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Businesses Communications Network The Almighty Buck The Internet Technology

Frontier, an ISP In 29 States, Plans To File For Bankruptcy (arstechnica.com) 62

Posted by BeauHD from the what-to-expect dept.
An anonymous reader quotes a report from Ars Technica: Frontier Communications is planning to file for bankruptcy within two months, Bloomberg reported last week. The telco "is asking creditors to help craft a turnaround deal that includes filing for bankruptcy by the middle of March, according to people with knowledge of the matter," Bloomberg wrote. Frontier CEO Bernie Han and other company executives "met with creditors and advisers Thursday and told them the company wants to negotiate a pre-packaged agreement before $356 million of debt payments come due March 15," the report said. The move would likely involve Chapter 11 bankruptcy to let Frontier "keep operating without interruption of telephone and broadband service to its customers." Frontier reported having $16.3 billion in long-term debt as of September 30, 2019.

Frontier offers residential and business services in 29 states over its fiber and copper networks. Frontier offers broadband, TV, and phone services and reported revenue of $2 billion and a net loss of $345 million in the most recent quarter. Frontier has been losing customers and reducing its staff. Its residential-customer base dropped from 4.15 million to 3.81 million in the 12-month period ending September 30, 2019, including a loss of 90,000 customers in the most recent quarter. Also in that 12-month period, Frontier's business-customer base declined from 422,000 to 381,000. Meanwhile, Frontier had 19,132 employees as of September 30, 2019, down from 21,375 one year earlier. Frontier's financial performance last year was so bad that it refused to take any questions from investors during its quarterly earnings call in August. Frontier is in the process of selling its operations in Washington, Oregon, Idaho, and Montana to WaveDivision Capital.
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Frontier, an ISP In 29 States, Plans To File For Bankruptcy More

Frontier, an ISP In 29 States, Plans To File For Bankruptcy

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  • Perhaps its karma? (Score:4, Interesting)

    by raydobbs ( 99133 ) on Monday January 20, 2020 @06:20PM (#59639204) Homepage Journal

    When I was using them a long time ago in a galaxy far far away - they were the WORST on rolling out services. They just wouldn't (not couldn't, just chose not to) compete with Charter Communications on internet connectivity. Where you could get decent connectivity through Charter (if you didn't mind their tech support being utterly worthless), Frontier was still offering ISDN at hundreds of dollars a month for a metered connection, and their phone service was run like they were Ma Bell in the 1950s. Perhaps this is karma catching up with them?

    • Your experiences match mine. Phone service breaks, call them from work, two weeks later it's still not fixed, call them back, and "if you sign up for ISDN we'll move you up in the queue." So I got a traqfone. Fuckwits.

      Oh, the traqfone is $7/month, Frontier was over $30. Should have dumped them sooner.

      • Ditto. Frontier was the worst. Terrible support, rental fees for equipment I didn't even have and regular cease and desist notices for using normal amounts of bandwidth (100GB/mo). I am glad they are failing, they deserve it.

    • I think thats what their business model was. take lots of debt and use big yearly budget then as a reasoning for why the board can afford(nay, for why the board _needs_) to pay itself and the ceo millions.

  • Screw customers & creditors, get golden parach (Score:2, Insightful)

    by Anonymous Coward

    it's the current corporate business model, gut the ship for salvage, and then sink her ... no end to greed

  • I have been really happy with their fiber. I will say installation and getting techs onsite is a far cry from good. It was not until I watched my installer pull guys from other jobs to get me up in a few hours. Well no one you have issues with scheduling. It is the Wild West in the field.

    • I've been happy with their service too. Which doesn't take anything away from those who have had unsatisfactory experiences. It's also likely regional differences - these companies buy and sell chunks of business from each other. Frontier didn't pull the fiber or install the CPE anyway.

      When I moved to Dallas, I asked around about which company was best and was told that around here, Frontier is definitely the way to go.

  • Bad customer service should kill off these ISPs (Score:4, Interesting)

    by guruevi ( 827432 ) on Monday January 20, 2020 @06:22PM (#59639214)

    Spectrum/Comcast and Frontier are horrible services to deal with. Frontier still only sells 8Mbps DSL around here and they are the only competitor to 100Mbps Comcast, they've rested on the laurels knowing there is no other competition for low cost Internet since they had a monopoly on Internet services over phone lines through agreements with the city for the last 30+ years.

