA has found a way to use CBS’ All Access online streaming service against a Connecticut CBS affiliate that blacked out its signal for some Connecticut Cablevision customers.

Meredith-owned CBS affiliate WFSB-TV in Hartford has been off the Optimum television lineup in two dozen Connecticut towns as of 5pm Friday, Jan. 13 after negotiations between Iowa-based Meredith and Altice USA broke down over the price of renewing a retransmission consent contract that Altice claims is 800% more expensive than before.

That means Optimum customers in Litchfield County no longer have access to CBS programming. Or do they? Optimum’s website is redirecting affected customers to WFSB’s network — CBS — and offering a week’s free trial of CBS’ All Access, which allows viewers online access to all CBS programming on demand.

Optimum’s previously negotiated distribution deal with CBS for the All Access platform has been in place since the summer of 2015, which means CBS cannot pull the offer down from Altice’s website. That effectively means CBS is being used to undercut its own affiliate’s most important leverage — taking away popular programming until a provider finally capitulates and signs a renewal contract.

Matt Polka, president of the American Cable Association, which represents small and independent cable companies, loves it.

“Local broadcasters cannibalized by their own network!” Polka tweeted.

Oh…The #Irony — Local #broadcasters cannibalized by their own network! Gotta love the #Internet and the #ISP that provides it! https://t.co/RABX3BHh4R

— Matthew M. Polka (@MATTatACA) January 16, 2017

Altice USA has promised investors it will hold the line on programming costs even if it means finding alternatives for customers. This seems to be an example at work.

Will CBS All Access weaken Meredith’s position on WFSB to force price concessions? The New Haven Register isn’t sure, reporting there are years of “bad blood” between Cablevision and Meredith over carriage contracts:

During the last retransmission agreement negotiations in 2014, Cablevision Systems called on the Federal Communications Commission to investigate whether Meredith Corp. was meeting public interest obligations that are an important component of all television station licenses. Cablevision also sued Meredith in Connecticut’s court system under the Unfair Trade Practices Act.

The latest dispute has attracted the attention of both of Connecticut’s U.S. senators.

“I typically don’t get involved because it’s not for me to dictate the terms of a dispute between a cable company and a network,” Sen. Chris Murphy said in a statement issued Friday night. “But I haven’t been pleased with Altice’s commitment to Connecticut since it bought Cablevision.”

FierceCable reported the area’s congressional delegation isn’t happy with either company:

Connecticut’s two Democratic U.S. Senators, Richard Blumenthal and Christopher Murphy, sent a letter addressed to both Meredith Corp. CEO Stephen Lacy and Altice USA CEO Dexter Goei.

“While we respect the private negotiations being conducted by Optimum and WFSB and make no representations as to the merits of either side’s position, we believe that the current impasse does a disservice to Connecticut families and we urge you to negotiate in good faith to bring an end to this blackout,” the Senators wrote.

Altice, meanwhile, said in its own statement, “We have been negotiating in good faith for weeks and made multiple offers to Meredith even though their initial request was for more than 800% over what we currently pay.”

Look what’s in the box. MergeMaster Patrick Drahi. (Illustration: Michel Kichka)

Cable conglomerate baron Patrick Drahi promised American, French and Portuguese consumers he would bring them value for money by taking control of large established telecom companies in both countries and revamp their products and services to bring improved service. Consumer advocates in all three countries continue to argue customers are still waiting for Drahi’s debt-laden Altice empire to deliver on its promises.

A flurry of mid-summer articles in the French media continue to acknowledge Drahi’s formula has brought results — for him and his top executive minions, but has caused headaches for employees, customers, and even the government.

The biggest firestorm involves Altice-owned SFR’s newly-announced plan to slash at least 5,000 more jobs at France’s fourth-largest mobile operator, which also provides wired cable-TV and broadband services in parts of the country. That represents at least one-third of SFR’s total workforce. The planned cuts run so deep, some in the French press call them “violent.” These new cuts are on top of the 1,200 jobs Drahi cut when he took control of SFR two years ago. An Altice executive warned that if they still perceive to be “fat on the bone,” there will be further cuts after that, presumably starting in 2019.

The job cuts have raised the ire of some in the French press because one of the conditions of Altice’s takeover of SFR was a commitment not to cut jobs. But some reporters may have missed the fine print negotiated with regulators  — the job protection agreement expires in July 2017, after which Drahi can slash at will. And he will.

