Frontier Communications (Nasdaq: FTR) may be aggressively expanding DSL services in both its existing service areas and over the phone lines it purchased from Verizon (NYSE: VZ) last year, but it has decided to add satellite services to its broadband service arsenal via a wholesale agreement with Hughes Network Systems.
Image source: EchoStar
Under the terms of the agreement, the rural telco will distribute satellite-based broadband services to markets it says have been previously unserved or underserved by broadband providers.
Set on giving eligible customers a common look and feel, the satellite service will be overseen by Frontier itself with local installation, customer service and support teams.
To deliver the satellite service, Frontier will use the recently launched EchoStar XVII Satellite with JUPITER High-Throughput Technology, which supports HughesNet Gen4 satellite Internet services that will debut this fall. Hughes is a wholly-owned subsidiary of EchoStar Corp. (Nasdaq: SATS).
Given the latency known issues with satellite broadband, critics will likely pan the satellite effort. Nonetheless, the service provider's move with Hughes is a realization that it can't realistically upgrade its network infrastructure to reach every customer via traditional wireline broadband methods.
And while it is adding satellite service to its bag of broadband tricks, Frontier continues to expand its traditional DSL-based wireline offerings. The service provider was one of the first service providers to secure a $72 million Connect America Fund (CAF) from the FCC to expand its broadband reach in a number of its territories.
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