Frontier may be jumping on the SD-WAN train, but unlike its larger ILEC counterparts AT&T and Verizon, the service provider is in a unique position: It does not have a large MPLS customer base to cannibalize.
Perley McBride, CFO of Frontier, told investors at the UBS 45th Annual Global Media and Communications Conference that offering SD-WAN won’t create revenue pressures on its broader business service base.
“SD-WAN is a small product for us,” McBride said. “We never really invested in MPLS, so SD-WAN will be all incremental to the commercial business unit.”
While the service provider has not made a formal SD-WAN debut yet, the service is going to be part of its next-generation service architecture for the upper part of its business customer base.
“It’s a product that will be best for enterprise or regional businesses that are running their own networks,” McBride said. “We believe it’s the right product to have.”
Offering SD-WAN will tie in with the service provider’s realignment of its commercial business. Frontier reorganized the company with a new commercial unit earlier this year that’s run by Ken Arndt.
In realigning the structure of its commercial unit last year, Frontier hopes it will be able to better respond to business customer needs in its legacy footprint and the CTF markets it entered via its Verizon wireline asset acquisition. Although Frontier is the incumbent in many of the markets it serves, including the CTF markets, the service provider says it has room to grow market share.
“We believe we have an opportunity because we’re the incumbent and we have low share,” McBride said. “The way the commercial unit thinks about it today is we should be the attacker brand.”
What makes McBride confident about Frontier’s ability to attack the business services market is the underlying network. Today, Frontier currently has fiber installed to over 30,000 buildings in its footprint, a factor that will enable it to more rapidly respond to customer requests for next-gen IP and Ethernet services.
In November, Frontier announced it had developed tools and systems that focus on two areas: selling services where it has built out its own network, and automating the approval process on pricing and capabilities. These tools are designed to streamline Ethernet activation and sales processes for business and wholesale customers.
“We can price, turn up and provision circuits and services far faster than anyone can because we have the underlying network in all of our markets,” McBride said. “The business network is fiber-centric.”