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”.