So with this buying of frontier I would think it would bring more work less Riffs //
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This all fits into Brightspeed's plan. It is certain VZ is going to sell all of their territory they just needed to make it bigger to atract Brightspeed.
@qew+1umeiHGQ My guess is that Frontier will do some right sizing in the next 18 months and the rest will go with the sale. After the sale, "synergies" will result in more downsizing.
I thought the company was on hard times and needed the VSP then they turn around and spend $20B..... wow.
Hans did not look happy about the deal, looks like someone twisted his arm. Stratton is laughing all the way to the bank. He may not be CEO of VZ but he sure is collecting. He proved his strategy works and look at what he did for Frontier. But he also was the cause of the huge RIF in 2011 of 20%.
Stratton for CEO! Bring back the suits! Because Verizon knows nothing about reinventing the wheel. If you’re around long enough, all those “new” ideas were actually tried and failed years ago. Convergence means people will lose their jobs and I wouldn’t be quick to assume Frontier is on the losing end. RIFs are part of Verizon’s culture.
"For Verizon, this would be a bold step in the direction of convergence … which is, in our view, an absolutely atrocious idea," MoffettNathanson analyst Craig Moffett said in a report. "Verizon's current fiber footprint covers but a small fraction of the U.S. And, Frontier wouldn't materially change that."
Moffett added: "There is simply no path forward for Verizon to cobble together a meaningful wireline coverage map, and a national wireless network basing its strategy on convergence with wireline fiber that is available to just a small fraction of American homes, with no conceivable path to broad coverage, is an awful strategy."
Its the opposite, as they consolidate teams. People will be cut.
It's a win for VZ employees to stay there for a couple more years. Most Frontier Employees will be Riffed after customer transfer with a good VZ Riffed package.
@uel+1umeiHGQ
Actually VZ sold assets across 16 States to Frontier for over $21Billion in 2 separate sales.
$8.6 bil + transferred $3.3 bil in debt for lines in 14 states (including parts of CA in 2009... and then sold the remaining 3 States (including the rest of CA) in 2015 for the other $10+ Bil. (not sure how much additional debt, they passed off in that deal) VZ gave Frontier 1.7mil Fios customers & is getting back 2.2mil fios customers. So basically the bought it back for less than they sold it for, gain 500k fios customers, and didn't have to pay any of the fios installation costs, or their employee salaries for the last 9-14yrs.
So from a pure number's standpoint it's not a bad deal...
However, they are going to end up with a ton of copper in rural area's they didn't want before, and likely don't want now. Unless they are playing an angle to get a bunch of Gov handouts to upgrade rural area's. Or maybe they just plan to sell off the copper, right after they get it. Just like they did when it came from GTE in the 1st place.
"Verizon, the third-biggest issuer in the US corporate investment-grade bond market outside the financial sector, said in a presentation on Thursday that it expects to refinance Frontier’s existing debt. Junk-rated Frontier has about $11 billion in debt. Verizon will likely need to issue debt to pay Frontier’s stock investors and to refinance Frontier debt, added BI’s [Bloomberg] Flynn."
Convergence is not a strategy.
Buy high, sell low. This is the Verlieson way. What a bunch of clowns. And where is this $20 billion coming from? Verlieson has about as much debt as the federal government!
@uel Frontier has a lot of other assets other than what we sold them in FL, TX and CA. A few years prior to that we sold them assets in 14 other states. And then there are the assets that VZ never owned that make up the rest of Frontier Connecticut, Rochester, NY etc.
So.. what’s next for frontier employees that were former Verizon employees ?
More riffs, more work.... not less of either.
So now VZ have money. Sell to Frontier for 10B and buy it back 5+ years later for 20B. Now let’s see how long they keep it and then put it as a loss, as VZ has been doing that for every purchases. 🙄
How are they paying for it?
I hope the huge premium that we paid includes us getting John Stratton.
Certainly. VZ wanted those assets (much of which was f/GTE) but didn’t want to take the CapEx hit with aging copper, non-contingent footprints, and employee expenses. So, you sever places like Durham and Fort Wayne for 15+ years, places like Tampa, DFW, and Southern California for 10+ years, and when the dust finally clears, you buy all it and then some back for pennies on the dollar. The convenient leadership at Frontier of Stratton? Convenient, indeed.
@wtf+1umeiHGQ, help me understand how "getting desperate" = spend $20 billion?
A lot of Frontier employees in the DFW and California markets are former VZ employees who were previously RIF'd by Verizon. This is actually comical that after selling these "strategic" territories to Frontier, who shortly thereafter filed Bankruptcy, VZ is now acquiring this dog of a company. Hans and the leadership are getting desperate to keep the Titanic afloat!
A lot of employees located in the Frontier footprint, especially in WV, were VZ/BellAtl employees prior to the sell off to Frontier.