  • Frontier is in the process of selling its operations in Washington, Oregon, Idaho, and Montana ...

    Frontier should have stayed away from The Frontier.

  • All Frontier has is copper systems abandoned by Verizon... they were a spin off of the communities that didn't get upgraded to FIOS making Verizon's promise to give FIOS everywhere it controlled complete.

    Basically, this is where communications companies were never respected... either they're being competed with by cable so they're redundant and inferior, or they were running lines is too expensive yet there's still copper plant so those people are off to satellite.

    Basically, this was a scam to leave on the

    • Re:Expected (Score:4, Interesting)

      by aitikin ( 909209 ) on Monday January 20, 2020 @06:40PM (#59639260)

      In my neck of the woods, Frontier has Verizon's old FiOS and has been consistently upgrading it. It's been almost perfect, 2 outages in the nearly seven years I've had them, and one of them was equipment failure at my home (their equipment, installed by the previous home owner presumably years earlier). When I got it, I was at the second tier from the top with 45 Mb/s, now I pay less and have the lowest tier, still at 45 Mb/s and their mid tier is 100.

      Their customer service is atrocious though. The one outage that was their hardware failure in my house I spent 45 minutes on hold and when I got the guy, he acted like he knew a ton about all sorts of different routers and he'd never heard of the Netgear that I was running at the time...

      • Boy, that wasn’t my experience; after taking over from Verizon in SoCal, it was a year of pain before I ended up just dumping them and going Spectrum. I can’t imagine why anyone would want to use them unless it was the only option.

        I’ve been watching their fall for a while though. No surprises here. CenturyLink is the next question mark, but they seem to be stabilizing.

        • Here in North Texas they took Verizon's FIOS customers and they sucked at customer service at first and for a long time. However, they eventually got things smoothed out a bit and got on par with their chief competitor Spectrum. When I dropped them (for a time) they actually forgot about the equipment I had, never charged for it or asked for it's return (even though I called and tried to find out how). Spectrum was worse, if you can imagine that, and the transition back wasn't too bad.

          I don't think they t

          • North Dallas customer of Verizon FIOS until it was transitioned to Frontier, basically a happy customer throughout. Had a couple week issue with sporadic packet drops that eventually got resolved that was frustrating. Customer service is poor but not awful IMO, but I am really scratching my head over how they can be losing money. I pay $150 a month for nothing, basic TV package with HD channels (no sports) and 50M fiber internet. I was paying less but made the mistake of re-negotiating and found myself trap

        • Re: (Score:2)

          by Malenx ( 1453851 )

          After taking over Verizon at my parents house, the previously consistent dsl internet just devolved into being lucky they could get 5mbps down.

          After 6 different service technician visits by 3 different people, my parents just gave up and settled with what they had.

          I'm not surprised people are running from them now that cell phone internet is so much cheaper.

      • Our experience with Frontier has also been good. FIOS for 13 years, one service call in last 5 years. After reporting they could find nothing wrong on their end, Tech was at the house the next day and replaced a legacy piece of Verizon equipment with new at no charge.

        The monthly bill ($53) is the lowest I've seen ever, this for high speed residential. Nearly perfect uptime and reasonable response time on the one service call.

        But if their business model is not sustainable, I guess I'm going to be shopping

    • Re:Expected (Score:4, Informative)

      by bhcompy ( 1877290 ) on Monday January 20, 2020 @06:55PM (#59639320)
      This is not true. They also acquired the Verizon FIOS fiber in territories they picked up(like in Southern California). Ultimately, both Frontier and AT&T (U-Verse, garbage) have come to separate decisions to only roll out fiber to the premises in new developments, and Google has mostly abandoned FTTP, too, focusing on multi-unit developments like apartments and condos

      • Re: (Score:3, Interesting)

        by The New Guy 2.0 ( 3497907 )

        FTTP is failing, Comcast implemented Fiber-To-The-Curb and got cheaper equipment and better results. When FIOS burns out, it'll be replaced most likely with FTTC.

