Comcast outpays Frontier in Indiana franchise fees

If, as beancounters maintain, numbers tell stories, then the big story in Fort Wayne, Ind. (and perhaps elsewhere) is that Frontier Communications' (NYSE: FTR) FiOS pay TV service business is on the wane. In the first quarter, Comcast (Nasdaq: CMCSA) paid $376,000 in franchise fees compared to Frontier's $343,000, showing an apparent subscriber switch since Frontier paid more ($384,000) than Comcast ($353,000) in the previous quarter, in figures provided by the Fort Wayne Journal Gazette.

Frontier is revamping its FiOS TV offering--to put it mildly. Most observers believe the company wants to abandon FiOS and is doing everything it can to steer customers away from wireline service to satellite provider DirecTV (Nasdaq: DTV). Frontier raised FiOS rates 30 percent in Fort Wayne to start the year and, concurrently, the franchise fees slide.

Pay TV providers pay 5 percent of either their gross annual subscriber receipts or gross annual receipts, whichever is higher, to the city. Since neither company announces subscriber figures, the franchise fees serve as the best barometer of how things are going.

And they're not going well for Frontier, apparently. Comcast, which didn't comment for this story, had said earlier it was seeing some fallout from the FiOS rate hikes. A Frontier spokesman conceded to the newspaper that it was losing some subscribers. "We would like to keep every single customer," the spokesman said, but, "we're always concerned about competing."

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