Consolidated Communications executives consider 2021 a “transformative year” for the company thanks to its partnership with Searchlight Capital Partners and its infusion of capital into the company. The two-stage Searchlight deal consisted of an initial investment of $350 million in exchange for 8% of the company’s stock and a second investment in the amount of $75 million for an additional 10.1% of its stock. The first phase was completed in October 2020 and the second phase required the approval of the Federal Communications Commission (FCC), which said earlier this week that it will approve the deal with a few conditions.
Speaking at the Wells Fargo TMT virtual investor conference this week, Bob Udell, president and CEO of Consolidated Communications praised the Searchlight partnership because it enabled Consolidated to recapitalize the company and fully funded its fiber deployment. Those fiber expansion plans call for Consolidated to grow is fiber footprint to 1.6 million locations within the next four years, with 1 million of those locations situated in New England.
Udell said that the company is on track to deploy fiber to 300,000 locations this year, and it is targeting 400,000 locations in 2022 and 2023.
The company is already working on its 2022 deployment plans, and he said that it is seeing some supply chain issues, primarily with chipsets. But to circumvent any problems, Consolidated is purchasing inventory as quickly as it can to support future fiber deployments. “Like everyone else, we are watching the supply chain closely and seeing pressure but nothing that will disrupt our plans,” Udell said.
One reason that Consolidated is able to move more aggressively than others with its fiber plans is that much of its deployment in New England involves aerial fiber, which is easier to deploy because it doesn’t require digging trenches.
Udell also said that in terms of penetration rates in its fiber markets, where it faces competition primarily from cable providers Comcast and Charter Communications, Consolidated is targeting a 14% penetration rate within the first year of fiber being deployed and a 24% penetration rate during the second year. By the fourth year of deployment, it believes it can get a 40% penetration.
RELATED: Consolidated spotlights Wi-Fi experience with Fidium Fiber rollout
Although it’s only been a few weeks since Consolidated launched its new “Fidium Fiber” brand for consumer in its New England footprint, Udell said that early response to it has been better than expected and that the company’s orders via the Web have increased significantly. Fidium Fiber offers symmetrical 50 Mbps, 250 Mbps and 1-gig service tiers. The latter runs $70 per month, with Wi-Fi equipment and installation costs included and no contract required.
“People looking for broadband are looking on the web first,” Udell said, adding that the company plans to expand its Fidium Fiber branding beyond the initial footprint.