Frontier CFO says more fiber subs are using over 2 TB of data per month

Data demand is rising at a blistering pace and Frontier Communications is putting some numbers to the usage it’s seeing from subscribers a little over a year into its fiber build.

Speaking at an investor conference on Tuesday, CFO Scott Beasley said the average fiber customer on its network now consumes almost a terabyte (TB) of data each month. That figure is up 30% from pre-pandemic levels. He added the top quartile of its customers are gobbling up even more, using “two-plus terabytes of data per month.”

His statements come after OpenVault released a report earlier this month showing a 31% increase in “super power users” who consume more than 2 TB of data per month. This growth outpaced an 18% year on year uptick in the number of so-called “power users” consuming 1 TB of data per month. Charter Communications CEO Tom Rutledge said on its Q1 2022 earnings call it is also seeing a rapid rise in data demand, with around a quarter of customers now using a terabyte of data or more per month.

According to Beasley, Frontier estimates the average household in its footprint has 22 connected devices and that will only continue to rise, driving data demand even higher. The operator is already capitalizing on that with its multi-gig service offer, which launched in February.

“We’ve been very pleasantly surprised by the uptake in our 2-gig service. Largely that’s power users who use a ton of bandwidth for gaming, for a lot of streaming devices, video conferencing, telemedicine,” he said. “Now, not everybody needs 2-gig today, but we think that’s rapidly changing.”

Though cable competitors and the likes of AT&T and Verizon have touted the benefits of bundling fixed and wireless service on broadband churn, Beasley reiterated Frontier doesn’t see a need to pursue a wireless offer just yet.

“Demand for fiber is clear. We’ve had three successive quarters of record net adds without a wireless product. Consumers are choosing the best connectivity products separately from the potential to bundle it with wireless,” he said. “Secondly, we haven’t done it yet because the returns on capital from building our fiber are so strong for us that we’ve chosen to stay focused.”

Beyond ramping deployments to meet its goal of reaching 10 million locations by the end of 2025, the CFO said Frontier is focused on enhancing its digital capabilities – both on the customer facing front and in the back office.

The former includes things like the implementation of more self-service tools, refinements to its app and enhancements to its online chat function. The latter, meanwhile, includes changes to make it easier for the company to process payments from the third of customers who still submit checks for their monthly bills and applying artificial intelligence to help with assigning and dispatching field technicians.

“Early innings there but some really positive improvements on our customer facing [platforms],” he said. Beasley added the same is true of its multi-year back office automation effort and there’s “a lot of good improvement to come in the next few quarters and years.”