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Frontier Buys All AT&T Landline Operations in Connecticut
by Karl Bode 10:03AM Tuesday Dec 17 2013 Tipped by limegrass69 See Profile
Frontier Communications has announced that the company will be buying AT&T's fixed-line networks in Connecticut in a deal estimated to be worth around $2 billion. According to the companies' press release, the deal will involve all AT&T residential (both DSL and U-Verse), commercial and wholesale customers in Connecticut. All told, Frontier should acquire around 415,000 broadband customers (including 245,000 U-verse users), 900,000 voice subscribers, and 180,000 residential video users.

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"We see an opportunity to enhance broadband capabilities in Connecticut," Frontier CEO Maggie Wilderotter said in a statement. "This transaction demonstrates our continued commitment to enhancing shareholder value by improving the sustainability of our dividend, increasing our free cash flow and building on our core product and service strengths."

Verizon, like AT&T, has been busy trying to back away from fixed-line customers in markets they don't want to upgrade in order to focus primarily on more profitable wireless service. AT&T has been shopping around a number of unwanted markets for several years. Where they can't sell, AT&T's attempting to gut unwanted regulations in order to simply walk away from unwanted users sometime in the next few years.

Frontier, meanwhile, continues to grow at an amazing rate as they gobble up the users AT&T and Verizon don't want. The company acquired 4.8 million access lines in 14 states from Verizon in a deal valued at $8.6 billion back in 2009. Verizon got the better end of that arrangement, not only getting a massive tax write off while shedding debt, but they then got to come back into those markets and sell fixed line LTE services to many still un-upgraded DSL users in those markets.

It wasn't clear Frontier was going to be game for another such deal after Verizon, but AT&T's all-cash offer and the ability to grow further, faster was clearly too tempting for Frontier.


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PX Eliezer
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reply to TBBroadband

Re: What % of CT is AT&T?

said by TBBroadband:

Cinci Bell is the only RBOC to still use the Bell Logo and the brand "Bell"

As NormanS pointed out, not actually an RBOC.

But I do thank you for mentioning Cincinnati Bell because they are indeed the last surviving US phone company with any type of relation to the Bell legacy, to still use the Bell name.

-----

The only OTHER one had been Malheur Bell, a tiny Bell operating company which served only one COUNTY in Oregon.
»Another Bell System company dies. Bell logo dies too..

elray

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reply to Karl Bode

Re: AT&T Isn't Backing Away from Landlines...

said by Karl Bode:

AT&T itself has admitted precisely what they're doing in a litany of regulatory documents. They are doing some modest investment in U-Verse markets moving forward, but backing away from unwanted copper markets in the hopes they can push those users on to LTE and $15 per GB overages. Again, AT&T has acknowledged this. There's nothing really to debate.

That's just nonsense. $15/GB Overage charges aren't happening in any major way, they aren't going to, and that isn't their business plan or motivation.

There is no surer path to fury than sending Mom a bill with an extra $100 charge on it, and while she will give junior a time-out from his Netflix streaming, her wrath will be taken out on AT&T - permanently and the entire PTA and knitting group will know about it.

Overage charges, or the threat of them, exist to shape and contain behavior, they are not designed for profit potential.

Telcos want consistent rents, not one-off charges that cost them the customer. The move towards fixed-LTE is about lowering overhead and raising those rents from their regulated wired floor, but NOT overage charges.


Kushnick

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The History of SNET --- pay for fiber, get copper, get hosed.

SNET Lines sold to Frontier -- DSL Reports: The history of SNET: charge customers for fiber, use the old copper...
_____________________________________

According to the 1996 Annual Report:

“I-SNET(sm) is… a statewide telephony and information superhighway. Since 1994, the wireline business has been replacing its existing network of twisted copper wire with low maintenance fiber-optic and coaxial cable. The buildout of I-SNET, a $4.5 billion investment, is expected to be completed by 2007. This advanced network is capable of delivering voice, video and a full range of information and interactive multimedia services.”

1) SNET made commitments to rewire the entire state with fiber coax to homes, completed by 2007.—This was cable competition and more.

2) SNET also filed with the FCC known as “Video Dialtone,” which was the same fiber optic plan, but presented on the federal level. SNET was granted permission for 1,000,000 homes.

3) SNET was part of a cabal called Americast which included SBC, Disney, BellSouth and Ameritech. (Pac Bell, Bell Atlantic and NYNEX were part of “Tele-TV”) and so the same scam happened in Oh, Il, IA, WI, MI, PA, NJ, SNET, MA, MD, DE, DC, and some BellSouth states.

4) State Regulations were changed from a ‘Rate of Return” to an alternative form of state regulation to give the company more money for construction. “In March 1996, the DPUC issued a final decision that replaces traditional rate of return regulation with alternative (price based) regulation to be employed, effective April 1, 1996”

5) The company took a one time $1.2 billion dollar tax deduction “FASB 71” claiming that because of changes in state law the company could take major write-downs of the old plant, and speed up the depreciation for new technology, replacing the copper with fiber

6) September 25, 1996 SNET is granted the first statewide video franchise in the United States, I-SNET to all customers. claiming by 2007 ALL subscribers were to have cable service competition via fiber-coax:

Outcomes:

7) SBC (NOW AT&T) merged with SNET 1998 and closed all of the SNET fiber video projects after the purchase, as it had done to California, Ameritech, and other states. It had 30,000 cable customers.

8) Competitors applied to use the fiber –coax that was laid—SBC refuses and a court case goes on for years. – never lit after the fiber after it was bought, competitors couldn’t use it.

9) 2006 SBC applies again for statewide service to offer U-Verse over the old copper wires.

10) Billions of dollars were charged and keep being charged to customers for fiber optic service services that were never received. SBC-AT&T harmed the entire state of Connecticut.


PX Eliezer
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reply to camper

Re: What % of CT is AT&T?

said by camper:

All of CT (with the exception of a private phone company in the northern part of the state) had been SNET (Southern New England Telephone). A number of years back, AT&T bought SNET.

Right.

To be technical though---The Southern New England Telephone Company was purchased in 1998 by SBC Communications. SBC subsequently purchased the old AT&T, taking its name as the "new" AT&T.

SNET (and Cincinnati Bell also) were never majority-owned by the old Bell System, they were thus never considered RBOC's.