FairPoint, Frontier get into the energy game

FairPoint Communications (Nasdaq: FRP) and Frontier Communications (Nasdaq: FTR) in the past week launched their own separate initiatives to enter the energy services business, a move that signifies the need for wireline-centric telcos to diversify their service sets.

Although these are two different initiatives in different regions, both telcos are working with Crius Energy, a renewable energy provider with retail energy companies in 10 states and the District of Columbia, which they will offer to customers via their own respective brands—FairPoint Energy and FTR Energy Services.

Last Thursday, FairPoint Communications launched FairPoint Energy, targeting current Northern New England residents that purchase power by either Central Maine Power Company or Bangor Hydro Electric Company in Maine and in New Hampshire by Public Service Company of New Hampshire.

The service provider said customers, can select chose that offer savings, clean wind power, or a combination of both.

Tony Tomae, executive vice president and chief revenue officer for FairPoint Communications, said in a release announcing the service that "Enrollment is simple and seamless, allowing customers to sign up through the FairPoint call centers, easily selecting an alternative energy supplier while staying with their current utility company for distribution."

Frontier last Thursday also entered the game through a similar partnership with Crius to offer up a suite of both electricity and natural gas services.

Set to be available this November in select market, FTR Energy Services is a wholly-owned subsidiary of Crius Energy.

"FTR Energy Services builds on our strong relationship with our customers and our commitment to the communities we serve," Ann Burr, president, New Product Trials and Integration, Frontier Communications, in a release about the launch of FTR Energy Services. "They trust us to provide additional value, and we take that obligation to heart. As with other partnerships, we have selected industry leader, Crius Energy, to craft an offering that helps customers and enhances our business without additional cost or operational complexity."

FairPoint and Frontier, however, are hardly alone in offering energy services. Last year, Cincinnati Bell (NYSE: CBB) began offering energy services to its residential customer base through its new subsidiary Cincinnati Bell Energy. Like the two Northeast providers, Cincinnati Bell is offering its energy service through a partnership with Viridian Energy, a Connecticut-based renewable energy supplier.

While these three telcos' initiatives are certainly not the same, there's a common theme of targeting an embedded base of customers that could see value in having one utility bill for phone, Internet, voice, video and energy. Another key aspect is that this trio also taking care of all of the back office maneuvering it will take for customers that want to hand over their energy services to them.

For more:
- see the FairPoint release
- here's the Frontier release

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