altafiber, together with its subsidiaries, provides integrated telecommunications and IT solutions that keep consumer and business customers connected with each other and with the world.
Segments
The company operates its businesses through the following segments: Network, and IT Services and Hardware.
Network segment
The Network segment serves customers in the Greater Cincinnati region through the company’s altafiber brand and services customers in Hawaii through its Hawaiian Telcom brand, t...
altafiber, together with its subsidiaries, provides integrated telecommunications and IT solutions that keep consumer and business customers connected with each other and with the world.
Segments
The company operates its businesses through the following segments: Network, and IT Services and Hardware.
Network segment
The Network segment serves customers in the Greater Cincinnati region through the company’s altafiber brand and services customers in Hawaii through its Hawaiian Telcom brand, the company provides high-speed data, video, and voice solutions to consumers and businesses over an expanding fiber network and a legacy copper network. During 2018, the company acquired Hawaiian Telcom Holdco, Inc. (Hawaiian Telcom), the largest full service provider of communication services on all of Hawaii's major islands. This acquisition added operational scale to the company’s business by adding access to both Honolulu, a well-developed, fiber-rich city on Oahu, as well as the growing neighbor islands. As a result of the acquisition, the company's combined fiber networks are approximately 20,400 fiber route miles. On May 2, 2022, the company acquired Agile IWG Holdings, LLC (Agile). Agile delivers customers, primarily located in Ohio and Pennsylvania, with middle mile, last mile and campus connectivity services through hybrid fiber wireless networks that are designed, built and managed by Agile.
The Network segment provides products and services that can be categorized as either Fioptics, Enterprise Fiber or Legacy.
The Network segment provides products and services, such as high-speed internet, data transport, local voice, video and other services. Cincinnati Bell Telephone Company LLC (CBT), a subsidiary of the company, is the incumbent local exchange carrier (ILEC) for a geography that covers a radius of approximately 25 miles around Cincinnati, Ohio, and includes parts of northern Kentucky and southeastern Indiana. CBT has operated in this territory for approximately 150 years. In 2022, the company started their network expansion outside of this territory to provide fiber services to Dayton, Ohio. Voice and data services in the Enterprise Fiber and Legacy categories that are delivered beyond the company's ILEC territory, particularly in Dayton and Mason, Ohio, are provided through the operations of Cincinnati Bell Extended Territories LLC (CBET), a subsidiary of CBT. Hawaiian Telcom, a subsidiary of the company, is the ILEC for the state of Hawaii and the largest full service provider of communications services and products in that state. Originally incorporated in Hawaii in 1883 as Mutual Telephone Company, Hawaiian Telcom has a strong heritage of nearly 140 years as Hawaii’s communications carrier. Its services are offered on all of Hawaii’s major islands, except its video service, which is only available on the island of Oahu. On May 2, 2022, the company acquired Agile, based in Canton, Ohio. Agile leases wireless infrastructure assets to third parties and provides connectivity through hybrid fiber wireless data networks primarily to customers in Ohio and Pennsylvania.
Data
The company's data products include high-speed internet access, data transport and interconnection services. Consumer demand for increased internet speeds is accelerating, and more customers are opting for higher bandwidth solutions. To address this demand, the company focuses on building out new FTTP addresses, as well as overlaying FTTN addresses, enabling these addresses to receive speeds up to one gigabit per second (Gbps). FTTP addresses cover nearly 80% of the market in Greater Cincinnati and more than 40% of the market in Hawaii, of which approximately 657,200 and 268,000 addresses are capable of receiving speeds up to one Gbps in Greater Cincinnati and Hawaii, respectively.
As business customers migrate from legacy products and copper-based technology, the company’s metro-ethernet product becomes the access method of choice due to its ability to support multiple applications on a single physical connection. The company is also expanding its metro-ethernet platform to deliver services across a wider geography to target business customers beyond its ILEC footprint. The company’s regional network connects Greater Cincinnati, Columbus, and Dayton, Ohio, as well as Indianapolis, Indiana, Chicago, Illinois, and Louisville, Kentucky.
