TDS Telecom is ramping up its fiber expansion efforts. During its fourth quarter 2020 earnings call with investors, TDS executives said that in 2020 the company spent about $130 million to deploy fiber in existing and new markets.
Specifically, TDS deployed fiber to more than 67,000 service addresses bringing its total fiber footprint to 307,000 addressable addresses or about 36% of its wireline footprint. TDS also expanded its total wireline service area by 7% in 2020 because it launched services in new markets. That expansion brought TDS’ total number of service addresses to 845,000 at year-end.
However, in 2021 the company wants to be even more aggressive with its fiber and will spend $220 million on expanding its fiber to more addresses. According to Vicki Villacrez, senior vice president and CFO of TDS Telecom, by 2024 the company plans to have 625,000 total fiber services addresses, which will be more than 50% of its total coverage area.
Like many wireline companies, TDS experienced growth in broadband sales in 2020, much of which it attributed to the pandemic. The company saw its residential broadband customer base grow by 9% year over year. In addition, TDS subscribers are gravitating to the faster broadband services. The company reported that as of year-end 2020, 13% of its wireline customers were now purchasing fiber plans. The company also said that 40% of customers that are out of its territory are purchasing plans that offer 100 Mbps or greater service.
Residential revenue per connection also increased 5% year-over-year. TDS reported an average residential revenue per connection in fourth quarter 2020 of $51.33 compared to $49.11 in fourth quarter 2019.
On the cable front, TDS said that it will continue to expand its TDS TV+ IPTV offering into new markets. It currently offers TDS TV+ in 55 markets, which is up from 40 markets at the end of 2019. The company said that 40% of its broadband customers also purchase its IPTV offering. Last January TDS completed its $80 million acquisition of Continuum, a North Carolina-based cable company. During the earnings call, TDS said that it is currently updating Continuum’s cable plant to DOCSIS 3.1. It also said it would continue to consider other cable acquisitions.
By the numbers
TDS Telecom reported operating revenue of $976 million in 2020 with wireline operating revenues of $685 million and cable operating revenues of $292 million. In 2021 the company estimates that its total operating revenue will grow to between $975 million and $1.03 billion.
The company’s capital expenditures in 2020 were $368 million. TDS plans to increase that to $425 million to $475 million in 2021.