The pandemic magnified the need for broadband connections everywhere. That put the onus on the traditional telephone and cable companies and internet service providers to ramp up their network investments in broadband, primarily for fiber connections to homes and small businesses.
In the U.S, AT&T (NYSE: T) and Verizon (NYSE: VZ), besides being leading mobile network operators, are the major incumbent local exchange carriers (ILECs) that are expanding both wired and wireless broadband connectivity. At the same time, three public ILECs that serve mainly smaller metro and rural areas around the country are stepping up their own fiber builds for 1+ Gbps, symmetrical service.
Frontier Communications (NYSE: FYBR) headquartered in Norwalk, CT, has operations in 25 states with more than 15.4 million consumer broadband-enabled locations. At the end of 1Q22, FYBR had approximately 3.2 million total customers, including 2.8 million broadband subscribers of which 1.4 million were fiber connections. For the quarter, total revenues were $1.4 billion with fiber revenue accounting for 46 percent of the total. That figure was down 11 percent YoY, on declines in voice and video revenues.
FYBR’s FY2022 midpoint capex guidance is $2.45 billion, affirming its accelerated fiber network build to reach 10 million total passings by the end of 2025. With a record 211,000 new locations passed in 1Q22, the company expects to deploy over 1 million new passings in 2022, with over 5 million total fiber locations passed by year-end.
Lumen Technologies (NYSE: LUMN) based in Monroe, LA, has domestic ILEC operations in 16 states. Its Quantum Fiber brand promotes fiber-to-the-premise for small business and residences; the CenturyLink brand covers legacy copper-based services.
Mass Market segment revenues in 1Q22 were $1.3 billion or 27 percent of total sales. This segment provides copper- and fiber-based local access products and services to 4.6 million total consumer broadband subscribers, with nearly 2.7 million homes-passed with fiber.
LUMN’s FY2022 mid-point guidance is Adjusted EBITDA of $6.6 billion and $3.3 billion in capex. It expects to ramp Quantum Fiber at a 1-2 million annual passings run rate through 2025, with a total addressable opportunity of over 12 million locations in urban and suburban areas.
Mattoon, IL-based Consolidated Communications (NASDAQ: CNSL) provides residential broadband and business data and transport services to consumers, businesses, and wireless and wireline carriers. CNSL operates as an ILEC with approximately 2.7 million total passings in metro and rural markets in 23 states.
In 2021, CNSL launched a multi-year, FTTH build plan to upgrade 1.6 million passings or 70 percent of its service area to 1+ Gbps fiber-enabled services by 2025. At the end of the quarter, the company reached nearly 690,000 Fiber Gig+ capable passings and 94,000 connections, representing a 14 percent take rate. Under its new Fidium fiber internet brand, CNSL expects to reach 1 million passings in 2022.
The company reported 1Q22 revenues of $300 million and $107 million in Adjusted EBITDA, down 8 and 15 percent, respectively, YoY. Legacy voice and copper/DSL broadband services declined; fiber broadband revenues grew by 22 percent. CNSL’s FY2022 guidance is $418 million for Adjusted EBITDA and $485 million for capex.
By John Celentano, Inside Towers Business Editor