Frontier's fiber follies fed its financial fate
On the cusp of a reorg and a possible bankruptcy filing, Frontier Communications acknowledged that a "significant under-investment" in fiber and an over-reliance on DSL played critical roles in putting the company in its currently tenuous position.
"Significant under-investment in Fiber deployment and limited enterprise product offerings have created headwinds that the Company is repositioning itself to reverse," Frontier explained in this presentation to investors (PDF).
Frontier, which could file for Chapter 11 by April 14, believes a reorg and a revised strategic vision, which includes fiber upgrades, will improve the company's outlook.
Under strategic initiatives being weighed, Frontier envisions new fiber builds to about 3 million incremental households, with about $1.4 billion in estimated cumulative build capex requirements through 2024. On the wireless backhaul side, Frontier is envisioning about 9,000 new sites won by 2024.
Frontier noted that 29% of its residential broadband housing units are served on fiber, with the rest on DSL – 6% on "fast" DSL (greater than 24 Mbit/s), 35% on DSL at speeds between 13 Mbit/s to 24 Mbit/s, and 30% on DSL speeds up to 12 Mbit/s. About 11 million of the 14 million homes served by Frontier's are on DSL (or 79%), with the remaining 3 million (or 21%) on fiber.
In a 10-K filing, Frontier acknowledged that its ability to "continue as a going concern is dependent" on its ability to restructure with enough liquidity to meet its obligations and operating needs. Discussions on a restructuring got underway in January.
For more about Frontier's current situation and its plans to reorg, please see this story at Light Reading: Frontier inches toward bankruptcy .
— Jeff Baumgartner, Senior Editor, Light Reading, special to Broadband World News
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