Cable operators RCN, Grande Communications, Wave Broadband, enTouch and commercial fiber-services provider Digital West said they will officially consolidate their brands under the Astound Broadband name effective today (January 12).

“This is an exciting time for our company with our new name solidifying our commitment to ‘astound’ our customers each and every day through our national fiber-rich network, fast reliable service, mission-critical connectivity, and award -winning customer service,” Astound Broadband CEO Jim Holanda said in a statement. “Keeping ourselves grounded in our deep-rooted focus on customer service is at the core of what we do. We’ve been part of our local communities for years. Our dedicated teams will continue to serve the areas where they live and work.”

Astound Broadband has more than 1 million customers, which is enough to rate as the sixth largest cable operator in the U.S. 

To ease the transition, each region will retain sub-brands under the Astound umbrella — Astound Broadband powered by RCN, in the Northeast; Astound Broadband powered by Grande in Texas and Astound Broadband powered by Wave on the West Coast. The former Harris Broadband systems in Central Texas and WOW properties in Illinois, Indiana and Maryland will follow by mid-year. For business services, the combined companies will be unified as Astound Business Solutions. 

In an interview, Holanda said the sub-brands will probably last between 12 and 24 months, and then all of the systems will be branded under the Astound umbrella, “to ease customers and communities into it, to understand that they’re still dealing with the same local management, the same local employees and the same great service and company that they’re accustomed to.” 

Repainting trucks and issuing new uniforms to employees has already begun. 

In an interview, Holanda said the work to unite the companies under one name probably started about 2½ years ago.

“We knew after we bought Wave that at some point if we kept buying cable companies that we were going to have to unite the brand under a single name,” Holanda said, adding that while several names were considered, “We kept coming back to Astound.” 

The rebranding process was further delayed by the pandemic and later by former parent TPG’s decision to sell the company to Stonepeak Infrastructure Partners. The Stonepeak deal closed in August, near the end of the quarter, which made a rebranding unfeasible, and then 2021, a series of purchases helped push back the date even further. Astound closed its purchase systems in Anne Arundel, Maryland; Chicago and Evansville, Indiana in from Wide Open West for $661 million in November. Later, Grande Communications purchased Harris Broadband. 

Cable watchers should be familiar with the Astound Broadband name — it has been used as the moniker for the parent of the five smaller operators for years and dates back to former parent TPG’s 2017 purchase of Wave Broadband. Holanda said Wave purchased a Northern California provider named Astound Broadband about five years ago, which made selecting the name even easier. 

“We owned the domain names, we already had that in place, so when we started really digging into the research, not only did we love the [Astound] name and the aspirations of it, the fact we owned it made it almost a no-brainer at that point,” Holanda said. ■

Grande Communications, a division of Astound Broadband, said Tuesday that it has purchased Harris Broadband, provider of internet, voice and television services to about 6,000 customers in Central Texas.

The deal, terms of which were not disclosed, will fill out Grande’s Texas footprint, which includes Dallas, Austin, San Antonio, San Marcos, Corpus Christi, Waco, Temple, Houston and Midland/Odessa. In addition to about 6,000 customers in Brownwood and Early, Texas, , the deal will add 12,500 homes-passed and 150 miles of fiber plant to Grande’s operations in the state. The deal is expected to close later this year.

“We expect to combine Harris Broadband’s localized expertise and leadership with our broader network and resources to provide more services to more customers throughout Central Texas and beyond,” Astound Broadband and Grande Communications CEO Jim Holanda said in a press release. “We will leverage best practices from our family of companies to build upon Harris’s long track record of success in providing advanced broadband services.”

The deal comes weeks after Astound agreed to buy systems in Anne Arundel, Maryland; Chicago and Evansville, Indiana systems from overbuilder WideOpenWest for $661 million. 

Also Read: WOW Deal Will Double RCN’s Chicago Footprint, Astound CEO Says 

“We’re excited to become a part of the Grande Communications family,” said Harris Broadband president Philip Harris in a press release. “This transaction provides us with access to nationally recognized technical expertise, highly regarded operational management systems and processes, and unparalleled financial acumen to further the expansion of Harris Broadband. Moreover, this transaction is great for not only customers we currently serve, but surrounding communities in and around Brownwood and Early.”

Houlihan Lokey served as Harris’s financial advisor on the sale process. Seyfarth Shaw LP served as Grande’s legal adviser on the deal.  

In a year dominated by a pandemic and a nationwide inability to agree on practically anything, Patriot Media not only managed to help engineer the biggest system sale of the year for private-equity giant TPG Capital — the $8.1 billion sale of Astound Broadband to Stonepeak Infrastructure Partners — but it came in a way that will likely positively affect cable valuations in the years to come.

Led by CEO Jim Holanda, Multichannel News’s 2020 Executive of the Year, Patriot has been a constant in Astound’s operations in its various forms for about a decade, starting with the 2010 purchase of RCN by Abry Partners. After Abry sold RCN and Grande Communications to TPG in 2016 for $2.25 billion, Patriot continued to manage the assets and help TPG build its cable stronghold, later adding Wave Broadband and enTouch Communications to the mix. 

ALSO READ: Steve Simmons: The Original Patriot

Astound — there is still a question as to whether the new private-equity owners will keep the name — is the sixth-largest cable and broadband provider in the country, with about 1 million customers. But make no mistake, the company’s success over the years is a result of the astute stewardship of Patriot Media, which has steered somewhat disparate assets — a mixture of rural and urban systems, overbuilds and incumbent operations across eight states and the District of Columbia — through a business climate that could at times be hostile. 

