Tag Archives: frontiercommunications

Penalties, but not prevention, for deceptive ISP billing practices

by Steve Blum • , , , ,

Consumer reports cable billing 3oct2019

It’s common practice for big, monopoly model broadband providers to promise low prices to new subscribers, then tack on arbitrary fees after they’re locked into long term contracts. AT&T was recently slammed for adding a property tax surcharge to some customers’ bills – no one has figured out yet why AT&T thinks it can do that in the first place, let alone why it more than doubled the charge – California property tax rate hikes are tightly restricted. Frontier Communications also adds fees on top of the rates customers have agreed to.

Comcast is a frequent target of consumer billing complaints, and state attorneys general are listening. Just about a year ago, the Minnesota attorney general took Comcast to court over billing practices. The case was settled on Wednesday. According to the Minnesota AG

Part of being able to afford your life means knowing the full cost of what you’re getting, getting what you were promised, not being overcharged for things you didn’t ask for, and not being unfairly charged to get rid of things you didn’t ask for. But when people signed up for Comcast, that’s what happened to them…This settlement will help put money back in Comcast’s customers’ pockets where it should have been in the first place. Just as importantly, it provides millions of dollars’ worth of debt relief. And we’ve made sure that going forward, Comcast customers will know exactly how much they’ll pay for service before they sign up for it. That should put an end to unpleasant surprises.

Another deceptive billing case in Washington state last year resulted in Comcast being hit with a $9 million fine, plus orders to make refunds to customers.

It’s not just broadband service – arbitrary fees are added to the full range of products and services that telephone and cable companies provide. A study by Consumer Reports showed that the typical cable TV customer pays an extra $450 a year, just because. The graphic above breaks that down.

So far, little has been done to stop deceptive billing practices in the first place. That could change. The Federal Communications Commission’s declaration that broadband isn’t a telecommunications service passed the buck to the Federal Trade Commission, which might or might not get around to doing something about it. State governments also have a role to play – a federal appeals court opened the door to broadband consumer protection laws and other state-level regulation last year. So far though, no one in Sacramento has shown much interest in walking through it.

Another $13 million approved by CPUC for California broadband infrastructure subsidies

by Steve Blum • , , ,

Frontier Communications won’t be able to double dip on California and federal broadband subsidies, and Charter Communications won’t have to follow rules that tie price commitments to infrastructure subsidies. Yesterday, the California Public Utilities Commission made those decisions as it approved California Advanced Services Fund (CASF) grants totalling $12.7 million for five projects, two by Frontier and three by Charter.

Add in the six CASF grants approved two weeks ago and one approved in September, and you get a 2019 CASF subsidy total of $25.5 million.

Frontier is getting $11.3 million to upgrade DSL-based service for 381 homes in Lassen, Modoc and Kern counties, and to build a middle mile link from Alturas, in Modoc County, to Standish, in Lassen County. As with its past CASF grants, Frontier is only promising to deliver slow broadband service at 10 Mbps download and 1 Mbps upload speeds.

In May, Frontier applied for $13.5 million for the two projects. The CPUC chopped out $2.2 million because the Federal Communications Commission is already paying Frontier, through the Connect America Fund program (CAF II), to serve some of the homes included in its original CASF proposal. According to the resolution approving the Lassen/Mono project…

Frontier accepted $473,487.74 in CAF II grant funding to provide broadband access to 187 unserved households in the project area. This represents a $2,532.02 per household subsidy provided by the CAF II program and any remaining costs to connect CAF II households should be paid with Frontier’s own private capital, as Frontier has stated in its comments to this resolution. Based on the last-mile funding determination, Frontier is responsible to fund $936,239.91 of the $1,409,727.65 project costs to build to CAF II locations.

A similar calculation was made for the Kern County project.

Charter, on the other hand, got almost everything it wanted. The three projects approved yesterday are in Riverside, San Bernardino and Ventura counties. The $1.4 million award is only $49,000 less than requested and, crucially, the CPUC waived service price guarantees and installation fee waivers that normally come along with CASF subsidies. The dubious rationale was that 1. Charter’s billing system isn’t set up to handle exceptions for such small areas – a total of 279 homes are involved – and 2. it was nice of Charter to even ask for the money. It’s the first time that a major cable company participated in the CASF program, which is reckoned to be a significant milestone.

