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At 10, Windstream Focuses On Midmarket Future

3 min read

Windstream Holdings Inc., the publicly traded spinoff of Little Rock’s Alltel Corp., recently celebrated its 10th anniversary, saying its first decade has sharpened its focus on midmarket business customers, although it also has residential, small business and wholesale customers.

Midmarket refers to companies that have annual revenue ranging from $50 million to $1 billion.

Windstream started as a spinoff of Alltel’s wireline business, which was focused on traditional telephone services, like landlines that seem nearly extinct, and rural areas. Alltel kept the wireless half of the business and was acquired by cellphone giant Verizon.

Now Windstream has four distinct segments — two that provide landline service and broadband internet to homes and small businesses, one that provides bandwidth and transport services to wholesale carriers and the largest, its enterprise segment that serves those midmarket business customers.

That segment generated the most in annual revenue for 2015, $2.1 billion of the $5.77 billion total, according to the firm’s annual report filed with the Securities & Exchange Commission.

Windstream’s 25,000 enterprise customers use various streamlined offerings inluding two newcomers: fixed wireless and unified communications as a service, which Windstream calls UCaaS.

Fixed wireless and UCaaS are products launched about two years ago, according to Joseph Harding, executive vice president and chief marketing officer for the enterprise unit. But availability of fixed wireless was limited at first, and plans call for expanding UCaaS into 25 additional markets through 2017.

Fixed wireless internet is achieved by installing antennas on the roofs of office buildings. The antennas allow internet access over relatively short distances without the building being connected to a buried fiber cable.

Instead, the rooftop antennas connect wirelessly to a cable-connected main antenna atop a tall building some distance away, Harding said.

Fixed wireless internet service through Windstream is available in Little Rock. It can provide speeds of up to 1 gigabit per second and is often used as backup access, in case a wired connection goes down, he said. But Harding added that some of those midmarket business customers use it exclusively, although it is also sold in a package with Windstream’s wired internet service.

Harding said UCaaS, a cloud-based platform, replaces the private telephone systems businesses are accustomed to. Those systems required equipment that was physically located at an office to connect calls and perform other functions. UCaaS instead performs the same functions and more in the online cloud.

With UCaaS, a business customer’s employees can do traditional things like making phone calls, but also nontraditional things like seeing if co-workers are online, instant messaging or video chatting with them, or accessing work applications from their cellphones, he said.

Customers with UCaaS also have the flexibility to easily scale services as they gain or lose employees, Harding said.

He added that UCaaS enables business customers to integrate their apps and save a lot of money by moving away from “obsolete” technology. And that is part of what Windstream wants to do for its midmarket business customers.

Harding said the firm’s goal is to be the “pre-emptive” strategic network partner for those customers — “to be their adviser and help them think about how to take their technology from where they are today to where they need to be to compete in whatever industry they happen to be a part of.”

One way Windstream is pursuing that goal is by investing in its network by purchasing fiber cable to expand its reach in the metropolitan areas it already serves, Harding said.

In Arkansas, that investment in improving infrastructure has totaled $350 million over the last decade, CEO Tony Thomas told the Rotary Club of Little Rock a few weeks ago.

He also referred to two big technological shifts happening in the telecom industry: transitioning to a faster Ethernet/IP infrastructure and the migration of storage and services to the cloud.

UCaaS does the latter, and, as it turns out, fixed wireless provides Ethernet connectivity, according to Windstream’s website.

Harding said that in the last 10 years, Windstream had “evolved considerably” by seeking to offer the latest in technology to its customers. The firm has grown from approximately 8,000 employees to more than 12,000 nationwide, but he said its “true north” of “delivering world-class customer service” has remained the same.

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