“[Holanda] has really become the face of the middle market broadband industry,” said Garrett Baker, managing director at Lazard and group head of middle market telecom, media & technology. “Once you get past the big MSOs — Comcast, Charter, Altice — he’s become the most visible and most respected executive in that next level. He’s really become the biggest voice in the room and the face of that part of the industry.” 

In Cable Since the ’80s 

Holanda got his start in the cable industry on somewhat of a lark. After graduating from The Ohio State University in 1987 with a degree in political science, he and a college friend moved to Southern California and started looking for jobs. In 1988, his college buddy, a former cable installer, found the same work with Comcast.

“I had a college education and he had cable experience, so the deal was they had to hire us both because we only had one car,” Holanda said. 

After six months as a cable installer, Holanda moved up to Comcast’s accounting department and, after taking some additional accounting and business courses, moved to the finance department. In 1995, shortly after Comcast purchased systems from Maclean-Hunter, it moved him to another finance job in New Jersey. He stayed in New Jersey for another three years, moving on to Charter Communications when an opportunity to run systems arose.

“I grew up on the finance side of the business, but I always wanted to be in operations,” Holanda remembered. “When Charter bought AT&T in St. Louis, [then-Charter CEO] Jerry Kent and [then-chief operating officer] Dave Barford asked me to be the general manager and vice president of operations for all of St. Louis and the whole market. It was my first operations role.”

Holanda helped Charter integrate the AT&T system and spent four years at
the company, rising to regional VP of operations for its Central Region. In 2003, he joined former Simmons Communications founder Steve Simmons in his new venture, Patriot Media. 

“Steve’s a very convincing and compelling individual,” Holanda said, adding that Simmons drove home the point that getting the opportunity to build a company from the ground up doesn’t come often, even in the cable business. “I’ve learned over the last 18 years that I am, deep down, an entrepreneur.” 

That last quality, Simmons added, was a key reason why Holanda was hired.

“He recognized the importance of equity,” Simmons said. “I could see he had a real entreprenuerial spirit. After two days of grueling interviews — I even gave him my projects to analyze and a written exercise — I hired him. Every year for 18 years I’ve been thankful that decision was made. He’s been spectacular.”  

The going was anything but easy from the start. Patriot’s first system was a property in the Princeton, New Jersey area that needed a lot of work. 

“The Central New Jersey system, it was a complete and utter mess when we bought it,” Simmons said. Patriot had to create call centers, rebuild the plant, redo the channel lineup, overhaul technical operations and how people were trained and completely revamp the marketing systems and strategy. 

“I don’t want to skip over the challenges the Patriot Media team had when we entered Central New Jersey,” Simmons continued, adding that when he initially met with the mayors of the communities the systems served prior to buying the properties, he learned they had banded together to try to get the old owner ousted. About 12 months after Patriot bought the systems, those same mayors got together to praise the company for the massive changes they made.

“It was a real turnaround,” Simmons said. 

Patriot sold that system to Comcast in 2007, and soon after bought Puerto Rico cable operator Choice Cable TV, with the help of its Princeton system backer, Spectrum Equity Associates. That was just before the 2008 global recession, a period when deals were falling apart as banks and other financial institutions began tightening their belts. By applying the same strategy it used in Princeton, Patriot got Choice Cable back on its feet. 

“We owned that asset for seven and a half years, tripled cash flow over that period of time and made significant investments,” Holanda said. 

While running Choice Cable, Patriot and Spectrum Equity hooked up with Boston private-equity firm Abry Partners to look at its next target, then-publicly traded overbuilder RCN. Abry bought RCN in 2010 for about $1.2 billion, naming Simmons chairman and Holanda CEO of the overbuilder.    

The RCN deal also gave Holanda and the Patriot team first-hand, early exposure to the true power of broadband. Simmons remembered that RCN wasn’t necessarily a distressed company, but it needed work. But the company had already proven it wasn’t afraid of getting down in the dirt.  

“I think they realized that even though some of these businesses had challenging competitive profiles, they still had underlying positive trends, specifically around broadband,” Baker said. “They [Patriot] were able to take challenged businesses and put them together, created synergies, created growth strategies and eventually built a great business out of it.”

Still, overbuilders had a reputation of being tough businesses that require a lot of investment and face stiff competition from incumbents. Despite those drawbacks, RCN had something its competitors didn’t, Holanda said.  

Spotted Key Asset at RCN

“Clearly, after 20 years of being on the traditional side of the incumbent cable business, I never thought I would own or operate an overbuilder,” Holanda said. But as the companies conducted their due diligence, they found that RCN’s networks, built in the late 1990s and early 2000s, had two to three times the fiber of traditional cable networks, and much more excess fiber capacity per node. While the average cable system had 500 to 700 homes per node, RCN had built to under 150 homes per node.

“That network advantage was something that jumped out at us right away,” Holanda said. “It took us a little while to wrap our heads around that overbuilder nomenclature, but at the end of the day, a customer is a customer. 

“And whether you’re competing against a telephone company for those customers or a cable and telephone company, we’ve always seen competition ever since the satellite guys got into the video business, so we were used to it and not afraid of it,” he added. “Obviously, it turned out to be a really good gamble.”

That was evident in the rising valuation of the company. TPG bought RCN and much smaller Grande Communications in 2016 for about $2.5 billion — more than twice the original price Abry paid — keeping Patriot as an equity partner. In 2018, the company bought Northwest broadband company Wave Broadband for $2.36 billion and enTouch Communications was added earlier this year. Collectively, the assets are known as Astound Broadband. 