Voice represents local service over both copper and fiber. It also includes consumer long distance, digital trunking, switched access and other value-added services, such as caller identification, voicemail, call waiting and call return.
The company's voice access lines over copper continue to decrease as its customers have increasingly employed wireless technologies in lieu of wireline voice services (wireless substitution), migrated to competitors, or migrated to VoIP services provided by the company and others.
Customers purchasing traditional long distance service can choose from a variety of long distance plans, which include unlimited long distance for a flat fee, purchase of minutes at a per-minute-of-use rate, or a fixed number of minutes for a flat fee. The company's long distance lines and related minutes of use have continued to decline as a result of wireless substitution.
Video
In the Greater Cincinnati territory, the company launched Fioptics in 2009 and initially focused its fiber network investment on densely populated areas, such as apartments and condominiums. Since that time, Fioptics has been deployed over a much broader base and is available to more than 85% of Greater Cincinnati. As of December 31, 2022, the company had 123,100 video subscribers in Greater Cincinnati. The company’s Fioptics customers enjoy access to over 400 entertainment channels, including digital music, local, movie and sports programming with over 150 high-definition channels, parental controls, HD DVR and video On-Demand.
In Hawaii, the company launched its next-generation television service on the island of Oahu in July 2011. The TV service is 100% digital with hundreds of local, national, international and music channels, including high-definition, premium, pay-per-view channels and video on-demand service. TV service has been deployed to 36,000 subscribers in Hawaii as of the end of 2022.
Other
Other revenue consists of revenue generated from wiring projects for business customers, support from the Connect America Fund and Rural Digital Opportunity Fund, advertising, directory assistance, maintenance and information services. Beginning in 2021, Other revenue also includes subsidized fiber build project revenue related to extending the company’s fiber network in the Greater Cincinnati territory subsidized through its UniCity program. Subsidized fiber build project revenue related to extending the company's fiber network in Hawaii is included in Other revenue beginning in 2022.
IT Services and Hardware segment
Through its IT Services and Hardware segment, business customers across the U.S., Canada and Europe rely on the company for the sale and service of efficient, end-to-end communications and IT systems and solutions. The IT Services and Hardware segment services customers in the U.S. and Europe through its CBTS brand and in Canada through its OnX brand.
The IT Services and Hardware segment provides a full range of managed IT solutions, telephony and IT equipment sales, and professional IT staffing services. These services and products are provided through the company's subsidiaries in various geographic areas throughout the U.S., Canada, Europe and India. By offering a full range of Infrastructure Solutions in addition to Cloud, Communications and Consulting services, the IT Services and Hardware segment provides end-to-end IT solutions designed to reduce cost and mitigate risk while optimizing performance for its customers.
The key products and services provided by the IT Services and Hardware segment include the following:
Consulting
The company's consulting services offerings consist of IT staffing and project-based engagements, including engineering and installation of voice, connectivity and IT technologies, development of digital application solutions and staff augmentation by highly skilled and industry-certified technical resources. Engagements can be short-term IT implementation and project-based work as well as longer term staffing and permanent placement assignments. The company utilizes a team of experienced recruiting and hiring personnel to provide its customers with a wide range of skilled IT professionals. These professionals are comprised of employees and contractors located in the U.S., Canada, Europe and India.
Communications
The company offers a complete portfolio of hosted solutions that include converged IP communications platforms of data, voice, video and mobility applications. The company offers its customers expert management for all hardware and software components, including maintenance contracts and service level agreement (SLA) based services. Fully hosted and managed, these voice platforms and applications can also be delivered as a service for a monthly utility fee allowing its customers to scale without a large capital investment.