        And Southern CA... you're another market failure. So dependent on other markets, the "only four routes" problem applies to water, power, and data. Hollywood has mostly left, the news anchors never come over to visit, and your sign to the nation that you were okay in the form of news on your SuperStations has gone away years ago. That's the reason V

        • Seek help
        • One of these days The Big One is going to hit and everything east of the San Andreas Fault will fall into the Atlantic Ocean.

          California, the land of fruits and nuts.

          The real problem is that the USA is slightly tipped and everything loose has rolled to California.

          It's not that I'm bigoted about California. I've driven though it a couple of times. And I can honestly say, it is a good place to be from. A long way from, that is good.

    • Comment removed based on user account deletion

    • I get 500/500 Fios for $80 a month. No complaints from me. I will be really disappointed if the fiber shuts down.

  • 2% (Score:5, Informative)

    by Sarten-X ( 1102295 ) on Monday January 20, 2020 @06:33PM (#59639242) Homepage

    For what it's worth, Mr. Han is a newcomer to the CEO role at Frontier. The previous CEO, Daniel J. McCarthy, apparently jumped ship in December.

    In 2018, McCarthy made $7.1 million on paper, including almost $2.5 million in salary and bonuses [salary.com].

    2% of the company's debt sure isn't much, but it sure doesn't look too good for a company to be sinking in debt while paying out bonuses of 146% someone's salary.

    • Re: (Score:1)

      by Anonymous Coward

      This is not a defense, merely an observation:

      Sometimes paying out a large bonus to get a "key" person out the door is the least costly way to do the right thing for a corporation.

  • Seriously... I am not the least bit shocked here. These guys are the worst ISP on the planet. They don't care one bit about the customer or the service they provide.

    They price their services higher than the competition and focus heavily on upcharges and services fees, such as a router rental that you have to pay even if you don't have their router. My laggy, packet dropping Fiber connection for 150mb costs $150 a month with AT&T Gig a block away for $59.

    I never thought anyone could be worse than AT

    • I've had the opposite experience. Have been using FIOS for well over a decade now (it was Verizon when I signed up). Had 2 outages and a handful of maintenance window downtimes, so less than once a year on average. They don't raise prices every month with invented fees like Comcast, the price I agree to stays the same until I call to change plans (I check every year to make sure I'm on the best available plans, changed 3 times since I got it, 2 of the 3 was to up the speed at same price with contract commit

    • This has to be regional. I mentioned in another post I get 500/500 Fios + phone for $80/month and 1GB is available if they upgrade my ONT. Yes, I do get those speeds. I don't pay extra for the router and I don't see any weird charges for anything. I've had Fios here since Verizon had it and been with Frontier since, so about 10 years no with no real issues. Now, AT&T is the benchmark for craptastic, my mother in law has it and she pays as much for 50/50 and it constantly has problems.

    • Seriously... I am not the least bit shocked here. These guys are the worst ISP on the planet. They don't care one bit about the customer or the service they provide.

      I firmly disagree... While Frontier is not ideal, they are NOT the worst ISP on the planet. I have two choices, Frontier and Spectrum Cable and Spectrum is so bad that they make Frontier look good. This means Spectrum Cable is worse...

      But let's face it. Being an ISP is not the money making business it used to be and any cable provider is being squeezed between content providers fees and the dying cable TV market and government regulators. Nobody in this space makes money..

  • Fitting (Score:3)

    by tgetzoya ( 827201 ) on Monday January 20, 2020 @07:01PM (#59639338)
    I moved to Oregon in 2015 and didn’t want Comcast. Frontier told me it would take three weeks to install service. Three weeks later: they refused to install. Comcast set up service the very next day.

  • This is what happens when you change your name from Rochester Telephone to Frontier.

    • This company is not the original Rochester Telephone, per: It was known as Citizens Utilities Company until May 2000 and Citizens Communications Company until July 31, 2008. The company previously served primarily rural areas and smaller communities, but now also serves several large metropolitan markets. AND Citizens Communications acquired the Frontier name and local exchange properties from Bermuda-based Global Crossing in 2001. Global Crossing acquired the local exchange properties in 1999 when it pu

  • I hadn't heard of their dismal financial performance, but I had heard lots about Frontier's dismal performance of telephone and internet service from my mother and my sisters who have endured their dismal incompetence for years. My sisters have ditched their land lines and gone pure cell. I think they're also using their cell phones to provide wifi hot spots at home for Internet.

