Frontier Communications wrapped its $2 billion acquisition of AT&T wireline business, statewide fiber network, U-verse operations, and Dish Network customers in Connecticut, marking the occasion with service interruptions in both broadband and TV.
The deal was announced at the end of 2013. AT&T said it sold those operations because its business in the Northeast “is increasingly comprised of wireless and advanced communications solutions for business customers.”
Local news outlets reported over the weekend that some customers, including some business customers, had their Internet service severed with the transition. Customers have taken to Facebook and other social media complaining not only about interruptions in broadband, but also seemingly widespread problems with delivery of television service, which the company acknowledged and said it is working on.
In a statement announcing the completion of the sale, Frontier CEO Maggie Wilderotter said, “We offer great broadband products that include customer protection for their online experience. Frontier is a leader in offering comprehensive end-to-end online protection. It sets Frontier apart, and it demonstrates that focusing on our customers will maximize shareholder value.”
AT&T CEO Randall Stephenson said, “Frontier’s solid reputation and track record for providing high-quality products and service to customers across the country was a major consideration in our decision to sell them our Connecticut operations.”
Frontier acquired approximately 415,000 data, 875,000 voice, and 215,000 video connections in Connecticut. Those numbers were from the close of the second calendar quarter, and include AT&T’s local business connections and existing carrier wholesale relationships. Approximately 2,500 former AT&T Connecticut employees will end up with Frontier.
Frontier said it plans to invest $63 million over the next three years for U-verse expansion and broadband network speed enhancements to increase speeds to 10Mbps or greater for more than 100,000 households.
It said it will also construct an ultra-high-speed middle mile fiber network connecting central offices across the state and dedicate at least $3 million of capital to expanding broadband to areas currently unserved or underserved.
With its new operations in Connecticut, Frontier now provides service in 28 states.
Separately, the company has begun offering gigabit speeds in some service areas, and recently added some neighborhoods in and around Durham, N.C., and some suburbs of Portland, Ore., to the list.
Frontier is using equipment from both Calix and AdTran to support data transport at rates up to 1 Gbps.
Frontier said speeds up to1 Gigabit are immediately available to business and residential customers in Carolina Arbors, American Tobacco Campus, Durham City Center, Research Triangle Park – Park Center Development, One Park Center, and Jordan at Southpoint – all in North Carolina.
The faster service rates follow an investment of more than $80 million to upgrade and enhance Frontier’s North Carolina network over the last few years Wilderotter said.
The company is making the same offer of 1 Gigabit speeds to residential customers in select neighborhoods of Beaverton, Ore.
More areas will be announced in Oregon through next year, the company promised.
Frontier purchased Verizon’s FiOS operations in Beaverton and nearby areas in 2010 for $8.6 million, picking up about 300,000 customers in the deal.
The company was offering speeds up to 100Mbps to households in its FiOS footprint, which includes Beaverton, and nearby towns of Forest Grove, Gresham, Hillsboro, McMinnville, Newberg, Sherwood, Tigard, Tualatin, and Wilsonville.
Wilderotter said Frontier has invested more than $128 million to upgrade and enhance its network in Oregon.
Frontier’s investment in the former FiOS network has been modest. Furthermore, it originally seemed to have been trying to discourage new sign-ups, with Oregon regulators saying the company had imposed $500 installation fees (there are no longer any installation fees). Analysts said supporting FiOS television service was particularly costly.
Frontier is stringing fiber to the home and using GPON for delivery, a spokesman confirmed. In Oregon, the company is relying largely on Calix as a supplier.