FairPoint has begun an over the top (OTT) video trial in its Ellensburg, Washington, market, kicking off an effort to enhance its relationship with its broadband subscriber base that’s migrating toward online service options.
Consumers have increasingly used a mix of Roku and Apple devices to get access to Amazon, Netflix and Hulu streaming services, while supplementing them with an over the air antenna to get local TV channels.
Paul Sunu, CEO of FairPoint, said during its third quarter earnings call that it wants to take away the guesswork for customers that want to cut the cable cord, particularly for its rural customers.
“In our rural markets, customers find it difficult to get over the air broadcast signals due to distance ... so we’re going to make it easier for them,” Sunu said. “Using a FairPoint-provided broadband connection, we’re offering crystal clear high definition signals from local network affiliates through a channel on a Roku device.”
In order to deliver the OTT video service in Ellensburg, FairPoint will have to purchase content from local broadcaster affiliates. Having built out cable networks in various parts of its footprint, FairPoint purchases content as part of a consortium with other service providers, a prospect that Sunu says can save the telco money as it scales the product.
FairPoint said there’s a number of technical and market factors that drove the telco to trial the service in Ellensburg. On the technology side, FairPoint has already built a head end in that market and it has a large fiber footprint there. As a college town, Ellensburg is ideal for demographics with a good sized population.
“We do have 10,000 cable subs across our footprint and we’re part of a consortium that can buy some programming on a more economical basis,” Sunu said. “We’re kind of leveraging that in terms of the fees that we would pay, plus we have the infrastructure up there and Ellensburg is pretty well wired up and is a good place to test it.”
While FairPoint did not provide many details about when it would launch the trial or how many customers it would serve, Sunu said that if the trial goes well it could bring it to other markets.
“Based on results, we expect that we could easily launch the product in our Northern New England market,” Sunu said.
Extending the OTT service to Northern New England makes sense for FairPoint as the service provider has been expanding the availability of its traditional DSL services, but also its 1 Gbps FTTH service in cities like Portsmouth, New Hampshire, where it launched in 2015.
At that time, FairPoint also began offering fiber-based services eligible for select residents and businesses in Greenland, New Castle, Newington, Rye and Stratham. These customers could be a potential target for the OTT video service.