Both companies have two to three years to finish construction. Charter’s projects are minor extension to existing hybrid fiber-coax systems and can be done quickly. Frontier’s Kern County build isn’t much more complicated, but it’s Modoc/Lassen project is complex. The real question is whether it’ll be able to survive as a company with its current capital and ownership structure intact.

CASF broadband infrastructure grant resolutions approved 19 December 2019:
Charter Communications – Highland Orchid Drive, Country Squire Mobile Estates , Silver Wheel
Frontier Communications – Northeast Project: Phase1
Frontier Communications – Taft Cluster

CPUC approves $12 million subsidy for six broadband infrastructure projects

by Steve Blum • , , , ,

Six of the eleven broadband infrastructure projects on the California Public Utilities Commission’s agenda yesterday were approved for subsidies from the California Advanced Services Fund (CASF). The other five were bumped to the CPUC’s next meeting, on 19 December 2019. Links to the most current resolutions are below.

Cruzio’s Equal Access Santa Cruz project was approved, without changes, for a $2.4 million grant. The commission rejected an attempt by Charter Communications to re-litigate its earlier and unsuccessful attempt to kill it. In doing so, commissioners reiterated that incumbent broadband service providers get one, and only one, opportunity to block proposed projects…

Staff also agrees with [the Central Coast Broadband Consortium] and rejects Charter’s request to remove a census block from the project area because Staff has already made a determination on the challenge. [CPUC Decision 18–12–018] set forth a clear process for challenges and Staff‘s determination of the challenge stands.

All five of the projects proposed by the Plumas Sierra Electric Cooperative (PSEC), totalling $9.7 million in grants, were approved too. The commission accepted PSEC’s field test data that demonstrated the lack of mobile broadband service in its Lake Davis project area.

Two projects proposed by Frontier Communications and three by Charter Communications are on hold. Both companies filed comments asking for more money than recommended by CPUC staff. As with the Cruzio project, Charter attempted to re-litigate its opposition to Frontier’s project plans in the Taft area of Kern County. It also objected to pricing obligations that CASF rules would normally impose on the projects that it proposed. It’s not surprising that it’s taking a couple extra weeks to get to a decision on those five projects.

The Central Coast Broadband Consortium assisted Cruzio with its Equal Access Santa Cruz grant application, and I was a part of that effort. I’m not a disinterested commentator. Take it for what it’s worth.

CASF broadband infrastructure grant resolutions, as approved 5 December 2019:
Cruzio – Equal Access Santa Cruz
Plumas Sierra – Mohawk Vista Mid-Mile/Last Mile
Plumas Sierra – Elysian Valley Mid-Mile/Last Mile
Plumas Sierra – Keddie Mid-Mile/Last Mile
Plumas Sierra – Lake Davis Mid-Mile/Last Mile
Plumas Sierra – Eureka Mid-Mile/Last Mile

CASF broadband infrastructure grant resolutions bumped to 19 December 2019:
Charter Communications – Highland Orchid Drive, Country Squire Mobile Estates , Silver Wheel
Frontier Communications – Northeast Project: Phase1
Frontier Communications – Taft Cluster

All documents collected in 2019 regarding the CASF program and projects are here.

Mobile data tests count more than maps, as CPUC votes on broadband subsidies for northeastern California

by Steve Blum • , , , ,

Plumas eureka

A sharp-eyed reader of this humble blog spotted a gap in my collection of comments on the draft resolutions up for a vote tomorrow. H/T to David Espinoza, the manager of the Upstate and Northeast California broadband consortia, who sent me Plumas-Sierra Electric Co-op’s (PSEC) response to both the draft resolutions for its five proposed projects in Plumas and Lassen counties and the objections raised by the CPUC’s public advocates office. Links are below.