Investment banks love it. American and European banks have loaned €50 billion ($55 billion) — a record amount — to Drahi to buy up telecom companies on a virtual credit card and deliver short-term results by slashing expenses, which at least temporarily boosts profits. When customers find out the implications of the draconian cuts, they complain and tend to leave. But savvy investors learn how to cash out before that happens, often walking away with huge returns. Such methods have been business-as-usual in the United States for a long time. But Drahi has improved on the old formula of relying on OPM – Other People’s Money – to build his empire.

Some of the money flowing through Altice’s coffers comes from the French taxpayer, currently footing the bill for unpopular French President François Hollande’s key measure to boost the competitiveness of French companies — the Tax Credit for Competitiveness and Employment (CICE), which significantly cuts employer’s labor expenses. Altice has been a grateful recipient of this gift from French taxpayers, who pay for it through new ecological taxes and an increase in Value Added Tax (VAT) rates, which like our sales tax, applies to goods and services one buys. The standard VAT rate in France is now 20%, with 10% charged on restaurant meals, transport, renovation/improvement works and certain medical drugs, and 5.5% on food, water and non alcoholic beverages, books, special equipment for the disabled and school meals. The other half of the money spent implementing the CICE came from decreased public spending on infrastructure and social service programs. Take from the poor and middle class and give to the corporations, Hollande’s critics claim. The program was supposed to protect employment, but critics say it has had little or no effect beyond enriching large corporate conglomerates who hire and fire for their own reasons, and are not particularly concerned about what that could do to future government payouts.

French newspaper l’Humanité is calling on the government and Mr. Drahi to account for his use of taxpayer-funded CICE aid. The paper demands the Hollande government to disclose exactly how much Altice’s SFR has received from the program.

Unemployment office in Connecticut

Altice continues to claim the job cuts will be voluntary — a suggestion scoffed at by employee unions in both France and Portugal, where Altice operates telecommunications companies. In addition to asking Altice-owned Suddenlink and Cablevision employees whether the recent sudden separation from their paychecks was voluntary, unions claim they have the benefit of past experience.

“When they say ‘no job cuts’ and 1,200 have already been cut over the past 18 months, how can we trust them?” asked Frederic Retourney, a spokesman for the CGT-FAPT employee union. “We know that voluntary redundancies are made under duress in most cases. When SFR announces 5,000 job cuts when there are 14,400 employees at the company now, we do not see how one can speak of voluntary departures.”

The job cuts at Altice’s U.S. operations — Suddenlink and Cablevision — have just begun. In a filing with the Connecticut Department of Labor, Altice disclosed it is issuing a total of 587 termination notices in that state — 482 call center workers in Shelton who will lose their jobs Nov. 1 and another 105 in Stratford leaving in two waves Oct. 14 and Dec. 15. Cablevision’s chief Connecticut competitor Frontier Communications is turning Altice’s lemons into Frontier’s lemonade by capitalizing on the job cuts with a quickly organized media push for a job fair on Aug. 31 in New Haven targeting the soon-to-be-former Cablevision workers.

Frontier will hold interviews for the former Altice call-center workers and field technicians. The alternative, if those former Cablevision workers still want to work for Altice, is to move to New York or New Jersey and hope their jobs don’t get cut again. With Frontier, they can stay in Connecticut.

Altice-owned SFR Francophone call center workers face even bigger challenges from relentless demands for cost cuts. In 2015, Altice announced it was open to relocating its Moroccan-based customer care call center to Madagascar, a large and severely economically depressed island nation off the eastern coast of southern Africa. Drahi, who told Wall Street he likes to pay as little as he can in salaries, is evidently upset labor costs in Morocco now force Altice to pay salaries up to €500 a month ($560). The company said it was open to seeking solace hiring French-fluent replacement workers in Antananarivo, Madagascar’s capital city, where the average annual salary is $260. In contrast, Connecticut call center workers make an average of $14.80/hour, according to Indeed.

Connecticut State Rep. Laura Hoydick (R-Stratford) acknowledges employee life with Altice in charge of Cablevision may be a tough ride.

“Having gone through unemployment with family members — and now me — emphasizes how the Cablevision employees are nervous for their livelihood and existence,” Hoydick told The Hour. “I thought it was great that the Frontier folks saw that there was an already-trained workforce here in Connecticut.”

