Fiber-Focused Broadband Plan Drives SureWest Growth

With broadband sales surpassing legacy telecom sums for the first time in its history, SureWest Communications is convinced its fiber-focused wireline plan will fuel continued growth in residential and business bases.

The IPTV pioneer’s top execs drove this message home in a quarterly earnings call Thursday morning, detailing the overall broadband growth plan. For example, the Roseville, Calif.-based LEC has acquired an out-of-region telco and sold most of what it called “non-essential” wireless assets to Verizon Communications Inc.

SureWest also is in the middle of upgrading parts of its copper-to-the-home plant to fiber, over which it delivers 100mbps to each home. It further is investing in the fiber ring around Kansas City; SureWest got that ring when it bought Everest Broadband earlier this year.

“We’ve narrowed our focus to providing advanced networks services to our customers,” said Steve Oldham, president and CEO of SureWest. He said several factors continue to create declines in legacy telecom services, including wireless substitution and competition, and loss of subsidies. But on the flip side, Oldham said buying Everest gave SureWest much of its gains on the video front.

“Continuing to grow our broadband segment, with an emphasis on increasing residential revenues and generating new business customers, remains a cornerstone of our growth strategy and solidifies our transformation to an advanced broadband triple-play provider,” Oldham said.

SureWest’s consolidated revenue from continuing operations increased 20 percent in the first quarter 2008 compared to the year-earlier quarter. The improvement came from a 64 percent increase in broadband sales and the integration of the Kansas City market, which offset a 7 percent decline in telecom revenues

SureWest sees FTTH, along with more HD content and video-on-demand services, as ongoing bright spots. Executives said conversion to fiber is a big priority since the company is losing customers from the video-over-copper portion of its network assets. Everest had built a hybrid fiber/ coax network in Kansas City.

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