Short version: mobile broadband tests showing zero coverage trumped map models; PSEC added a low-income service plan and CPUC staff recommended extra funding as a result.

The big issue is whether or not one of PSEC’s projects – a proposal to serve 125 homes in the Lake Davis area of Plumas County – is located in an area that has no broadband service at all, other than satellite or dial-up. According to the CPUC’s published map, mobile broadband service is available there, so the project was deemed ineligible for bonus money. In its comments, PSEC provided test data that shows zero broadband availability from any of the four major mobile carriers. The discrepancy might be due to the time of year the CPUC took measurements. As PSEC pointed out

Foliage and tree canopy attenuates radio waves, causing signal degradation, particularly in rural forested areas; especially in fall and winter seasons. Topography also impacts mobile coverage. This Project is in rough terrain with dense tree coverage, resulting in less than adequate mobile coverage.

Based on the Broadband Map, the latest mobile coverage testing was carried out in 2017. It is likely that mobile testing was carried out by CPUC when weather was benign. However, deep in fall and winter seasons actual coverage and speed levels can be significantly less due to weather precipitations and winds.

CPUC staff accepted PSEC’s test data, and the draft resolution was revised, with the extra funding for completely unserved areas added back in.

The PAO objected to the price of PSEC’s proposed plan for low income residents, which also resulted in a lower subsidy amount. PSEC’s answer was to say okay, $15 a month it is. The subsidy bonus that goes along with low income service offerings was added back into the draft resolution.

I’m not a disinterested commentator, so take it for what it’s worth. I provided very minor assistance to Dr. Espinoza, who did the heavy lifting on the response to the original draft Lake Davis resolution. Congratulations to him and the team at PSEC on well-played applications for five needed projects.

Revised draft resolutions, 4 December 2019:
Plumas Sierra – Mohawk Vista Mid-Mile/Last Mile
Plumas Sierra – Elysian Valley Mid-Mile/Last Mile
Plumas Sierra – Keddie Mid-Mile/Last Mile
Plumas Sierra – Lake Davis Mid-Mile/Last Mile
Plumas Sierra – Eureka Mid-Mile/Last Mile

Comments
Plumas Sierra Electric Co-op – comments on the Plumas Sierra – Plumas Sierra – Lake Davis Mid-Mile/Last Mile, 20 November 2019

Plumas Sierra Electric Co-op – comments on the Plumas Sierra – Eureka Mid-Mile/Last Mile project, 21 November 2019

Plumas Sierra Electric Co-op – comments on the Plumas Sierra – Elysian Valley Mid-Mile/Last Mile project, 22 November 2019

Plumas Sierra Electric Co-op – reply comments on the Plumas Sierra – Keddie Mid-Mile/Last Mile project, 27 November 2019

Plumas Sierra Electric Co-op – reply comments on the Plumas Sierra – Mohawk Vista Mid-Mile/Last Mile project, 27 November 2019

All documents collected in 2019 regarding the CASF program and projects are here.

California broadband subsidies set for CPUC vote, as Charter attempts last minute hit (but not on its own grants)

by Steve Blum • , , , ,

As of last night, all 11 broadband infrastructure projects tentatively approved for subsidies from the California Advanced Services Fund (CASF) are slated for a final vote by the California Public Utilities Commission on Thursday. Arguments for and against the projects and grant conditions as drafted have also been filed. Links to (I think) all of the comments are below.

Frontier Communications made pitches for full funding of their projects as proposed, which were seconded by the California Emerging Technology Fund. Charter Communications made a similar plea, then went on to complain about two other projects – Frontier’s proposal for the Taft area of Kern County and Cruzio’s application for money to extend fiber to the premise service to several low income mobile home communities in Santa Cruz County.

Last June, Charter filed objections to both projects, claiming it already offered broadband service to the specific areas of the communities for which Cruzio and Frontier sought CASF subsidies. CPUC staff upheld some of Charter’s challenges and denied others. The new CASF rules adopted by the commission last year established a quick and transparent process for reviewing objections made by incumbents, which fixed a serious flaw in the CASF program – incumbents were allowed to endlessly challenge proposed projects that threatened their monopoly business models, right up to the eve of a commission vote.