The mix of Astound’s assets, in rural, urban and midsized markets, has also proven to be an advantage, something larger cable operators are just beginning to see. For the past couple of years, Charter Communications and Comcast have been edging out their networks to smaller areas adjacent to their service footprints to take advantage of the demand for high-speed internet service.

Those moves by bigger companies haven't impacted Patriot’s or Astound’s business, Holanda said. 

“It hasn’t impacted us other than it kind of reaffirms the strategy that we’ve been pursuing for the last eight years,” Holanda said. “We already knew it was a good investment. It’s nice to see the industry recognizing that as well.” 

Boosted By Solid Backers

Holanda said having the support of its backers throughout the years also has been a big benefit to Patriot. Companies like Spectrum Equity, Abry and TPG have all helped finance Patriot’s moves over the past 18 years — and have allowed managers to run the business their way. 

“Private equity does not make quarter-by-quarter and year-by-year decisions about the business,” Holanda said. “They want to understand how we’re going to set it up for success over the next three years, the next five years, the next seven years.”

That includes Patriot’s earlier private-equity owner, TPG, which bought into RCN and Patriot about three years ago. Initially, Holanda said, TPG wasn’t looking to sell Astound. It was investigating several different scenarios, including going public, to push the company forward. 

“There wasn’t a rush to exit, but it was hard to ignore the fact that cable multiples were hitting record highs in the back half of 2019 and the early part of 2020,” Holanda said. “Being prudent equity investors, if there was an opportunity to take advantage of that in the public markets or the private markets, we wanted to be able to set ourselves up to do that.” 

Then, the pandemic hit and everything was put on hold, switching the company’s focus to day-to-day operations and keeping employees and customers safe. While there was initially  some doubt as to how COVID-19 would affect the economy, early signs were encouraging: federal stimulus packages were strong, the Federal Reserve kept loan flows humming and the bond market was performing well.

Patriot first created a new debt structure for Astound, allowing its investors to take a dividend. More importantly, that new structure included a portability feature that would eliminate the financing risk if they ultimately decided to sell the company or go public. 

That helped spur interest from potential suitors, and Holanda said he was surprised at the number of players (more than a dozen) that expressed interest in buying Astound.

But the combination of a robust broadband market, available capital and favorable financing made Astound an attractive target. And even in the pandemic, there is a lot of idle cash looking for a home. 

 “It hasn’t been front-page news, but the residential broadband market, broadly speaking, is stronger now than it’s ever been in my career,” Baker said. Fueling that strength are deep-pocketed infrastructure funds once focused on energy, airports and toll roads, he added. “The infrastructure funds, of which Stonepeak is one, are entering the industry incredibly aggressively,” Baker said. 

ALSO READ: Holanda: Astound Will Continue to Grow

Stonepeak partner and senior managing director Brian McMullen said the private-equity company isn’t a total stranger to residential broadband — it has an interest in Canadian residential provider Xplornet Communications — but Astound was a unique opportunity.

“We've looked at dozens and dozens of opportunities in North America and Asia-Pacific,” McMullen said. “We’ve looked at incumbent telcos, fiber-to-the-home overbuilders and we’ve looked at cable. There’s puts and takes across all the above, but we thought that Astound, and its network footprint, aligned really well with what we were looking for.” 

The sale of Astound to Stonepeak — the deal is expected to close in Q2 of next year — gave a needed lift to cable valuations overall. With a price that some analysts estimated to represent a multiple of 14.1 times 2020 forward-looking cash flow, the purchase further solidified the importance of broadband service and could help raise valuations for public cable companies.

In a research report last month, Bernstein media analyst Peter Supino pointed to the Astound deal as a benchmark for future valuations, adding that it was able to attract a hefty multiple even without the operating synergies usually inherent in such transactions. 

“Astound’s sale price appears to be highly relevant” to public cable operators like Altice USA, Charter Communications and Comcast, Supino wrote in a November note to clients, adding that applying the same multiples to the publicly traded stocks would result in increases to their share prices ranging from 32% to 91%.  

Stonepeak manages more than $29 billion of capital for investors, but its portfolio consists mainly of data centers and fiber companies, not cable or broadband service providers. Add to the fact that Astound was managed well, meaning there is little fat to cut from operations, and the sale price is even more impressive.

Holanda said the business isn’t a one-trick pony. Astound has a three-pronged growth opportunity: residential broadband; commercial services, growing at a double-digit percentage rate annually; and edging out the network to adjacent communities within its footprint. 

“Those three combined growth strategies allow us to grow our cash flow faster than most traditional cable companies,” Holanda said. “And if you add back the ability to continue to do add-on acquisitions, which we’ve had a long history of success with, we have the ability to grow this business from a whole lot of different angles. I think Stonepeak appreciated that early on.” 

Kept Executive Team Together

Another key to Patriot’s success has been its ability to retain key executives. Most of the company’s senior management and six of its eight local market leaders have been with the company for a decade or more. Having that kind of experience and expertise allows everyone to have a voice at the table, Holanda said, whether that means finance executives can talk about marketing or marketing people about network issues.

“To have that kind of group thinking leaves everyone hyper-focused on the business all the time,” Holanda said. “I think that is a tremendous key to our success. … To have that kind of leadership stability at the local level as well just gives the organization a tremendous ability to focus on what
the right long-term decisions are on behalf
of customers.” 

That continuity also was a factor for Stonepeak in its decision to pull the trigger on the Astound deal and to work with Patriot.

 “If you look at the people around Jim, it’s an absolutely fantastic team,” McMullen said. “It’s a team that has been together a long time. There’s a lot of continuity, which I think speaks to Jim’s leadership, it speaks to the culture of the business and the organization.”  

