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Frontier CEO Maggie Wilderotter dismisses the "hype" around Google Fiber: "We have to take the mystery and the technology out of the experience for the user because it's a bit disrespectful to speak a language our customers don't understand."

(Bloomberg Photo)

You don't need a gig.

That's the case Frontier Communications chief executive Maggie Wilderotter is making as Google Fiber readies a charge into the Portland area, perhaps as soon as next year.

Frontier’s CEO on net neutrality and more

Connecticut-based Frontier Communications is the nation’s fourth-largest local phone company, with 3.1 million customers and 13,650 employees. It’s shifting rapidly from its declining landline phone business and has roughly 2 million broadband subscribers – primarily in rural areas.

Revenue last year totaled $4.8 billion, with profits of $113 million. Frontier’s Oregon its service territory include Beaverton, Forest Grove, Hillsboro, Lake Oswego, Tigard, Tualatin, Gresham and many rural communities in central, eastern and coastal Oregon.

Every July the company’s board meets in one of its service territories, and this month it’s Oregon’s turn. In an interview with The Oregonian this week, chief executive Maggie Wilderotter offered her thoughts on a number of hot topics in tech:

Net Neutrality

: Currently before the FCC, net neutrality is the principle that all traffic on the Internet should be treated equally. Frontier gives Netflix special access to its network to improve connection speeds for video streaming and, unlike Comcast, doesn’t charge Netflix. But Wilderotter left open the possibility she might one day charge, and doesn’t want federal regulation standing in the way: “Our shareholders build these networks. They’re not government networks.”

Comcast's customer service fiasco

:

when a call center worker refused to disconnect a customer’s service without an explanation of why he was quitting. Wilderotter said the call reflects a broken model for customer service that favored individual sales over understanding customers’ motivations, tying pay too closely to sales sales: “When you incent (customer service personnel) on behaviors that are the wrong behaviors you get the wrong result.”

The future of cable TV

: Frontier offers cable TV in its Portland territories but in few other markets. Wilderotter said the future is in streaming: “Streaming video is a very powerful alternative to the 500 channel package.”

Google Fiber

: As Google Fiber contemplates a massive buildout across Frontier’s territory in the Portland area, residents have wondered if Frontier might lease space on its existing fiber network to its competitor so Google doesn’t have to dig up streets for its own fiber. Wilderotter’s answer was unequivocal: “No.”

-- Mike Rogoway

Google promises "gigabit" speeds for residential users – 1,000 megabits per second, roughly 20 times a typical broadband Internet connection today.

The company says it will decide by the end of this year whether to build a residential fiber-optic network to homes in Portland and five smaller cities nearby.

Frontier, which has had a monopoly on residential fiber in Portland's suburbs since acquiring Verizon's FiOS service four years ago, says Google is pitching something consumers don't understand, and don't need.

"Today it's about the hype, because Google has hyped the gig," said Wilderotter, in Portland this week for a meeting of her company's board. She said Google is pitching something that's beyond the capacity of many devices, with very few services that could take advantage of such speeds, and confusing customers in the process.

"We have to take the mystery and the technology out of the experience for the user because it's a bit disrespectful to speak a language our customers don't understand," said Wilderotter, in Portland this week for a meeting of her company's board.

Frontier's pitch: Better prices for more modest speeds. For most people, Wilderotter said, 10 to 12 megabits per second will be perfectly adequate for at least the next couple years. She said Frontier is upgrading its networks in rural communities where it doesn't offer FiOS to meet that benchmark.

Frontier FiOS offers 15 mbps for $30 a month. That's a fraction of the speed Google promises, but less than half Google's $70 monthly charge.

Frontier will offer gigabit packages, too, Wilderotter promises, within "the next several quarters," as services emerge that justify such speeds.

But she said Frontier will also offer tiered services, with discounts for customers below certain thresholds.

Some consumer advocates loathe the notion of a usage cap, but Wilderotter says it's a model subscribers are familiar with – from cell phone plans – and will accept if it comes with a corresponding discount.

With its landline phone business in precipitous decline (see chart below), Frontier is moving aggressively toward broadband.

Eventually, Wilderotter said, the company hopes to bundle video streaming services with its Internet plans – an alternative to cable TV that would offer subscribers some favorite channels without paying full freight for dozens or hundreds of cable TV networks.

Frontier offers fiber-optic service in a number of smaller cities in the metro area, including Beaverton, Hillsboro, Gresham and Lake Oswego. All are on Google Fiber's radar, too. (Frontier doesn't serve Portland itself, which is in CenturyLink's service territory. CenturyLink has begun offering gigabit service in select areas of the city.)

Many markets have just one company offering broadband Internet and cable TV. This time next year, parts of the metro area could have three if Google Fiber jumps into the market with Frontier and Comcast. Satellite TV services offer more options.

Frontier's strategy, at odds with Google's approach, suggests there may be some real differences in how companies market themselves and pitch their services.

"You're going to get a lot of new, competitive options," said Donna Jaegers, telecom analyst for D.A. Davidson. "It should be good for consumers, at least, because you get more choice."

Gigabit service is indeed overkill for most people, Jaegers said, noting that she has 6 mbps at home and does just fine. She said that Frontier's value-conscious pitch will appeal to consumers so long as the economy stays weak.

Google has an enormously powerful brand, though, and has proven savvy about building public fervor for its top-shelf service.

"Certainly you're going to have a part of the market," Jaegers said, "that just wants what's new and what's fastest."

-- Mike Rogoway; twitter: @rogoway; phone: 503-294-7699