Other state Republicans are attempting to blame Democratic Gov. Dannel P. Malloy for Cablevision’s job cuts, characterizing them as evidence employers are fleeing the high taxes and expenses associated with running a business in Connecticut.

“People are making a choice: ‘Do I stay in Connecticut and weather the storm, or do I move out of the state?’” said state Rep. Jason Perillo (R-Shelton).

For now, those decisions are mostly made by Altice’s cable company call center workers and some members of middle management. But Patrick Drahi’s long-term plan to conquer the media business depends on implementing his “convergence” strategy, which means owning and controlling not only the means of distribution, but also the product being distributed. l’Humanité compared Drahi’s business to a multibillion cephalopod, with octopus-like tentacles extending his control and influence well beyond the cable business.

In France, he is accomplishing his mission by buying up cable networks, newspapers, and other media outlets which he packages together. Now a customer doesn’t just buy cable TV — he buys TV, internet, phone, the daily newspaper, and magazines for one flat price. For about $22 a month, SFR customers get unlimited digital access to 17 newspapers and magazines including Libération, l’Express, and l’Expansion. Then you can watch Drahi’s new sports channels and local news channel — all owned by Altice. Drahi told the French Senate his new bundled media model could “save the press.” But dig a little deeper and you discover Drahi’s altruism is considerably more limited.

By bundling everything together, the Altice-owned businesses each enjoy the enormous benefit of having their products taxed at the special press VAT rate of 2.1%, down from the usual 20% that would be otherwise owed. Altice pockets the savings for itself — a considerable boost in gross revenue.

More conservative investors worry about how Altice is managing to pay for all of its acquisitions and still manage to cover its existing massive debt, especially as Drahi plots to bring his model to the United States. His goal in America: to create the largest or second-largest telecom company in the country. Worried shareholders have been placated by the news massive layoffs are in SFR’s future, with the cost-savings they bring. Those still not satisfied were quieted after Numericable, another Altice concern, borrowed almost two billion dollars and raided Altice’s treasury for another billion to finance a dividend payout to shareholders worth more than $2.5 billion. Of course, Mr. Drahi himself is among the top recipients.

Frontier Communications has topped AT&T’s penchant for grandiose Fiber to the Press Release announcements with a new gigabit fiber to the home service now being promoted in Connecticut, despite being available to only two homes in a single upscale subdivision in North Haven.

Frontier FiberHouse is Frontier’s answer to Verizon FiOS, says Joseph Ferraiolo, Frontier’s regional general manager in New Haven County. Ferraiolo told the New Haven Register Frontier has introduced the service to a pair of homes in Lexington Gardens, a new single-family subdivision.

Frontier’s expansion of the service in 2016 does not appear to be exactly aggressive, with plans to only wire up to 200 newly built homes in the immediate area.

Frontier’s fiber network relies on a Gigabit Passive Optical Network (GPON) and is intended to replace copper telephone wiring.

Ferraiolo admits Frontier is currently favoring new housing developments where fiber can be dropped in a conduit/pre-existing trench during construction without the cost of tearing up yards and streets. But he also claims Frontier will make a commitment to any municipality that gets the fiber service that it will be available to every part of the community, not just those likely to be most profitable. If Frontier keeps its promise, it will be the first time the phone company has provided customers with universal access to uniformly high-speed broadband. Even its acquired FiOS networks in Indiana and the Pacific Northwest are not guaranteed to be available to every resident.

“We think this is a good option for us: new builds, small complexes,” Ferraiolo said. “The developer is very happy with it and we’re very happy with it.”

Customers like William Morico will believe it when they see it.

“We have been trying to get ‘high-speed’ Internet in our neighborhood for years, well before the Frontier disaster,” Morico writes. “All we want is the 12-18Mbps service that is advertised and available elsewhere in New Haven. [We] cannot get any answers from Frontier. Even their customer service and tech staff are frustrated with this company. It’s time for the state gig project.”

The company claims it is “exploring” other rollouts of Frontier FiberHouse in Stamford and New Haven, but there are no specifics.

Some observers question the timing of Frontier’s fiber announcement, noting state and local officials are still considering a private-public partnership that could lead to a public statewide gigabit fiber network in Connecticut. News that a private company is willing to shoulder the entire expense of a fiber project could be used in legislative efforts to derail Connecticut’s CT Gig Project. But Frontier has offered no guarantees whether or if it intends to blanket its service area across the state with fiber or limit FiberHouse to a de-facto demonstration project in a handful of homes in new housing developments.