A new-wave broadband firm dials up Frontier Communications

General Telephone, GTE, then Verizon and Frontier — what’s next for our legacy phone company?

Steven Weed, CEO of WaveDivision Capital.

Steven Weed, CEO of WaveDivision Capital.

EVERETT — Last year, Steve Weed, then the CEO of Wave Broadband, sold the Kirkland-based company that he founded in 2003 for $2.36 billion.

The buyer, TPG Capital, is one of the largest private equity firms in the world, according to financial experts.

But the sale of the company didn’t sever Weed’s ties to telecommunications.

As CEO of WaveDivision Capital, a private equity firm he launched in 2003, Weed has continued to invest in broadband providers.

Now he’s about to jump back into the local broadband scene.

Kirkland-based WaveDivision and Searchlight Capital Partners, which has offices in New York, Toronto and London, announced last week they’re buying the Northwest operations of Frontier Communications for $1.36 billion.

“Our plan is to invest further in our markets, specifically by extending fiber to more homes and businesses, to bring them the high speeds they want,” Weed said in a news release.

Beyond that written announcement last week, WaveDivision declined to comment or elaborate “due to regulatory requirements,” a company spokesman said.

Weed’s company is buying what was once the Everett area’s legacy landline telephone company.

Today, Frontier Communications offers television and internet services in addition to phone service. But the origin of the business, two owners ago, was General Telephone & Electronics Corp., the largest independent phone company during the days of the massive Bell Telephone system, when landline telephone service was a regulated monopoly.

General Telephone eventually changed its name to GTE. GTE Northwest, which served Idaho, Montana, Oregon and Washington, was founded in 1964 as one of GTE Corp.’s operating companies.

Deregulation eventually freed telephone providers and cable TV companies to compete and provide the full range of telecommunications — TV, internet, landline phone and cellular service. In 2000, Bell Atlantic Corp. and GTE merged to become Verizon Communications.

In 2010, Verizon sold its landline phone assets to Frontier Communications.

Today Frontier serves about 156,000 residential and business customers in Washington and another 194,000 in Oregon, Idaho and Montana, according to the Washington Public Utilities and Transportation Commission. In Washington, Frontier serves customers in Snohomish, Skagit and Whatcom counties and eastern portions of the state.

The company’s Western Washington headquarters is in Everett, in a building GTE had built in 1981 at 1800 41st St. In 2018, Frontier employed about 590 here.

Frontier sold the building in 2012 but still occupies the north tower. (The Daily Herald and its parent, Sound Publishing, leases part of the third floor of the south tower.)

For Frontier, based in Norwalk, Connecticut, the cash deal with Weed’s company helps reduce debt. The deal is expected to close by the end of the year and is subject to approval by the Federal Communications Commission, the U.S. Department of Justice and the Committee on Foreign Investment in the United States.

Frontier said it will continue to operate the business and serve customers with existing products and services until the transaction closes.

WaveDivision said no immediate changes are planned that would affect customers or regional Frontier employees.

WaveDivision has investments in telecom companies all over North America. They include Hargray Communications in South Carolina; Metronet Communications in Evansville, Indiana; and RCN/Wave/Grande, serving parts of Massachusetts, Chicago, Pennsylvania, New York City, Washington, D.C., Texas, Washington, Oregon and California; and Xplornet based in New Brunswick, Canada.

WaveDivision’s managing directors include former Wave Broadband executives Harold Zeitz and Wayne Schattenkerk.

Janice Podsada; jpodsada@heraldnet.com; 425-339-3097; Twitter: JanicePods.

Talk to us

More in Herald Business Journal

FILE - In this June 17, 2015 file photo, an Airbus A350 performs a demonstration flight at the Paris Air Show, in Le Bourget airport, north of Paris. Airbus announced Wednesday Jan. 11, 2017 that it delivered 688 planes over the year, primarily in the single-aisle A320 family, compared with 635 in 2015. The company increased deliveries of its long-delayed A350 wide-body. (AP Photo/Francois Mori, File)
Union leaders: As Boeing shrinks, what about Airbus?

