Yesterday, Frontier (NYSE: FTR) began new chapter of their life in the telecom history books with the completion of its acquisition of Verizon's (NYSE: VZ) rural lines in 14 states.
When Connecticut-based Frontier got the FCC's blessing to wrap its purchase of Verizon's rural lines (lines that Verizon had been eager to offload because they are less strategic) in May, the independent ILEC in one fell swoop instantly advanced its standing amongst the three largest remaining independent ILECs.
After all is said and done, Frontier will now serve 4 million residential, including FiOS, and business customers in 27 states. Since getting the FCC's blessing of the deal, the Connecticut-based service provider has been aggressively on the campaign trail telling customers they'll be there for them.
First on the list was FiOS. Frontier may have not gone public with its own FTTH plans, but under the obligations set with regulators to get approval of the Verizon deal, it will have to maintain existing and planned FiOS commitments. The service provider put a FAQ page on its site about support for FiOS.
Frontier's first test will come in West Virginia. As Frontier's largest service territory, West Va. will be the first region to be cutover from the Verizon systems onto its own. In addition to making West Va. the first region to be cutover, Frontier has committed over $310 million to not only improve PSTN quality, but also expand broadband availability throughout the state.
No less important is proving its viability to business customers. Just this past week, Frontier highlighted nine business customer wins in various states. I don't think it was coincidence that this announcement came only two days before it officially completed the acquisition. Existing business and new customers that reside in Frontier's new markets could potentially trade notes with these business customers to quell concerns over the ongoing transition from Verizon.
Given the protests to the deal from union and consumer groups, in various states, including West Virginia, Frontier will need continue to put its words to action and ensure that even if many of the changes it has to initially make to back office or administration (e.g., the transfer of Verizon technicians into its fold) will have minimal effect on the customer base it's acquiring.
As told by Ken Arndt, Senior Vice President and General Manager, Frontier Communications Eastern Region, when asked about what effect the acquisition will have on West Virginia customers--the first market to be switched over from Verizon's systems to Frontier's--is transparency.
"All of the changes are happening on the back end that the customer does not actually see," he said.
Arndt is right. With any major acquisition of the size of Frontier's, issues that weren't initially foreseen are inevitably going to pop up. The key test, however, for Frontier will lie in its ability to not only communicate these issues, but get them resolved in a timely manner with minimal effect on the customer base.--Sean
P.S. The FierceTelecom team is not publishing on Monday so we can practice our backyard barbecue skills in celebration of the Fourth of July holiday. We'll be back on Tuesday, July 6, bringing you the latest news in the wireline segment of the telecommunications industry. Have a great Fourth of July holiday.