    My mother still uses Frontier's land line, but not happily.

    With any luck, their assets will be acquired by someone who has some

    • I'm afraid that lady luck will NOT be smiling on your loved ones. The Cable - Telephone - ISP business model is dying. You have HUGE infrastructure costs and debt, government regulated fee structures, stiff competition from "online providers" and a culture of "cord cutters" which is steadily robbing you of customers. All these companies are doing is managing the decline, regardless of who they are.

      Frontier is not going to get better, nor are their competitors. It's a race to the bottom.

  • This bankruptcy is strategic, not service related (Score:5, Informative)

    by doubledown00 ( 2767069 ) on Tuesday January 21, 2020 @12:42AM (#59639952)

    This has nothing to do with their ISP services or anything having to do with their business offerings. This bankruptcy is for multiple business purposes:
    1) Allows them to refinance the debt that was necessary to buy Verizon;
    2) Allows them to renegotiate contracts with distributors, office space and store front leases, etc;
    3) Allows them to seek concessions from their recently acquired FIOS employees that are covered by a union.

    Bankruptcy is a modern business tool. Like currency arbitrage, and contract efficient breaches. Management probably knew ever before the Verizon deal closed that they were going to do it. If I can acquire a business with debt at 10 percent interest and then get that rate down to 6 - 7 percent via strategic bankruptcy, why wouldn't I?

    I would be very surprised if this impacted Frontier's day to day operations in even the slightest.

    • Comment removed based on user account deletion

      • Frontier isn't a private company owned by a hedge fund or a crooked real estate mogul, it's a publicly traded company whose directors will get sued to oblivion by angry shareholders if they've engaged in the fraud you're describing. I appreciate you want to give the cynical view, we're all pretty cynical of the practices of big money and big business right now, but this kind of fraud doesn't fly because it's illegal, and it's illegal because it completely goes against the interests of the elites.

        Um if you think it's illegal you're sadly mistaken. Goes on all the time.
        These "shareholders" you're describing? They're holding stock worth 58 cents. This company is a corpse.

        It's all part of the plan, it's just that you're not in on it.

    • This has nothing to do with their ISP services or anything having to do with their business offerings. This bankruptcy is for multiple business purposes:
      1) Allows them to refinance the debt that was necessary to buy Verizon;
      2) Allows them to renegotiate contracts with distributors, office space and store front leases, etc;
      3) Allows them to seek concessions from their recently acquired FIOS employees that are covered by a union.

      Bankruptcy is a modern business tool. Like currency arbitrage, and contract efficient breaches. Management probably knew ever before the Verizon deal closed that they were going to do it. If I can acquire a business with debt at 10 percent interest and then get that rate down to 6 - 7 percent via strategic bankruptcy, why wouldn't I?

      I would be very surprised if this impacted Frontier's day to day operations in even the slightest.

      You're speaking authoritatively here about something you obviously don't know much about. This is a publicly traded company with shareholders and board of directors. If they did what you say the board would go to jail, and the shareholders would form a line a mile long to sue them into oblivion for lost returns.

      No offense intended, but what you describe isn't factual.

      • Re: (Score:2)

        by leonbev ( 111395 )

        Well, I doubt that the shareholders will be a problem anymore. Their stock has been trading at less than a dollar a share for awhile now, and usually stockholders are usually the last people to recover any of their capital in a bankruptcy.

      • You're speaking authoritatively here about something you obviously don't know much about. This is a publicly traded company with shareholders and board of directors. If they did what you say the board would go to jail, and the shareholders would form a line a mile long to sue them into oblivion for lost returns.

        No offense intended, but what you describe isn't factual.

        What shareholders exactly is that? The stock is at 58 cents. The company is talking to creditors about re-negotiating the debt which is bankruptcy talk for trading debt for shares in the new entity.

        The die is cast. Everything I have said is playing out right in front of you. This is a strategic bankruptcy in action.

  • Company is horrible. Iâ(TM)m just glad all my clients have moved to a local fiber provider. 10x the speed at half the price and actual customer service.

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