The solutions offered in the Communications practice include UCaaS, SD-WAN, NaaS, Contact Center and other Networking Solutions. UCaaS provides a portfolio of solutions that includes VoIP, room-based video, mobile solutions, chat/presence, messaging, web conferencing, audio conferencing, social media, contact center solutions, and more in order to serve a customer's collaboration needs. Cloud delivered SD-WAN is a revolutionary, agile platform to deploy, manage and monitor hybrid public, private, wireline and wireless networks. NaaS is a fully managed networking solution with cloud integration, security, switching, Wi-Fi, management, monitoring and SD-WAN. The company’s Contact Center offering features speech-enabled Interactive Voice Response (IVR), call-back services, call analytics and surveys, speech analytics, alerts and notification, and improved customer satisfaction and productivity. Additionally, the company manages the maintenance of a large base of customers with traditional voice systems, as well as converged VoIP systems under Networking Solutions.
Cloud
Virtual data center (VDC) is a robust and scalable virtual infrastructure consisting of equipment, security, people and processes. This offering is provided in three different models - private cloud, dedicated cloud or public cloud - and provides customers with either a long-term or a short-term flexible solution that is fully managed by the company and monitored around the clock from its Enterprise Network Operations Center (ENOC).
Storage is a flexible, on-demand solution that enables businesses to eliminate capital expenditures and ongoing asset management with SLA-based services. The company offers Tier I, Tier II and Tier III storage to meet its customers' availability, accessibility, protection, performance and capacity needs.
Backup is a scalable solution that allows businesses to eliminate capital outlay and ongoing equipment management with SLA-based services and includes virtual data center, hardware, software, monitoring and support.
The company provides SLA-based monitoring and management services utilizing its ENOC. The ENOC includes highly certified engineers and operation experts that proactively monitor and manage the company’s customers’ technology environments and applications. Standalone monitoring services provide customers with scheduled and automatic checks of customers' servers, routers, switches, load balancers and firewalls. The company also provides customers with advance trouble shooting, repair and changes of customers' servers, routers, switches, load balancers and other network devices from its ENOC. These services can be provided to customers with equipment provided by the company or customer-owned equipment and do not have geographical constraints. Services can be purchased individually or bundled by combining multiple products, services, and assets into a utility or service model.
Infrastructure Solutions
The company maintains premium resale relationships and certifications with a variety of branded technology vendors, which allows it to competitively sell, architect and install a wide array of telecommunications and IT infrastructure equipment to meet the needs of its customers.
Strategy
The key elements of the company’s strategy are to expand its fiber network; and grow its IT Services and Hardware segment.
Sales and Distribution Channels
The company’s Network segment utilizes a number of distribution channels to acquire customers. As of December 31, 2022, the company operated seven retail stores in the Greater Cincinnati area and one retail store in Dayton, Ohio to market and distribute its Fioptics suite of products. The company works to locate retail stores in high traffic but affordable areas, with a distance between each store that considers optimal returns per store and customer convenience. The company also offers fully-automated, end-to-end web-based sales of various other Company services and accessories for both the Cincinnati operating territory and the Hawaii operating territory. In addition, the company utilizes a call center, as well as a door-to-door sales force, to target the sale of its consumer products to residents.
For both operating segments, the company utilizes a business-to-business sales force and a call center organization to reach business customers in its operating territories. Larger business customers are supported by sales account representatives and solution architects located in the company’s branch offices across the U.S., Canada and Europe that understand the customer's technology needs and recommend Company-offered solutions. Smaller business customers are supported through a telemarketing sales force, customer representatives and store locations.
The IT Services and Hardware segment utilizes an indirect distribution channel to sell services, primarily focused on Communications. Compensation to the distributor is success-based and typically involves a residual payment based on revenue from customers.
Suppliers and Product Supply Chain
As of December 31, 2022, approximately 70% of the company’s programming was sourced from the NCTC and approximately 50% of Hawaiian Telcom’s programming was sourced from the NCTC.
The company is a certified distributor of leading technology and software solutions, including but not limited to, Cisco, Hewlett-Packard, Dell and IBM.
In addition, the company has long-term commitments to outsource various services, such as certain information technology functions, cash remittance and accounts payable functions, call center operations and maintenance services.
Customers
As of December 31, 2022, Verizon Communications Inc. (Verizon) consisted of 21% of consolidated accounts.
History
altafiber, formerly known as Cincinnati Bell Inc., was founded in 1873. The company was incorporated in 1983.
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