AT&T and Frontier – feeling the burn from declining customers?

Despite being the only service provider in many parts of the country, Frontier’s stock dropped a whopping 62% in 2017 – and 2018 isn’t looking much better for the company. In fact, earlier this year, Bloomberg reported that Frontier was considering a sale of landline assets in California, Florida and Texas that the company acquired from Verizon. A Frontier sale of the Verizon lines would appear to be a rather desperate act aimed at improving the company’s capital structure.

However, it seems that Frontier isn’t the only telecom in trouble. AT&T’s stock has dropped to lows not seen in about six years, and shares are down roughly 12 percent since the session before its last quarterly announcement. The stock has fallen about 19 percent for the year. This may be why AT&T eliminated their SSR position earlier this week, potentially leaving over 4,200 without a job. This and other job cuts come after the telecom giant received a significant boost from the GOP’s tax law. This has put the company in the spotlight with the labor group, The Communications Workers of America (CWA).

The group estimates that AT&T has cut 7,000 jobs since the tax bill went into effect this year. They accuse the company of using its tax savings to enrich its shareholders and executives rather than investing in workers.

So what’s the deal? Why are these two companies struggling amidst tax cuts and government grants? It is clear that cord cutting has slowly been draining customers from the cable industry in recent years. The numbers have been growing each year, going from 105,000 pay television customers lost in 2013 to nearly 1.5 million in 1017.

This has affected AT&T and Frontier in different ways. AT&T owns both DirecTV and its own U-Verse service. It lost 554,000 DirecTV satellite customers in 2017 and dropped 624,000 U-Verse subscribers. But AT&T also gained 114,000 broadband subscribers, which helped further offset its cable losses.

Frontier did not fare as well. The company lost 184,000 cable customers in 2017. Even worse, it did not post any gains in broadband and dropped 330,0000 subscribers.
This raises an interesting question: What happens if Frontier can’t afford to keep its antiquated network up and running and what does that mean for California consumers?

The company has offered no indications that it’s eyeing cutbacks to network investment or service. Even so, “California consumers should be very concerned,” said Christine Mailloux, an attorney with the Utility Reform Network, an advocacy group.

“All wireline companies are losing customers,” she said. “But they still have obligations that have to be met.”

The Federal Communications Commission requires that any phone company “planning to discontinue or reduce domestic wireline service” must notify customers in advance and continue providing service for up to 60 days after making its intentions clear to authorities.

At the state level, the California Public Utilities Commission defines Frontier as a “carrier of last resort.” That means the company must meet a variety of obligations as a provider of basic phone services, such as reliable voice connections and free 911 access.

Frontier and AT&T are California’s two largest carriers of last resort. About 14 other smaller companies hold the designation in various communities statewide.

Constance Gordon, a spokeswoman for the state PUC, said a carrier of last resort would have to apply to the commission for any financial assistance, such as charging customers higher rates.”And if the carrier were closing down completely, it would need to have a migration plan to ensure that customers have service throughout the exit process,” she said.

That would mean making sure customers find a home either with another wireline phone service provider or with a cable or wireless company.

According to AT&T, the number of California households with landlines has declined by 85% since 1999. But carriers of last resort are nevertheless required to maintain full capacity for their phone networks as if every home still used copper phone lines. This will change as wireline demand disappears. In the meantime, thousands of seniors and low-income people depend on landlines for their communications needs, and they can’t simply be abandoned.

State officials and telecoms will have to oversee a smooth transition from 20th to 21st-century technology. Perhaps AT&T has the size and clout to survive this challenge.

As for Frontier, that remains to be seen.

sources:
https://www.telecompetitor.com/rumored-frontier-sale-of-verizon-lines-a-desperate-act/
http://thehill.com/policy/technology/399214-labor-group-targets-att-gop-candidates-over-post-tax-bill-job-losses
https://www.fool.com/investing/2018/04/24/better-buy-frontier-communications-corporation-vs.aspx
http://www.latimes.com/business/lazarus/la-fi-lazarus-frontier-verizon-landlines-20170718-story.html

Race Communications’ Summer Review.

2018 has been filled with releases, events, and expansion for Race Communications. In May, the company officially opened a new office in Tehachapi, CA where the company has a strong fiber footprint in the outlying communities of Stallion Springs, Brite Valley, Oak Knolls and Bear Valley Springs. Race has hired several local residents to build their marketing and sales team and is revving up their efforts in their service areas in the High Desert and Central Valley.

