The future is fiber for TDS, Shentel

Two independent telecom service providers–TDS Telecom and Shentel–touted their increasingly fiber-focused broadband expansion plans at this week’s New Street Research and BCG Global Infrastructure Conference.

Jim Butman, president and CEO of TDS Telecom, told investors that TDS is pressing ahead with a self-funded fiber expansion that mostly will focus on out-of-territory growth, with a few exceptions where the provider uses a full fiber deployment to defend some of its ILEC areas from competitive overbuilders.

“We’ve got about 400,000 fiber-connected homes and businesses and about 500,000 still DSL, 500,000 cable HFC. That’s today about 1.4 million broadband addresses,” Butman said. “We have plans over the next five years to make the business much more fiber-centric. We’re going to grow to 2.2 million broadband addresses, and fiber is where the vast majority of our investment is going. We’re going to grow to 1.3 million fiber addresses, and most of that is out of territory.”

And that is TDS’ plan without the assumption of additional federal or state infrastructure funding, Butman said. Getting more money through those channels could allow TDS to do more.

TDS is pursuing limited opportunities to deploy full fiber in its ILEC markets, but only where it is seeing competition. “There were a couple very small areas where fiber overbuilders were coming in, and we just made a decision that we're gonna go all the way [with fiber],” Butman said. “We're aggressive in protecting our markets and making sure that we meet competition, and we do it economically. If it wouldn't make sense to do it… that wouldn't be the case.”

Meanwhile, Edward McKay, EVP and COO at Shentel, said his company also is full focused on a full fiber-to-the-home expansion via its Glo Fiber offering, but unlike TDS, Shentel’s plans have been spurred by the increased access to government broadband funding that many other rural service providers also have seen.

“At the end of 2021, we had roughly 300,000 broadband passings, and about 200,000 of those were in our incumbent cable markets, 75,000 were in our Glo Fiber greenfield overbuilder markets, and then about 30,000 more were in our Beam fixed wireless broadband markets,” McKay said. “We do expect our cable passings to increase modestly over the next five years, but our primary growth will come from our Glo Fiber markets. So we're on track to more than double our broadband households the next five years. We plan to grow to over 450,000 by the end of 2024. We plan to grow… to over 700,000 in the next five years. And that's driven almost entirely by fiber.”

Even as competitors might be using fixed wireless broadband to some degree to battle Shentel’s expansion, McKay said his company’s Beam wireless broadband service is “not likely” to grow past the 30,000 passings it has today because government funding for fiber programs makes fiber expansion much more achievable.

“Once we saw the [federal and state] government funding that was coming into our markets, we believe with the funding that's out there today will justify building fiber to the vast majority of the homes we previously targeted for being fixed wireless,” he said.