The three major publicly traded cable distribution stocks, up about 34% this year as positive sentiment around broadband growth has driven shares, could be even higher if private valuations are considered, according to a report by Bernstein media analyst Peter Supino.

The three top publicly traded cable distribution stocks -- Comcast, Charter Communications and Altice USA -- have ridden a wave of strong sentiment fueled by even stronger broadband additions. But using data from a recent private equity purchase in the sector -- Stonepeak  Infrastructure Partners $8.1 billion purchase of Astound Broadband -- Supino believes that the stocks’ prices could be between 32% and 91% higher. 

Supino estimated that Stonepeak valued Astounds at about 14.1 times the broadband company’s estimated $576 million 2020 cash flow. Considering that Astound is essentially an overbuilder in most of its markets, faces stiffer competition and has no inherent synergies with its new owner, applying that same valuation to publicly traded cable stocks would result in some serious upside. 

Astound consists of four companies -- RCN, Grande Communications, Wave Broadband and EnTouch Communications -- with about 1 million subscribers  across eight states and Washington , D.C., and has about 23,000 miles of fiber in its network. Stonepeak partnered with Patriot Media, which had been running the systems for former owner TPG for years, to continue to manage the systems. The deal is expected to close in the second quarter or 2021.

“Astound's sale price appears to be highly relevant to Altice, Charter and Comcast,” Supino wrote. “First, Stonepeak does not appear to bring material operating synergies (adjacent sales, billing systems, real estate, etc.) to the deal, so ‘the price is the price’ (notwithstanding tax assets). Second, we believe that Astound's systems are frequently third-to-market ‘overbuilders,’ which means they participate in markets which are inherently more competitive than the average of the US cable industry. Third, we do not see major fat to cut—TPG has been the owner of Astound, so we believe that the organization is efficient.” 

Applying those multiples would lift Altice USA’s stock price, ($34.07 on Dec. 1) up 91% to $65 each; Charter would rise 32% from $662.25 per share to $876.70 each and Comcast would gain 47% from $51.02 per share on Dec. 1 to $74.90 each. 

With the ink barely dry on TPG’s sale of its Astound Broadband assets to Stonepeak Infrastructure Partners for $8.1 billion, Jim Holanda, CEO of Patriot Media, the company that will manage the assets for its new private equity owners, said that future growth will be fueled by a mixture of organic opportunities and possibly new deals. 

TPG agreed to sell Astound on Nov. 1, for about $3.6 billion in cash and $4.5 billion in assumed debt. The deal is expected to close in the second quarter of next year. 

In an interview Monday, Holanda said that Astound will remain focused on several core objectives under its new owners -- growing its  residential and commercial customer base, expanding its commercial and residential networks, and accretive mergers and acquisitions when they make sense. 

“We’re happy at this size,” Holanda said. “We’re the sixth largest MSO behind Comcast and Charter and Cox and Altice and Mediacom. We’re bigger than other public cable companies like Cable One and WOW. I think we have the scale we’re very comfortable with. But if there are opportunities to grow through mergers and acquisitions or organically, we’re going to continue to pursue those, because they historically have been very accretive for us and have accelerated our growth.”

Astound Broadband has more than one million subscribers and operates under the RCN, Grande Communications, Wave Broadband and EnTouch Communications brands across seven states and Washington, D.C. Holanda has been a part of the company practically from the start. Patriot was formed in 2002 by Holanda and cable Hall of Famer Steve Simmons to buy RCN’s Princeton, N.J. assets (later sold to Comcast), managed RCN and Grande Communications for ABRY Partners beginning in 2010,  and continued that role after TPG bought RCN and Grande in 2017.  From that base TPG went on to purchase Wave Broadband in 2018 and EnTouch in September. 

In an interview, Holanda said that TPG began looking at its options for Astound earlier this year, refinancing its debt in late August to take advantage of lower interest rates. At that time, the private equity firm introduced a portability structure to the debt, which made it easier for a potential buyer to assume its leverage. 

“That woke up people to the fact that there was no financing risk in purchasing the business,” Holanda said. “Obviously we have seen lots of infrastructure players now coming into the fiber and residential broadband space.”

Holanda said he didn’t know any of Stonepeak’s partners before the deal, but its reputation in the fiber business has preceded it. Stonepeak’s portfolio includes investments in Cologix, which operates data centers in the U.S. and Canada; fiber distributed network provider ExteNet Systems; and Canadian rural broadband provider Xplornet.

“Clearly there has been a lot of activity on that side and we were hoping we would be able to find an infrastructure provider with a long term view of the business as a logical next partner in our evolution,’ Holanda said. “In the months I've gotten to know Stonepeak, we’ve been very very impressed with them. They have deep conviction in the business, a great deal of knowledge given their prior investments in infrastructure and again have a very strong balance sheet in terms of their ability to allow us to grow across all of these various disciplines.”

While it has been broadband-centric for the past five years, Holanda said Astound still has a strong video presence, dating back to the integration of streaming services like Netflix and Hulu into its offerings back in 2014.

“We also have been seeing the macro trends and shifts in the business, and as content costs continue to skyrocket out of control and impact people’s budgets, we just want to give people as much optionality as possible to put together whichever package of services they are comfortable with. Holanda said, adding that the company has its own IPTV streaming platform and is currently streaming its full lineup and VOD library to RCN customers on any device in the home. Grande customers will receive that capability in the fourth quarter, expanding to Wave customers in the first half of next year. 

