Verizon's Strategic Move: Acquiring Frontier to Boost Fiber Connectivity

Verizon's Strategic Acquisition

According to reports from The Wall Street Journal and Bloomberg, Verizon is in advanced talks to acquire Frontier Communications, a move that could significantly enhance its fiber network capabilities. This acquisition might allow Verizon to reclaim some of its former Fios subscribers lost after Frontier purchased Verizon's wireline operations in 2015 for $10.5 billion.

Competing in the Fiber Space

With AT&T deepening its fiber investments and T-Mobile planning to acquire Metronet, Verizon's interest in Frontier signals a shift in strategy focusing on ownership of its fiber services. During a recent Bank of America Securities conference, Verizon's consumer group CEO, Sowmyanarayan Sampath, emphasized that the company prefers to own its fiber business to mitigate complexities that arise from partnerships.

Building a Sustainable Fiber Network

• Sampath highlighted the importance of ownership in building a sustainable ecosystem for both mobile and home connectivity.
• He mentioned that bundling services reduces customer churn significantly, with fiber users experiencing a 40% decrease in churn rates.

Frontier's Comeback

Having filed for Chapter 11 bankruptcy in 2020, Frontier has reemerged and is actively expanding its fiber services across 25 states, now offering speeds up to 7Gbps.