Bob Currey, CEO of Consolidated Communications (Nasdaq: CNSL), said that when Google Fiber (Nasdaq: GOOG) begins to enter the parts of Kansas City where it operates they will be ready to compete.
Currey (Image source: Consolidated)
As of now, the Internet giant's much-talked about fiber to the premises (FTTP) network has not begun to overlap Consolidated areas yet, as Google Fiber is still in the process of plotting out where it is going to bring its service next.
"There's not a lot to see yet, and the rumor is they are 40 percent built in the parts of the city--not in our territory, but the parts they announced three years ago with a few hundred customers--so it's really hard to tell exactly what they are going to pass us," he said during the J.P. Morgan Global Technology, Media and Telecom Conference on Wednesday. "Our estimates are that in a couple of years they will overlap with us with 3,000 to 5,000 homes."
Echoing similar sentiments from AT&T (NYSE: T) and other cable competitors like Time Warner Cable (NYSE: TWC), Currey said that Google has been given somewhat of an unfair advantage in getting approvals for rights of way, for example.
"Everybody was bidding for Google three years ago when they announced this project and cities went out of their way to fall all over them," Currey said. "The supplier of last resort and all of the commissions I fought to get the right to give telephone service, broadband, and video and these guys roll over for them with rights of way and laterals into public buildings that none of us could get."
Regardless of whether or not Google Fiber ends up in the territory where it operates, Consolidated, which entered the Kansas City market via its acquisition of SureWest, has plenty of weapons it can use to battle Google.
Consolidated has been competing with the likes of AT&T, Comcast (Nasdaq: CMCSA), and Time Warner Cable for the past five years. As it has done with these competitors, it will adjust its offerings to compete with Google when the search engine giant arrives in its market by leveraging its fiber and HFC assets.
"What's really good about Kansas City--at least where we're operating--is we're all fiber to the home and hybrid fiber coax so we have bandwidth that far exceeds any current or future customer needs at this particular time," Currey said. "With very little capex, we could take 50 Mbps to the home to 100 Mbps, and I don't see very many people that need 50 Mbps so I think we're in pretty good shape."
Besides using its HFC and FTTH assets to compete on the residential side, Currey sees equally compelling business and wholesale services opportunities in Kansas City.
As of the end of Q1 2013, Consolidated had a total of 195,962 fiber and 94,433 HFC-based homes, while copper homes remained flat at 399,547.
"SureWest--or Everest, the predecessor to SureWest--built fiber in the southwest part of Kansas City to mostly serve residential, and there's some great opportunities to tap the commercial market," Currey said. "There's actually an opportunity when Google really gets up and running that maybe you can provide some transport services to them where they won't have to build to certain areas where you're already at."
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