About two months after it was put on the block, TPG Capital sold its Astound Broadband cable systems with more than one million customers to a joint venture between private equity firm Stonepeak Infrastructure Partners and Patriot Media in a deal valued at $8.1 billion including assumed debt.

TPG put Astound -- a combination of RCN, Wave Broadband and Grande Communications -- up for sale in September, reportedly asking about $8 billion for the assets. TPG purchased the assets in three separate deals, agreeing to pay $2.25 billion for RCN and Grande in 2016, and completing its $2.36 billion purchase of Wave in 2018. They purchased Entouch in September, adding 22,000 customers. 

According to reports, Stonepeak and Patriot are ponying up about $3.6 billion in cash for the assets and assuming $4.5 billion in debt, putting the total price tag at $8.1 billion.

Patriot Media is led by long-time cable executives Steve Simmons and Jim Holanda, and currently manages Astound. It will continue to run the properties after the deal closes, expected in the second quarter of 2021.

Astound, consisting of RCN, Grande, Wave and enTouch, is the sixth largest cable operator in the country, serving more than one million customers with 23,000 miles of fiber across Chicago, Eastern Pennsylvania, Massachusetts, New York City,  Northern California, Oregon, Texas, Washington, DC., and Washington.

“We are delighted to partner with Steve, Jim and the Astound team for the next chapter of growth. Astound is the premier operator of critical broadband infrastructure in the United States with a long history of delivering market leading customer service and network performance to communities across the country. In our increasingly connected society, we believe there is an extraordinary opportunity to deliver faster speeds and greater coverage, fundamentally enabling many aspects of everyday life,” Stonepeak partner Brian McMullen said in a press release. 

As part of the partnership with Stonepeak, Patriot Media said it will continue to invest significantly in the network and in technology.

“We have created a market leading broadband platform with national reach, broad capabilities and expertise, and exciting growth potential,” Astound CEO Holanda said in a press release. “We are very eager and excited to partner with a premier investor such as Stonepeak to further accelerate our growth and take our companies to new levels of customer satisfaction and performance. We also want to thank TPG for their great support and partnership over the past four years.”

Simmons formed Patriot Media in 2002 after buying RCN’s Princeton, N.J., systems with private equity company Spectrum Equity Associates. He grew the operator to about 350,000 subscribers before selling it to Comcast for $483 million in 2007. Three years later Simmons and Patriot took over management of RCN and Grande, after they were purchased by Abry Partners, staying on in that role when Abry sold the properties to TPG in 2017.

“As we continue to grow our platform, our core objectives remain the same: to deliver exceptional service to our customers and communities, a best-in-class experience for our employees, and outstanding results for our investors,” Simmons said in a press release. “Our mission and management vision are aligned with Stonepeak and we very much look forward to our partnership with them.”

BofA Securities and Lazard  are acting as financial advisors to Stonepeak, and Simpson Thacher & Bartlett LLP is serving as legal counsel. J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC are acting as financial advisors to Astound, and Cleary Gottlieb Steen & Hamilton, LLP and Seyfarth Shaw, LLP are serving as legal counsel.

“We’ve had a long-held theme and belief in the growing value of broadband infrastructure, culminating in our successful investment in Astound Broadband, in partnership with Patriot Media,” said David Trujillo, partner at TPG. “We’re proud to have been part of the company’s journey, which has been characterized by significant platform expansion, strong growth and great leadership. We wish Steve, Jim and the outstanding Patriot management team well, as they continue to grow Astound in partnership with Stonepeak.”

TiVo has announced the first major operator deal for its new TiVo Stream 4K OTT device, with TPG Capital-owned cable operators RCN, Grande and Wave set to bundle the Android TV-powered HDMI dongle with their high-speed internet service. 

Any customer who subscribes to RCN, Grande or Wave high speed internet service of 100 Mbps or higher can add a TiVo Stream 4K device free alongside free access for one year to TiVo’s new streaming service, TiVo Plus.

Debuting in late-April, and currently priced at $49.99, the TiVo Stream 4K stacks TiVo’s proprietary search-and-recommendation software over an Android TV-based operating system. It provides native integration of Netflix, Amazon Prime Video and Disney Plus, as well as access to any app in the Google Play Store. 

Notably, in their marketing, the TPG cable triumvirate is emphasizing the Stream 4K’s native integration of virtual pay TV service Sling TV and local broadcast station streaming service Locast, of the latter of which the trio says “mimics the look and feel of traditional cable.”

The three cable companies currently offer traditional cable TV service, leveraging Evolution Digital's eStream 4K set-tops running Android TV with the TiVo user experience. They’ll now feature the Stream 4K device as an option to internet customers who don’t want the eStream thin-client pay TV service. 

RCN serves customers across areas of Massachusetts, Chicago, Pennsylvania, New York City, and Washington, DC.; Grande Communications’ footprint is in Texas; while Wave Broadband serves customers in Washington, Oregon and California.

“As a provider committed to bringing customers unique, affordable options, we continue to partner with brands such as TiVo and Sling TV to offer customers ultimate choice and control,” said Chris Fenger, COO of RCN, Grande and Wave, in a statement. “With the TiVo Stream 4K, internet-only customers can connect our award-winning internet service to a compact and powerful device to create an entirely customizable entertainment experience with access to live TV, streaming services and free TiVo content in one place.”

Private equity firm TPG said it has completed the purchase of Houston-area broadband and video service provider EnTouch. Terms of the deal were not disclosed.

TPG said EnTouch will join its other pay TV and broadband services -- RCN, Grande Communications and Wave, collectively known as Astound --  which combined have more than 1 million customers. 

