Frontier Agrees To Fiber-Network Expansion In Plan To Exit Bankruptcy (arstechnica.com) 22
An anonymous reader quotes a report from Ars Technica: Frontier Communications has agreed to expand its fiber-to-the-premises network and improve its poor service quality as part of a bankruptcy settlement in California. Frontier committed to deploy fiber to 350,000 homes and businesses within six years on a schedule that would require the first 100,000 by the end of 2022, 250,000 by the end of 2024, and the full 350,000 by year-end 2026. The settlement, filed in late December, is pending approval by the California Public Utilities Commission (CPUC). Frontier agreed to the terms with the Communications Workers of America (CWA), a union that represents Frontier employees; The Utility Reform Network (TURN), a consumer-advocacy group; and Cal Advocates, the public advocate office at CPUC.
To ensure that Frontier doesn't build only in wealthy areas, the 350,000-location deployment must include 150,000 customer locations where Frontier estimates it would receive less than a 20 percent "internal rate of return." For those 150,000 locations, Frontier will have to consult with the CWA, TURN, Cal Advocates, and tribal government leaders "to discuss the potential areas for deployment, including tribal lands and tribal communities," the settlement said. "As part of the proposed settlement, Frontier will be required to spend at least $1.75 billion over the next four years on service quality and network enhancement projects, as well as provide a detailed plan with input from CWA, TURN and Cal Advocates that identifies needs like plant repair, maintenance, hiring, and how Frontier intends to address them," the CWA said in a press release last week. The union said it also "secured a commitment from Frontier to maintain its total employee technician staffing in California over the next three years, and to maintain ten call center locations across the state."
Another settlement clause requires Frontier to spend $11.6 million over four years to deploy 25Mbps download speeds at 4,000 additional locations on tribal lands. The required upload speeds for this buildout are only 2Mbps, so it likely wouldn't involve fiber-to-the-home. But tribal areas should get some fiber as part of Frontier's requirement to deploy at 150,000 low "rate of return" areas. Frontier agreed to temporary price controls, as it "will not increase residential rates for copper-based standalone voice services, fiber-based standalone basic voice service, copper-based broadband services, and copper-based voice/broadband bundles through December 31, 2021," the settlement said. Frontier will also have to "provide a host of detailed, recurring reports" on network spending, service quality, and broadband commitments to help advocacy groups and the state monitor the company's compliance.
To ensure that Frontier doesn't build only in wealthy areas, the 350,000-location deployment must include 150,000 customer locations where Frontier estimates it would receive less than a 20 percent "internal rate of return." For those 150,000 locations, Frontier will have to consult with the CWA, TURN, Cal Advocates, and tribal government leaders "to discuss the potential areas for deployment, including tribal lands and tribal communities," the settlement said. "As part of the proposed settlement, Frontier will be required to spend at least $1.75 billion over the next four years on service quality and network enhancement projects, as well as provide a detailed plan with input from CWA, TURN and Cal Advocates that identifies needs like plant repair, maintenance, hiring, and how Frontier intends to address them," the CWA said in a press release last week. The union said it also "secured a commitment from Frontier to maintain its total employee technician staffing in California over the next three years, and to maintain ten call center locations across the state."
Another settlement clause requires Frontier to spend $11.6 million over four years to deploy 25Mbps download speeds at 4,000 additional locations on tribal lands. The required upload speeds for this buildout are only 2Mbps, so it likely wouldn't involve fiber-to-the-home. But tribal areas should get some fiber as part of Frontier's requirement to deploy at 150,000 low "rate of return" areas. Frontier agreed to temporary price controls, as it "will not increase residential rates for copper-based standalone voice services, fiber-based standalone basic voice service, copper-based broadband services, and copper-based voice/broadband bundles through December 31, 2021," the settlement said. Frontier will also have to "provide a host of detailed, recurring reports" on network spending, service quality, and broadband commitments to help advocacy groups and the state monitor the company's compliance.
2mbps (Score:2)
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ADSL (1)
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Don't worry, taxpayers will foot the bill (Score:2)
Looking at the figure of $1.75 billion, one would assume Frontier would have to bear the costs. Instead, I would submit to you the recent "relief" package [slashdot.org] for those poor, desperate corporations who can't buy back their stock because they're a bit short on money, includes $7 billion for broadband infrastructure and connectivity.
Rest assured, Frontier will get a nice chunk of that money so it doesn't have to spend its own money, this on top of the potentially billions it's received over the decades from othe
Re: Don't worry, taxpayers will foot the bill (Score:2)
As I recall, the money in the relief Bill a company like Frontier will see is in the form of customer subsidy for unemployed Americans. This is not 'extra' money, it's money they would already collect coming from the give instead of the subscriber.
To explain, let's say I'm unemployed, and let's further say I qualify for the subsidy. My current $85/month ISP bill gets reduced to $35 paid by me, $50 paid by the gov't.
It isn't 'new money,' it's not earmarked for 'network expansion,' but that won't stop headlin
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So what you're saying is taxpayer money will go to Frontier who will use that money for its $1.7 billion service enhancements and network enhancement projects.
Got it.
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No, what I am saying is that the money goes toward customer retention, subsidizing their bills. It is so that the unemployed can keep their Internet service while they search for a job.
We're talking about funds allocated in the Relief/Stimulus bills, not this proposed bankruptcy settlement.
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Every $50/month stimulus subsidy keeps $50 in the pockets of the unemployed, Frontier sees no more and no less money because of this relief.
The $1.75 Billion will most likely be drawn from creditors willing to loan Frontier the money and the loans will be repaid by future customers - if Frontier had $1.75 BN available to it now, they wouldn't be bankrupt.
Just Disband Them Already! (Score:3)
Who on earth would believe anything Frontier (or any other teleco) would promise at this point? If they run their business into the ground, rewarding them is not the right answer.
Sell off their assets to a competent 3rd party or a local government, and get on with life. There's no reason to prop up a company which takes billions of taxpayer dollars, wastes them (well legally embezzles, which is the same thing) and can't even thrive on that. They are not too big to fail, so let them fail. Let someone else do better.
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Well the problem is that's already the situation with the established regional monopolies. So the one reason to prop up a company like this is that we've already been propping up other companies like this, and at this point the only way to stop them is to give them competition amongst themselves.
Internal Rate of Return? (Score:2, Insightful)
To ensure that Frontier doesn't build only in wealthy areas, the 350,000-location deployment must include 150,000 customer locations where Frontier estimates it would receive less than a 20 percent "internal rate of return."
As I read it, for every $100 invested, the network expects to generate $20 in revenue...
Internal Rate of Return - https://www.investopedia.com/t... [investopedia.com]
That doesn't really seem like a path to financial recovery to me... Perhaps this explains why these regions are under-served.
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Go back and read your citation again. Note the "1 + IRR" and consider how that affects things.
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As I read it, for every $100 invested, the network expects to generate $20 in revenue...
No, it's more complicated than that because time is the important factor. More like: For every $100 invested then after 5 years (or some whatever term they use but 5 years is typical) then $20 will have come in by then and be expected to continue indefinitely. So that's why there's stuff like sign up fees. If it takes them a year to lay fiber and then 3 or 4 years to sign up subscribers, then the first 2 or 3 years, that $100 investment had no income at all and needs to make MORE than $20 to average out. S
If only Frontier had good IPv6 service... (Score:2)
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or what? (Score:2)
Frontier would agree to anything to get approvals. What is the downside for them if they don't meet those expectations? And why are terms like "Frontier SHOULD..." being used? There's a lot Frontier should've done... but it would've cost their investors a few bucks so...
Spend how much to do what now? (Score:2)