The Central Coast Broadband Consortium responded to Charter’s intransigence (full disclosure: I drafted and submitted those comments) by pointing out that allowing perpetual litigation would lead to failure…

Applicants must spend time and money, often amounting to hundreds of thousands of dollars, to prepare and process CASF infrastructure grant proposals. When faced with this significant expense, applicants must weigh it against the probability of success. Previously, the unlimited challenge opportunities afforded incumbent service providers acted as a significant barrier to independent project development. The experience of project applicants who hazarded this process convinced some to never attempt it again. After witnessing these travails, other independent service providers refused to participate in the program.

[The CPUC’s reboot of the CASF program] was wisely crafted to prevent de facto discrimination against independent service providers because their participation in the CASF program is essential to achievement of the program’s goals. Contravening [this decision] by allowing Charter to re-litigate its opposition to the Equal Access Santa Cruz project would, in turn, contravene the Commission’s responsibility to achieve those goals, as required by [California law].

We submitted largely identical comments regarding Frontier’s Taft project.

The CPUC’s public advocates office also weighed in, particularly concerning whether companies receiving grants should be required to offer low income customers affordable broadband rates and whether rules regarding price commitments for all subscribers should be followed – they’re in favor of both.

The next step is for staff to consider all the comments and replies, and make any changes to the proposed grants that seem necessary. The revised draft resolutions should be posted in the next couple of days, although it’s also possible that the commission’s vote could be bumped to a later meeting.

Charter Communications comments on the Charter Communications Highland Orchid Drive, Country Squire Mobile Estates, Silver Wheel projects, 21 November 2019
Public Advocates Office – comments on the Charter Communications Highland Orchid Drive, Country Squire Mobile Estates , Silver Wheel projects, 21 November 2019
Charter Communications – reply comments on the Charter Communications Highland Orchid Drive, Country Squire Mobile Estates, Silver Wheel projects, 26 November 2019

Charter Communications – comments on the Cruzio Equal Access Santa Cruz project, 25 November 2019
Central Coast Broadband Consortium – comments on the Cruzio Equal Access Santa Cruz project, 25 November 2019
Central Coast Broadband Consortium – reply comments on the Cruzio Equal Access Santa Cruz, project 2 December 2019

Charter Communications – comments on the Frontier Communications Taft Cluster project, 25 November 2019
Frontier Communications – comments on the Frontier Communications Taft Cluster project, 25 November 2019
California Emerging Technology Fund – comments on the Frontier Communications Taft Cluster project, 25 November 2019
Central Coast Broadband Consortium – reply comments on the Frontier Communications Taft Cluster project, 2 December 2019

Frontier Communications – comments on the Frontier Communications Northeast Project: Phase1 project, 21 November 2019
California Emerging Technology Fund – comments on the Frontier Communications Northeast Project: Phase1, project, 21 November 2019

Public Advocates Office – comments on the Plumas Sierra – Mohawk Vista Mid-Mile/Last Mile project, 25 November 2019
Public Advocates Office – comments on the Plumas Sierra – Elysian Valley Mid-Mile/Last Mile project, 25 November 2019
Public Advocates Office – comments on the Plumas Sierra – Keddie Mid-Mile/Last Mile project, 20 November 2019

All documents collected in 2019 regarding the CASF program and projects are here.

USA Today says the slowest rural broadband is in California. The truth is even worse

by Steve Blum • , , ,

San benito pole route 13apr2019

USA Today fell for a click bait post about rural broadband speeds, but at least it was click bait that made a useful point about the growing gap between rural and urban service levels.

The top line, of the USA Today article and the post on an Internet-oriented aggregator website, is that Newcastle, along Interstate 80 in Placer County, has the slowest rural broadband service in the U.S., with an average download speed of 3.7 Mbps. That figure comes from speed tests conducted on another aggregator site.

That’s bad, but it’s not close to being the bottom of barrel.