The deal was first announced in February.  

“With the acquisition of EnTouch, the company will be joining the Grande Communications eco-system, which also includes RCN and Wave Broadband, allowing customers to take advantage of Grande’s higher internet speeds and streaming services,” said RCN, Grande and Wave CEO Jim Holanda in a press release. “The addition of EnTouch creates further opportunities for sustained growth in our Texas service area and continues the expansion of our reliable, robust fiber-rich network on a national scale for both residential and business customers.”

According to TPG, the addition of EnTouch expands its existing Texas presence to servicing both residential and business customers in Dallas, Austin, San Antonio, Corpus Christi, Waco, Temple, San Marcos and Midland/Odessa.

“As part of Grande Communications’ service network, we will continue to focus on providing customers with high-quality technology and customer service,” said Sam Luxton, President and CEO of EnTouch. “Together, we will offer new and improved products and services and continue to grow and innovate.”

The news comes as TPG is reportedly seeking out a buyer for its pay TV properties, valuing them at about $8 billion. 

Private equity firm TPG has hired investment bankers Morgan Stanley and JP Morgan Chase to shop its overbuilder unit Astound, which includes its interests in RCN, Grande Communications and Wave Broadband, according to reports.

Reuters said Monday night that TPG hired the bankers and was looking at a valuation of the overbuilder that would top $8 billion, including debt.

TPG pieced together Astound through a pair of acquisitions over the past four years. It purchased RCN and Grande Communications in 2016 for $2.25 billion and Wave in 2018 for $2.36 billion.  All together, the properties offer pay TV, broadband and telephone service in eight states to about 1 million customers.

TPG declined comment.

The news comes as AT&T is attempting to sell a majority interest in its DirecTV satellite unit and other traditional operators are making moves to expand their broadband reach into more rural areas. 

Broadband growth has been especially robust in the COVID-19 era, and smaller operators may want to capitalize on that growth. But finding a buyer with the required financial muscle to wrestle a deal of this size could be tricky. Because many of its properties are overbuilds of incumbent providers, that would mean operators that have systems nearby like Charter, Comcast and others, would be prohibited by federal regulations from doing a deal. And while Cable One has purchased smaller operators in the past like NewWave Communications, Fidelity Communications, Clearwave  and ValueNet, this deal could be a little price for its tastes. 

Still, broadband growth has been strong and has shown little signs of slowing down. According to Leichtman Research Group, cable operators added about 1.4 million broadband customers in Q2, up from 530,000 additions in Q2 2019. 

Wave Broadband said it has split its business operations into two regionally-focused operations -- Wave North and Wave South -- effective immediately.

Wave North will serve the company’s business and residential customers in Washington State, while Wave South will focus on business and residential customers in Northern California and Oregon. Both entities will continue to serve customers under the Wave Broadband brand.

The company said it has signed leases for two facilities to support its Wave North regional operations -- a  45,600-square-foot building in Bothell, Washington, which will become operational in the early summer of 2019, and a 31,600-square-foot facility located south of downtown Seattle. Wave expects to be operational at the Seattle location by the Fall of 2019. These new facilities replace Wave’s previous plans to move its headquarters into the Kirkland Urban development and are a direct result of Wave’s desire to decentralize its operations to better serve its customers.

Wave South’s operations center will continue to be based in the company’s existing Rocklin, California facilities.

The moves come more than a year after Wave was purchased by TPG Capital for about $2.36 billion, combining it with two earlier purchases -- RCN and Grande Communications.

In addition, former AXS TV and Charter Communications executive Fred Lutz and former Suddenlink Communications SVP Jared Sonne have joined Wave North and Wave South, respectively, both as general manager and senior vice presidents. Each organization will continue to operate as part of the national consortium with RCN and Grande Communications that comprises the sixth largest US cable and broadband services provider.

“Fred Lutz and Jared Sonne bring exceptional industry and leadership experience and are building localized operations to advance the superior customer service, reliable communication services, and strong overall value that our business and residential customers have come to expect,” RCN, Grande and Wave chief operating officer Chris Fenger said in a press release. “The establishment of Wave North and Wave South enables us to make business decisions closer to our customers and employees while we continue to invest in our network, enhance our products and services, and capitalize on future growth opportunities.”

No immediate changes are planned to Wave’s products, services, or pricing, the company said. 

Less than a year after it joined RCN, Grande Communications and Wave Broadband, TPG Capital said the combined entities have made some key executive appointments, naming Patrick Knorr chief commercial officer and EVP of commercial services and Paul Koss as SVP of carrier and wholesale.

TPG purchased RCH and Grande in 2016 for $2.25 billion, and snapped up Wave in January for $2.36 billion. The combined companies cover nearly 20 metro areas in 11 states including California, Illinois, Maryland, Massachusetts, New Jersey, New York, Oregon, Pennsylvania, Texas, Virginia, Washington, and Washington, D.C.

Knorr had been EVP of business solutions for Wave Broadband. A long-time cable executive, Knorr had been general manager of small cable operator Sunflower Broadband before joining Wave in 2012. 

“Commercial services is our fastest-growing segment and Patrick’s appointment underscores our combined commitment to ensuring that businesses nationwide have the most robust fiber network and services available, so that they can continue to grow and take advantage of future technologies,” said Jim Holanda, CEO of RCN, Grande and Wave, in a statement.

In his new role, Koss will be in charge of growing the company’s carrier and wholesale business, including cellular backhaul.

“At a time when innovation in technology is thriving, the security and reliability of fiber connectivity has become fundamental to economic growth for enterprises of all sizes,” Knorr said in a statement. “As an organization, we are committed to making fiber infrastructure more accessible and affordable to support today’s technological marketplace.”

