Century Link takes large chunks from CAF - great for CLFD
Century Link announced today that it will accept $54 million from the Federal Communications Commission's Connect America Fund (CAF) this year to bring broadband to more than 92,000 rural homes and businesses in unserved high-cost areas.
When combined with its copayment, CenturyLink will invest more than $108 million over the next three years to bring broadband speeds of 4 Mbps downstream and 1 Mbps upstream to rural households and businesses in 33 of the 37 states where it offers residential broadband service. The company's investment of its own capital will exceed the amount of CAF phase I, round 2 funding it accepts.
Earlier this year, close to 100 members of Congress from both parties urged the FCC to quickly distribute CAF phase I, round 2 money to bring broadband to more rural Americans.
"We commend the FCC for its collective commitment to bringing the many benefits of high-speed Internet service to unserved high-cost areas of rural America," said Steve Davis, CenturyLink executive vice president for public policy and government relations. "CenturyLink is investing millions of dollars to deploy broadband to thousands of Americans who live in areas that would be cost prohibitive to serve without programs like the FCC's Connect America Fund."
CenturyLink was eligible to receive $90 million in CAF phase I, round 2 money, but the FCC's market eligibility restrictions made further deployment uneconomic.
The $54 million is in addition to $35 million in CAF phase I, round 1 money that CenturyLink accepted in 2012 to deploy broadband service to 45,000 homes and businesses in unserved rural areas. Through the CAF I program, CenturyLink is deploying broadband to nearly 140,000 unserved rural consumers.
Frontier asks for a bigger slug - all great for CLFD
Frontier Communications has asked the FCC for over $71.5 million from the Connect America Fund (CAF) as it looks to build out broadband service to an additional 119,000 households.
If it does get the funds, the telco said it would be able to extend broadband services to various underserved areas that are today too expensive to justify deploying network infrastructure.
Winning these additional funds will complement the $2.2 billion the service provider has already spent of its own capital since purchasing Verizon's rural lines in 2010 to increase broadband access and improve network infrastructure throughout its serving area.
All of this probably won't be reflected until the next earnings statement. Volume is low, volatility is high, it's August, and lots of people left the stock after the last earnings statement (for whatever reason). Maybe they are waiting for the next one to reevaluate their positions. Meanwhile I shorted CLFD today and made $ =)