A quick look at the data I have handy – the provider service reports collected by California Public Utilities Commission and current as of 31 December 2017 – shows that out of the 1,513 incorporated cities and census designated places in California, 184 have zero broadband service according the telephone and, sometimes, cable companies that serve them. sixs others have reported download speeds – both maximum and average – of less than 3.7 Mbps.

Reported speeds are what AT&T and Frontier Communications sell you. Measured speeds – what you actually get – are less, and the maximum speed in a town is usually only available near the telco central office. Cable coverage, whether it’s big boys like Charter and Comcast, or smaller providers like Wave, is usually restricted to neighborhoods where customers and money are sufficiently dense.

Newcastle provides an excellent illustration of this discrepancy. Wave reports service levels of up to 1 gigabit there, and AT&T claims a maximum download speed of 25 Mbps, with a 19 Mbps average throughout the town. The graphic below shows AT&T’s broadband holes in Newcastle, at least the ones they own up to. There’s no way of assessing the validity of the 3.7 Mbps click bait figure, but it certainly reflects the subjective experience of residents, as the anecdotal evidence in the USA Today article shows.

So Newcastle’s broadband service is bad, but it isn’t the worst in California, let alone the entire U.S. Based on the CPUC’s data, out of 1,513 communities, Newcastle has the 518th fastest average download speed and the 584th fastest maximum download speed. It ranks even higher when only residential service is considered.

Two-thirds of Californian communities have slower download speeds than Newcastle, which USA Today says has the slowest broadband service in the U.S. That’s a problem that needs fixing.

Newcastle cpuc map 27nov2019

I’ll be crunching the next round of CPUC data, current as of 31 December 2018, in the next few weeks. We’ll see if anything has changed.

Frontier digs a deeper digital divide in rural California with taxpayers’ shovel

by Steve Blum • , , , ,

Frontier verizon pole santa barbara county 10oct2015

A handful of rural communities in Lassen, Modoc and Kern counties will get their first taste of wireline broadband service from Frontier Communications if the California Public Utilities Commission approves infrastructure construction grants next month.

Unfortunately, it’s just a taste.

Frontier’s (and AT&T’s) strategy, as identified by a CPUC study earlier this year, of “disinvesting in infrastructure overall”, which is “most pronounced in the more rural and low-income service areas”, continues to be business as usual. Both of Frontier’s projects up for California Advanced Services Fund grants propose to deliver low speed service over ageing copper telephone lines. The $11 million would be spend on a desperately needed 137 mile fiber route and essential central office equipment upgrades, but Frontier’s interest in improving rural infrastructure, even when taxpayers are picking up the tab, ends there. As the CPUC’s draft resolution approving the Kern County grant describes the project, “Frontier will upgrade the existing communications facilities to increase broadband capacity but will not replace the copper cable infrastructure”. Likewise, the northeastern California project adds middle fiber and electronic equipment, but leaves “legacy copper infrastructure” in place.

It’s not an accident or anomaly. It’s deliberate.

Frontier continues to bleed customers and revenue, and selective fiber upgrades are the solution, according to CEO Dan McCarthy, who spoke about the company’s third quarter 2019 financial results

We achieved a sequential improvement in fiber net losses with only 1,000 in the third quarter. However, consumer copper losses of 52,000 were worse than the second quarter. In copper, although we experienced a sequential increase in gross additions, this was offset by a sequential increase in churn and we continue to manage this business for a decline. Fiber broadband gross additions increased sequentially in the third quarter and we also had a slight sequential improvement in fiber broadband churn. With the completion of the upgrades of the fiber network to be 10 gigabit capable, we have increased our emphasis on selling at higher speed tiers.

Frontier’s strategy is economically rational, and is probably its best shot at pulling shareholder value out of penny stock territory. What makes it rational, though, is the California legislature’s irrational (but well compensated) decision to subsidise 1990s era broadband service over 1890s era copper wires, and not hold incumbent telcos to the same standards in rural communities as they voluntarily and rationally adopt in densely populated, high income cities and suburbs.