TPG Capital has completed its previously announced purchase of Wave Broadband, a $2.36 billion deal that creates the sixth largest cable operator in the country.

TPG, which also owns RCN and Grande Communications, first announced the Wave deal in May.

“By combining RCN/Grande and Wave, we are creating a leading, national-scale internet provider and cable TV operator with significant growth potential,” RCN/Grande CEO Jim Holanda said in a statement. “We are pleased to announce the close of this transaction, and look forward to our continued growth led by a strong focus on customer service and commitment to providing the highest quality high-speed internet, TV, and voice services available.”  

The combined companies have a presence in seven of the top 10 DMAs and have nearly 950,000 voice, video and data subscribers.

Wave will continue to operate as a branded entity headquartered in Kirkland, Wash., serving business and residential customers in Washington, Oregon, and California. RCN provides similar services as Wave along the East Coast and in Chicago; Grande operates throughout Texas.

“Together, RCN/Grande and Wave create a market-leading broadband platform with national reach,” said TPG partner David Trujillo in a statement. “The combined platform is providing businesses and residents across the country with fast, high-quality, and reliable communications services that allow them to rapidly access the content they crave. We look forward to our continued work with the RCN/Grande and Wave teams.”

Grande Communications said it has launched 1 Gbps broadband in San Antonio, a debut that wraps up the operator’s deployment of gigabit services in the operator’s Texas-area footprint. 

Grande said the latest deployment utilizes DOCSIS 3.1 technology on its HFC plant in San Antonio, complementing 1-Gig service it also offers there on its FTTH network.

Grande said residential pricing for 1-Gbps service starts at $69.99 per month. In addition to San Antonio, Grande also serves Austin, Dallas, San Marcos, Waco, Temple, Corpus Christi, Midland and Odessa.

TPG Capital has agreed to purchase Seattle-based Wave Broadband in a deal valued at about $2.36 billion.

News that a deal was close was first reported by Reuters.

TPG has been on an acquisitions tear of late. In August it paid $2.25 billion for Grande Communications and RCN. 

Wave’s owners Oak Hill Capital Partners and GI Partners had hired investment bankers in April to seek out a buyer for the company. At the time they were reportedly seeking $2 billion.

Wave has about 138,000 video customers in Washington State and Oregon – including Seattle and Portland – and overbuilds Comcast in parts of San Francisco. The company has concentrated on its broadband service and has recently focused on purchasing fiber and data companies to boost its high-speed data presence, including Seattle-based CascadeLink.

In September the company raised about $125 million to continue an ambitious fiber buildout geared toward serving enterprise customers. 

Oak Hill and GI Partners teamed up with Wave management – including founder and CEO Steve Weed – to buyout long time backer Sandler Capital Management in 2012 in a deal some valued at about $950 million.

Wave said the new deal will create the sixth largest internet and cable operator in the country. The transaction is expected to close in the fourth quarter of 2017. Wave will be combined with TPGs’ RCN operations, according to the announcement.

“Over the last several years we have accelerated our growth substantially by expanding from our heritage of residential broadband services into enterprise grade fiber,” said Wave founder and CEO Steve Weed in a statement. “We are excited that our new partners in TPG and RCN recognize the value of what we have created, and share our passion for creating happy customers – we are eager to enter our next era of growth alongside them.”

Wave will continue to operate as a branded entity headquartered in Kirkland, Wash., serving business and residential customers in Washington, Oregon, and California. RCN provides similar services as Wave along the East Coast and in Chicago; Grande operates throughout Texas.

The company said it will continue to grow its residential customer base while also accelerating expansion of its fast-growing commercial and enterprise business segments that have driven much of its recent momentum.

“At RCN and Grande, we pride ourselves on providing the best products, best service, and best value to our customers. Through our partnership with TPG, and by expanding our footprint with Wave, we are creating a market-leading broadband platform with national reach, broad capabilities and expertise, and exciting growth potential,” said RCN and Grande CEO Jim Holanda in a statement. “We’ve known the team at Wave for many years, and their focus on delivering value to their customers aligns perfectly with ours.”

Wave management will remain significant investors, partnering with majority owner TPG. Wave’s CEO, Steve Weed, will join the combined company’s Board of Directors.

Music Choice is targeting IP-connected boxes with a new, streaming version of its service that will initially be available on TiVo-powered boxes from RCN and Grande Communications.

That new offering, called New Music Choice, enables viewers to access VOD fare from Music Choice via the set-top’s interface.  Music Choice said the next-gen version offers 75 commercial-free audio channels and 25 video channels with access to 20,000-plus music videos.  

RCN customers with TiVo set-top boxes will have access to the New Music Choice via channel 851 or 1900 in Lehigh Valley, Pa.; and on channel 752 for Grande customers. It’s also accessible via TiVo Central.

Music Choice also offers an authenticated TV Everywhere app on iOS and Android devices, as well as Web browsers.

TPG Capital’s surprise $2.25 billion purchase of over-builder RCN and small Texas-based cable operator Grande Communications could signal a new wave in the cable M&A space: new entrants that are laser-focused on broadband and the potential to offer over-the-top and short-form video services, rather than stodgy old pay TV.

TPG, which is paying $1.6 billion for RCN and about $650 million for Grande, is teaming up with Google Capital, the investment arm of the Internet search conglomerate, on the deal. It’s expected to close in the first quarter of 2017.

Google Capital is taking a minority financial interest in the deal, but at least initially there is no mechanism for the company to increase that stake.

