Frontier Communications (NASDAQ: FYBR), the communications service provider headquartered in Norwalk, CT, had 15.4 million broadband-enabled locations in 25 states. Of that total, 5.8 million are fiber passings. The company’s Build Gigabit America fiber-to-the-home plan is on track to achieve 10 million fiber passings. For 2Q23, total revenues were $1.4 billion, down one percent year-over-year. Gains in data and internet services were offset by declines in voice, video, and other services.
Fiber is a growth area. Consumer fiber revenue was $462 million, up 10 percent YoY and Business and Wholesale fiber sales were $284 million, up eight percent YoY. Vishal Dixit, Frontier’s Chief Strategy Officer & EVP-Wholesale, tells Inside Towers that Frontier is working with AT&T to upgrade its tower locations to be 5G-capable. In February, Frontier and AT&T signed an agreement allowing AT&T to deploy 5G and other wireless infrastructure in Frontier facilities. AT&T will tap into Frontier’s fiber-to-the-tower infrastructure for backhaul at AT&T’s cell sites within Frontier’s network footprint.
This agreement is an extension of the deal signed in October 2021 to bring fiber connectivity to large enterprise customers outside AT&T’s current footprint. The Business and Wholesale segment has shown improvement since 4Q22 driven in large part by the AT&T contract. Frontier’s fiber footprint is complementary to AT&T’s existing network and will help accelerate AT&T’s 5G deployment. With a nationwide high-capacity fiber network of 180,000 route-miles, Frontier claims to have 400,000 businesses within 250 feet and 23,000 towers within one mile of that network.
The company maintained its FY2023 capex guidance of $3.0-3.2 billion while cautioning that spending levels will decline in 2H23 and in 2024, taking advantage of capital already spent for site preparation and existing inventory, along with lower home-passed construction costs. To fund that build, Frontier recently obtained a $2.1 billion securitization against existing fiber assets, Inside Towers reported.
Frontier is working with all the MNOs and some tower companies operating in its territory and is increasing the number of FTTT connections. “We’re trying to get away from one tower at a time, particularly in our dense fiber markets like Texas and Florida,” Dixit points out.
The company is focusing on end user requirements for high availability of service, network resiliency and symmetrical speed advantages. “This allows us to create a larger, long-term wholesale business. As a result, revenues are growing year-to-year and quarter-to-quarter,” Dixit says. “It’s a matter of aggregating more towers with multiple carriers and each MNO has a different network architecture.”
Dixit believes that Frontier is well-positioned as an ILEC and an end-to-end fiber service provider. The company makes available its central offices as edge compute hubs for high data, low latency applications including AI using a combination of assets and services. For instance, Frontier achieves network resiliency through a mix of aerial and buried fiber, with more buried in storm prone areas. Redundancy is achieved with multiple fiber routes, or in some cases, microwave, to a site, and backup power generators. Backup options are determined by each MNO’s data throughput, route diversity, and reserve power requirements.
Dixit points out that Frontier can offer fiber access in many rural areas allowing the MNOs to expand 5G into Tier 2/3 markets and build out their “rural edge.” The company helps MNOs increase 5G connectivity as they upgrade tower sites and expand coverage. Ultimately, new use cases will drive the fiber applications. Dixit expects to see more FTTT, not less.
Small cells are another area that the company sees leveraging its dense fiber in residential areas. Dixit believes Frontier is well positioned to support large scale small cell deployments with the ability to upgrade connection speeds from less than 1 Gbps to 10 Gbps. Frontier can scale to 10 Gbps for 5G cell sites, not today, but Dixit says they have line of sight to it.
By John Celentano, Inside Towers Business Editor
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