FairPoint, Maine PUC reach agreement on state's broadband plans

FairPoint Communications' (Nasdaq: FRP) new three-pronged broadband expansion plan for Maine has gotten the thumbs up from the state's Public Advocate and the Public Utilities Commission (PUC).

The new plan will focus on extending broadband to more residential and business customers.

By next April, the telco has agreed to expand broadband service to 87 percent of its residential telephone customers, while investing an undisclosed amount on both residential and business customers. It will also spend an undisclosed amount of its own funds and federal funds to provide broadband to residents who live in unserved and underserved areas of the state.

"We think what we've negotiated will provide service to places that don't have any broadband service right now, or places where FairPoint is the only broadband service, and it's not as fast as it needs to be," Tim Schneider, Maine's Public Advocate told the Maine Public Broadcasting Network. 

Last July, the telco got a $2 million grant from the Federal Communications Commission's Connect America Fund (CAF), which helped it fund broadband expansions in South China, Maine, for example.

In Maine, FairPoint said it has spent over $200 million to upgrade the state's broadband infrastructure and plans to upgrade 30 new locations to increase the speeds it can deliver to customers.

However, the challenge that FairPoint faces is building a business case to extend broadband services into more rural areas where there's lower density of customers.

"We've expanded broadband to the point where those who do not have it now--it's very costly," said Jeff Nevins, a spokesman for FairPoint. "So, we're at that point where, in terms of trying to develop a business case to expand beyond the current footprint, is very difficult just because, purely, the cost."

Broadband has helped FairPoint stem some of the bleeding from declining voice service revenues.

The telco's second quarter data and Internet service revenues grew 11 percent year-over-year and 5 percent sequentially in Q2 2013 to $40 million.

For more:
- MPBN has this story

Special report: Frontier, FairPoint, others find new wholesale life with wireless backhaul

Related articles:
FairPoint's data, Internet services revenue grow 11 percent to $40 million
FairPoint expands DSL coverage in parts of Maine, Vermont
FairPoint to build next-generation 911 system for state of Maine
FairPoint Q1 data, Internet services revenue grow to $38.1 million

Suggested Articles

Nokia and VMware have expanded their partnership to include a lab to certify Nokia's VNFs on VMware's vCloud NFV platform.

Ribbon Communications announced on Thursday that it's merging with ECI Telecom Group, and that CEO Franklin (Fritz) W. Hobbs has departed the company.

Cisco CEO Chuck Robbins expects macro economic conditions, such as the trade war with China and unrest in Hong Kong, to curb the company's revenues.