CPUC queues up $24 million subsidy for 11 California broadband projects

by Steve Blum • , , , ,

Mobile home park

Eleven broadband infrastructure projects by four companies will be considered by the California Public Utilities Commission next month. Draft resolutions approving California Advanced Services Fund (CASF) subsidies for 11 out of the 13 grant proposals submitted in the May application window were posted on Thursday. The drafts are linked below.

Making the CPUC’s new six month deadline for processing applications is a major milestone for staff, and they deserve congratulations. In the past, reviews have sometimes dragged on for years, with endless and often meritless challenges allowed from marginal broadband providers who wanted to fence off service-poor communities. There was mischief this time around – Digital Path, a wireless ISP, tried to claim a vast swath of northeastern California for example – but challenges were rigorously vetted.

The 11 grants total $23.8 million. The projects would extend broadband service to 1,219 homes, for an average subsidy of $19,500 each. There’s wide variance within that average, though, largely due to where those homes are.

Casf grant totals draft resolution 31oct2019

Frontier Communications is up for $11.1 million, which would pay for VDSL upgrades for the 263 homes in Modoc and Lassen counties in northeastern California and the Taft area in Kern County. According to Frontier, the technology is capable of delivering broadband speeds of up to 115 Mbps download and 7 Mbps upload, but the company is only promising to provide the CASF program’s absolute minimum of 10 Mbps down/1 Mbps up.

Plumas-Sierra Rural Electric Co-op is in line for five grants in Plumas and Lassen counties, totalling $8.9 million. Most of the 414 homes will receive direct fiber-to-the-premise service at a minimum of 100 Mbps down/20 Mbps up, although the system will be able to deliver symmetrical gigabit service. One of the projects, in Lake Davis in Plumas County, is a combo fiber and wireless build, with about half the homes receiving fixed wireless broadband service at the minimum of 10 Mbps down/1 Mbps up.

Cruzio, an independent Internet service provider based in Santa Cruz, has one grant for $2.4 million on the table. It targets 263 homes in seven mobile home parks in Santa Cruz County. It’s a full fiber-to-the-premise project, with symmetrical, 1 Gbps down and up promised.

Charter Communications has three grants totalling $1.4 million pending. The projects would extend its hybrid fiber coax plant to two mobile home parks in Riverside and Ventura counties and a neighborhood in Highland in San Bernardino County. The company promises to provide a minimum of 940 Mbps down/35 Mbps up speeds to a total of 279 homes. The draft resolution would also give Charter a pass on the CASF program requirement that monthly subscription prices, for at least some of a grant recipient’s broadband service tiers, be guaranteed for at least two years. A second exception requested by Charter – that it be allowed to charge for equipment and installation – was denied.

The $23.8 million total is $8.3 million less than originally requested for the 11 projects. Most were scaled back, for a variety of reasons including challenges from existing providers, overlaps with federally subsidised areas and due diligence verifications by CPUC staff. Two grant applications – one by Charter in Riverside County and another by Web Perceptions, a local wireless ISP in Sonoma County – are missing from Thursday’s batch. Charter’s proposed project in Perris in Riverside County was challenged by Frontier (and Charter returned the favor for Frontier’s Taft project, albeit only with partial success). Web Perceptions’ application wasn’t challenged but, judging by the publicly available information, it was poorly prepared. It’s a fair assumption that both were denied, but there’s no official word.

The Central Coast Broadband Consortium assisted Cruzio with its Equal Access Santa Cruz grant application, and I happily participated in that effort. I’m not a disinterested commentator. Take it for what it’s worth.

Charter Communications – Highland Orchid Drive, Country Squire Mobile Estates , Silver Wheel
Cruzio – Equal Access Santa Cruz
Frontier Communications – Northeast Project: Phase1
Frontier Communications – Taft Cluster
Plumas Sierra – Mohawk Vista Mid-Mile/Last Mile
Plumas Sierra – Elysian Valley Mid-Mile/Last Mile
Plumas Sierra – Keddie Mid-Mile/Last Mile
Plumas Sierra – Lake Davis Mid-Mile/Last Mile
Plumas Sierra – Eureka Mid-Mile/Last Mile

CPUC approves DSL upgrade subsidy for Frontier at $4,700 per home

by Steve Blum • , , , ,

Weimar casf project

The California Public Utilities Commission approved a $693,000 grant to Frontier Communications from the California Advanced Services Fund (CASF) for a DSL equipment upgrade in the Placer County community of Weimar earlier this month. It was a considerably smaller grant than Frontier requested.

