Frontier (Nasdaq: FTR) has closed a major chapter in the rural lines it acquired from Verizon in July 2010 with all of the wireline systems in 14 states now converted over to its own legacy systems.
The service provider said that the conversion, which was done almost nine months ahead of schedule, "reduces cost and complexity, improves the customer experience and facilitates the rollout of new products and services."
When it originally completed the acquisition in July 2010, the telco nearly tripled its size, providing services to 4 million residential, including FiOS, and business customers in 27 states.
Converting the Verizon operations onto its systems was carried out in three stages. West Virginia operations came in tandem with the closing of the acquisition in July 2010. Later in October 2011, Frontier moved the acquired operations in Indiana, Michigan, North Carolina and South Carolina onto its operating systems and the acquired operations in 13 states moved onto Frontier's financial and human resources systems. Finally, in April 2012, the service provider completed the conversion of the acquired properties in the states of Arizona, California, Idaho, Illinois, Nevada, Ohio, Oregon, Washington and Wisconsin onto its legacy operating systems.
"With all operations now on one set of systems, our employees will better serve our customers," said Maggie Wilderotter, chairman and CEO, in a release. "Consistent processes and procedures help get new products and services to customers faster, enhance customer retention and market share, and improve the overall customer experience."
Of course, getting to this stage saw it share of issues.
One of Frontier's biggest problems was related to how it handled the existing FiOS customer base. Claiming that it could not support the high cost of acquiring content, the service provider jacked up prices on FiOS installation in Indiana, Oregon and Washington.
In every quarter since making these moves to increase FiOS installation rates, it lost FiOS video customers. In Q4 2011, the service provider lost 5,900 FiOS video customers, but has tried to recover by offering satellite-based TV through a partnership with DISH.
Early on in the acquisition process, Frontier faced protests from CWA union workers in West Virginia, the telco's largest state, who questioned whether Frontier had the financial wherewithal to take over and operate Verizon's rural lines.
Despite their challenges, with this conversion now firmly in place, the service provider is turning its attention to expanding its consumer broadband capabilities and building out its backbone network to support metro Ethernet, as well as improving its video caching capabilities per its recent agreement with BTI.
- see the release
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