They told state senators that old allegiances aren’t worth much in these economic hard times.

Inside the new Quil Ceda Creek Casino's open floor that will contain 1,500 slot machines on Wednesday, Oct. 28, 2020 in Tulalip, Wa. (Olivia Vanni / The Herald)
An early 2021 opening is in the cards for new Tulalip casino

The 126,700-square-foot Quil Ceda Creek Casino will replace the current one across the road.

The nose of the 500th 787 Dreamliner at the assembly plant in Everett on Wednesday morning on September 21, 2016. (Kevin Clark / The Herald)
Boeing says it has no plans for 787 or 747 factory space

The two models will leave Everett in coming years. Meanwhile, thousands of more jobs will be eliminated.

A Boeing 777X airplane flies over Moscow, Idaho. during a test flight Tuesday, June 23, 2020. The new model of airplane had its first flight on Jan. 25, 2020, from Paine Field in Everett, Wash. The 777X will be the world's largest and most efficient twin-engine jet, according to Boeing. (Geoff Crimmins/The Moscow-Pullman Daily News via AP)
‘The market has spoken’: Jet buyers see a grim Boeing future

The company reports third-quarter results on Wednesday with two key products in deep trouble.

The Hanford nuclear site. (Business Wire)
Longer transition allowed for $16B in contracts at Hanford

The plan will help employees comply with safety guidelines intended to limit the spread of COVID-19.

An Israeli Air Force Boeing AH-64 Apache attack helicopter from the 113th Squadron, also known as the Hornet Squadron, lands during a display for the foreign press in Ramon air force base near the Israeli town of Mitzpe Ramon, in the Negev desert, southern Israel, Monday, Oct. 21, 2013.(AP Photo/Ariel Schalit)
Boeing’s Arizona chopper plant under scrutiny by Army team

The company reported quality problems it says were caused by a derelict technician.

Bill McSherry, vice president of government operations for Boeing Commercial Airplanes, walks back to his seat, Tuesday, Feb. 25, 2020, after testifying before the House Finance Committee at the Capitol in Olympia, Wash. The committee was hearing testimony on a bill introduced at Boeing's request to suspend the aerospace giant's preferential business and occupation tax rate in Washington state unless the United States and European Union reach an agreement on their long-running international trade dispute that would allow the lower tax rate. Last year, the World Trade Organization body ruled that Boeing received an illegal U.S. tax break from Washington state that damaged sales by European archrival Airbus. (AP Photo/Ted S. Warren)
A Boeing executive delivers good and bad news for Everett

The commercial headquarters could indeed come to Paine Field. But demand for big jets will not rebound quickly.

FILE - An American Airlines Boeing 737-823 lands at Miami International Airport, Monday, July 27, 2020, in Miami.American Airlines said Tuesday, Aug. 25 that it will furlough or lay off 19,000 employees in October as it struggles with a sharp downturn in travel because of the pandemic. Flight attendants will bear the heaviest cuts, with 8,100 losing their jobs.  (AP Photo/Wilfredo Lee, File)
American plans flights with Boeing 737 Max by year-end

Customers can see on American’s website the type of plane for any flight if they know where to click.

Patrick Ky, executive director of the European Aviation Safety Agency, in Amsterdam on Nov. 27, 2018. MUST CREDIT: Bloomberg photo by Yuriko Nakao.
Boeing Max judged safe to fly by Europe’s aviation regulator

A synthetic sensor to aid pilots when the mechanical angle-of-attack sensors fail is still two years out.

The Boeing factory at Paine Field in Everett. (Boeing Co.)
Could Everett become Boeing’s next jetliner headquarters?

The company is considering selling the Commercial Airplanes division offices at Longacres in Renton.

Cop turned pinup model in Gold Bar charged with $67K fraud

Brenda Cavoretto was injured when a dead body fell on her in 2012. She’s accused of overselling its lasting impact.

Washington unemployment rate drops to 7.8%

Most job growth occurred in leisure and hospitality, construction and other services.