The project originally included the somewhat larger town of Colfax and called for a CASF subsidy of $2.3 million to reach 1,400 homes that, Frontier said, lacked access to broadband service at California’s pathetic minimum of 6 Mbps download and 1 Mbps upload speeds. Other Internet service providers in the area begged to differ, however. Two wireless ISPs, Colfax.net and SmarterBroadband, which have made a habit of blocking wireline upgrades, challenged Frontier’s request, as did the local cable operator, Wave. As a result more than two-thirds of the budget and nearly 90% of the households were chopped, and the cost jumped to $4,700 per premise…

Staff notes that this is a DSL project, and the cost would be higher compared to other DSL projects approved by the Commission. The total number of households for this project is 148, which is significantly less compared to other Frontier DSL projects that range from 234 to 1,017 total households. The higher cost per household is due to the low density of eligible households in the project area. Further, in addition to the equipment upgrades to the Weimar Central Office, Frontier must also upgrade equipment facilities at its Colfax Central Office in order to serve the Weimar project area. Due to the additional equipment upgrades required in Colfax, the cost per household increased by $1,000 overall.

Frontier gave up federal money for the area, in order to maximise its Californian subsidy, which covers 90% of the construction cost for the DSL central office upgrade and 1,000 feet of new fiber, apparently for a lateral connection to a middle mile route. Frontier is only promising the minimum performance level for CASF funded projects of 10 Mbps down/1 Mbps up, but CPUC staff “estimates 50 percent of CASF-eligible households are within roughly 5,000 feet of Frontier’s terminals and should expect very fast service (25 Mbps to a maximum of 115 Mbps)”.

Frontier’s financial woes rated a mention, but didn’t raise any concerns. The CPUC resolution concluded that Frontier “has managed to stabilise its revenue and made significant efforts to reduce debt and improve its financial leverage profile”.

Faster broadband gains subscribers but slow service loses them, CenturyLink says

by Steve Blum • , , ,

Centurylink building

CenturyLink confirmed earlier this month that faster broadband service is the pathway to keeping subscribers on board, and gaining new ones.

In the company’s presentation outlining its second quarter 2019 financial results, it noted that it lost a total of 56,000 consumer-grade broadband customers. However, when that top level figure is broken out by speed, the company gained 48,000 subscribers at the 100 Mbps download speed level or better. The negative subscriber numbers were all at lower speeds: a net loss of 26,000 subscribers who were taking service at speeds levels of from 20 Mbps to less than 100 Mbps, and a loss of 78,000 subscribers who were buying service slower than 20 Mbps.

CenturyLink’s gains in the 100 Mbps or better category are accelerating. According to the Seeking Alpha transcript of CenturyLink’s second quarter conference call with analysts, chief financial officer Neel Dev said “growth in our greater than 100 meg subs is up more than 100% on a year over year basis”.

Fiber build outs are the key to CenturyLink’s future success, according to CEO Jeff Storey. Fiber is “highly flexible and increasing speeds, it is secure and really is the basis for all the other competing technologies”, he said. “We take fiber all the way to the customer, and customers always want fiber when they can get it”.

Still, CenturyLink is losing consumer broadband customers overall, nearly as rapidly as Frontier Communications, which lost high and low speed customers alike last quarter. Both companies took hits on Wall Street after second quarter results were announced, continuing a trend that began a year ago for CenturyLink – it’s lost about half its share value since then. Frontier, on the other hand, lost nearly half its already depleted market value following its second quarter conference call – dropping from $1.23 a share to a low of 68 cents, before starting to climb back a week ago. Yesterday Frontier closed at 84 cents a share, less than 30% of what it was worth at the end of April, and still in penny stock range.