YEAR IN REVIEW: GCI completes wireless acquisition; Arctic fiber advances

Alaska’s two largest telecommunications companies are showing positive growth after shuffling the state’s wireless customers.

In 2014, General Communications Inc. agreed to a $300 million deal with to Alaska Communications Systems Group Inc for all the latter company’s wireless subscribers and 33 percent of Alaska Wireless Network, a combination of both companies’ wireless infrastructure.

ACS has used the proceeds from the deal to pay down its debt, and now focuses on its broadband business.

The deal has yielded results for GCI’s balance sheet. GCI raised third quarter consolidated revenue by 7.4 percent from 2014, from $240.7 million to $258.6 million, and $10 million greater than second quarter 2015. GCI reported $19.9 million in net income in the third quarter of 2015 compared to $9.9 million in the third quarter of 2014.

Alaska Communications revenue is down, but net income through nine months is up.

Net income through three quarters of the year for Alaska Communications was $12.6 million compared to just $2.6 million for the same nine months of 2014. That is despite total operating revenues declining to $54.7 million from $78.4 million in the third quarter of 2014.

2. Quintillion lays fiber for northern Alaska

Alaska’s Northwestern communities are one step closer to joining the worldwide data sphere.

Alaska fiber optic provider Quintillion Subsea Holdings LLC signed a turnkey contract with French telecom Alcatel-Lucent for an undersea fiber optic cable network stretching across Nome, Kotzebue, Wainwright, Point Hope, Barrow, and Prudhoe Bay and will provide for future extensions to Asia and Europe.

The undersea cable forms the coastal border of a broadband arc that will cover most of the populated Arctic by 2018. Quintillion, based in Anchorage, also plans to run a fiber optic cable from Deadhorse to Fairbanks, scooping most of the northern Alaska population into range of its overland and undersea cables.

ASTAC, which provides broadband service and wireless coverage for Deadhorse, Kotzebue, Wainwright, Barrow, and Point Hope, will eventually have to upgrade each town’s broadband infrastructure to make full use of Quintillion’s fiber network.

3. Alaska Communications acquires North Slope fiber

Efforts to bring data plans to rural areas and remote workspaces got another boost in 2015 with a ConocoPhillips broadband contract.

Quintillion Networks also partnered with Alaska Communication Systems Group Inc., to operate the infield fiber optic cable on ConocoPhillips’ North Slope oilfields and begin a multi-year service provision contract for the oil company.

Internet service to ConocoPhillips Slope operations was formerly available, but largely from older, expensive legacy installations of microwave towers and satellite relays.

The fiber runs from Kuparuk River and Colville River units to Pump Station 1 of the Trans-Alaska Pipeline System.

ConocoPhillips had installed the cable on its own, but decided the management of the cable’s high capacity, which was unfamiliar for the oil company, would better belong in a broadband expert’s hands.

Alaska Communications has hired several supervisory positions to oversee the integration of the ConocoPhillips cable into its network, which should be complete by the end of 2015. ACS has also ordered new equipment to add to the cable’s existing capacity.

 

DJ Summers can be reached at daniel.summers@alaskajournal.com.

Updated: 
12/16/2015 - 1:55pm

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