The month of May also brought the release of the first part of the “Gigafy Phelan” project, a hard-fought project that was approved in July 2017, after years of challenges and obstacles.

Since June 2018, Race has installed 98% of the residents who had previously inquired about service in the released zone – the release came two full months ahead of the initial target date of August 2018. “Gigafy Phelan” was not the only project to be released – the “Gigafy Occidental” project in Northern California was also released and installs began immediately. At this time over 70 percent of the community has signed up for services from Race.

The release of these communities has given Race the momentum to continue their expansion and Race opened a new field operations office in Phelan, CA and marked the occasion with a BBQ Kick-Off and ribbon cutting ceremony on July 21st. The company was recognized by Congressman Cook’s office for their efforts in the area and for their continued work in rural unserved and underserved areas across the state.

 

Race looks forward to the second half of 2018 and continued progress. Race is on a mission to provide affordable high-speed broadband to the communities where larger carriers have ignored the needs of the residents. Race will continue to support net-neutrality, promote broadband access and adoption, and will continue to seek out new projects in unserved and underserved regions in California.

Finally, a big THANK YOU to those who have chosen Race as their new service provider as we could not have done this without you. Our customers are part of the Race family, and we look forward to providing our customers with the newest technology and the friendly customer service they have come to know.  Stay tuned for more exciting news from Race as the year progresses!

 

Race Gigathon Rolled Out in Phelan

Residents of the Phelan, Piñon Hills and Oak Hills areas of San Bernardino County were in attendance for the 2nd “Gigafy Phelan” Town Hall as Race Communications rolled out it’s Race Gigathon, where residents can win prizes including 1 year of FREE internet service from Race.

Project Update:

Race has purchased property in the Phelan area as part of their project to service over 10,000 households with fiber to the home.  Currently, engineers are testing utility poles and performing land surveys to assist with the final designs of Race’s Fiber network.  Race announced that the project in Phelan will be divided into zones which will be announced at a later time.

Race Gigathon:

The announcement of the Race Gigathon was received with much fanfare. Those in attendance participated in the #RELAY portion of the Gigathon by asking questions to Race Team members.  Race raffled off 1 FREE month of Race Internet while one lucky winner will win 1 year of FREE internet at the finish of the Gigathon.   Instructions on how to play and enter into the Gigathon are available at https://www.race.com/gigathon.

Gigafy Phelan Town Hall:

Race will hold their next town hall on January 20th with the time and location still to be determined.  Make sure you are receiving our project updates by filling out our Inquiry Form.  Share with your neighbors and friends so they can receive updates as well.

Check out our Race Communications YouTube Channel

Race YouTube Channel

 

 

 

Race Is Growing! Job Fair Coming to Tehachapi 😃

Race Communications has been working tirelessly to provide fiber-to-the-home internet service to the outlying areas of Tehachapi, CA for the past two years, and is now live in the communities of Stallion Springs, Oak Knolls, Cummings Valley and Bear Valley Springs. Race continues to add new customers and is expanding into the Central Valley and parts of Southern California. In July 2017, Race Communications was awarded their newest grant, bringing another 7,600 homes in the Phelan, CA (San Bernardino County) area into the future of fiber-based internet.  The company’s tremendous success in Tehachapi and the future expansion in Central and Southern California has provided the need to expand Race’s workforce.

As such, Race Communications is looking to open an office in Tehachapi in early 2018. The company is currently in the preliminary stages of exploration for this venture and feels very optimistic.

“Without the people of Tehachapi and the residents of the community that choose Race over other providers for their internet, phone and TV needs, this expansion would not be possible,” says Raul Alcaraz, CEO of Race Communications. “This venture relies on several factors, but we are hoping to find the right space and the right people for our expansion in the very community that has allowed us to be successful.”

Race Communications will host their first of several Job Fairs on Saturday, November 18th from 12pm – 4pm at the Stallion Springs Community Services District – 27800 Stallion Springs Drive, Stallion Springs CA 93561.  There will also be a second Job Fair in December. Race Communications would like to thank the residents of Tehachapi for their support and for making the company’s success possible.  Stay tuned for more information on the upcoming career days by following Race on Facebook or LinkedIn.

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➡ Race_Job Fair