The relatively high price surprised some members of the financial community: At 8.4 times cash flow for RCN and 8.6 times for Grande, the deal is valued nearly on par with the Charter Communications’s $78.7 billion buy of Time Warner Cable and Bright House Networks (9.1 times). It seems to place a premium on pay TV providers for their broadband infrastructure, rather than their video businesses.

As TPG Capital partner David Trujillo noted in announcing the deal: “High-speed data has become, and will remain, the essential connection for both consumers and businesses.”

That mindset is not new, and operators such as Cable One and Wave Broadband have been de-emphasizing video for years. But it could bode well for smaller operators that have been forced to concentrate on high-speed data as programming costs have skyrocketed.

“This is likely the beginning of a mini-boom,” said Garrett Baker, founder of Garrett M. Baker Advisors, LLC, who has advised on dozens of large and small cable deals over the years. “Many private operators are finally deciding, ‘This is my big chance to get out.’ ”

RCN and Grande are in similar straits as the rest of the industry: They’re watching their video customer base decline as younger viewers migrate to over-the-top services and skinny bundles for their entertainment needs. Like many other operators, both have put a greater emphasis on their broadband business, providing the pipe for those smaller content packages.

While Grande has had a higher profile — it has moved to launch 1 Gigabit-per-second service in Austin, Dallas and San Antonio, Texas, three markets where Google Fiber has expressed interest — RCN has maintained its broadband presence, offering services ranging from 10 Megabits per second to 330 Mbps in its markets.

While RCN has basically been managed for cash flow since Abry purchased it in 2010 and was not initially marketed with Grande for sale, it has been growing broadband customers organically and was the property that drew TPG’s interest.

“Grande is a little too small to build a platform asset,” said one source in the cable community familiar with the company.

TPG is expected to continue to test the deal waters after it closes the RCN-Grande deal, sources familiar with the company said this transaction will do for the time being.

“I’m sure they’d love to do more,” said one source in the cable financial community. “But this deal can stand on its own.”

It's official: Private equity fund TPG Capital announced Monday it will buy RCN Telecommunications and Grande Communications for $2.25 billion.

TPG is acquiring them via separate transactions – from ABRY Partners for $1.6 billion and $640 million, respectively, and plans to combine those assets to create a top ten U.S. cable operator.

Additionally, TPG said it’s partnering with Patriot Media, a management team headed by Steve Simmons and Jim Holanda that have managed RCN and Grande since 2013.

Under that partnership, Patriot Media “will continue to make significant investments in the network and in technology that will enable RCN and Grande to expand Gigabit per second high-speed data services, creating the premier internet experience in their markets,” they said. 

TPG said the deal expands on its strategy of identifying and partnering with companies at the forefront of thriving and evolving industries, citing investments in sports and entertainment intermediary CAA; Cirque du Soleil; online education platform Lynda.com; Spotify; Univision; Airbnb, Ipsy, RentPath, and Uber.

TPG and ABRY expect to close the deal in Q1 2017.

The Wall Street Journal reported that the deal would be announced as soon as Monday.

RCN and Grande, operators that have both leaned on TiVo-powered video platforms, together serve Austin, Texas; Boston; Chicago; Dallas; Lehigh Valley and other areas of Pennsylvania; New York; San Antonio; and Washington, DC.

TPG was advised on the deal by PJT Partners, UBS, Cleary Gottlieb, and Deloitte. ABRY, Patriot Media, RCN, and Grande were advised by Credit Suisse, Kirkland & Ellis, Locke Lord and PwC.

Update: “We believe that Grande has been on the market for some time, and that as part of the process TPG convinced Abry to sell RCN as well, JP Morgan’s Philip Cusuick and Eric Pan said in a note issued Monday, citing SNL Kagan data that RCN has about 289,000 video subs, alongside Grande’s 88,000.

They said the sale price of $2.25 billion compares to the 2015 EBITDA of $192 million at RCN and $76 million at Grande, and believe that the deal is about 8.25x TTM EBITDA.

“While this is substantially lower than the 8.8x EBITDA that Altice paid for Cablevision or 9.1x that Charter paid for TWC, RCN is also a cable overbuilder so likely has fewer potential buyers,” they said, adding that they don’t believe TPG expects much  by way of synergies in the deal. 

“Given RCN’s presence in the New York area and Grande’s in Texas we would expect that Altice/Cablevision (New York overlap) and Charter (New York and Texas overlap) were not likely to be bidders,” they added. 

Private equity firm TPG is reportedly close to a deal to purchase RCN and Grande Communications in a deal worth $2.25 billion.

According to a report in the Wall Street Journal, a deal could be announced Monday.

The Journal said that in addition to TPG, which owns other digital media investments like Univision Communications, Spotify and STX Entertainment, Google Capital, the investment arm of Alphabet Inc. is taking a minority stake in the deal.

Overbuilder RCN was sold to Abry Partners in 2010 for about $1.2 billion. RCN has about 289,000 customers in parts of Boston, Chicago, Lehigh Valley (PA), New York City, Philadelphia (Delaware County) and Washington, DC. Grande Communications was launched about a decade ago and has recently concentrated on its high-speed Internet business, and has made moves to deploy 1-Gigabit service in some of its markets. According to its web site, Grande serves more than 160,000 customers in larges and small communities in Texas, including Dallas, San Antonio and Austin.

Google Fiber is considering Dallas as an expansion city for its 1-Gig broadband and pay TV services, possibly setting the stage for more competition there with Charter Communications, Grande Communications and AT&T.  

Google Fiber, which offers service in parts of Austin and has a buildout underway in San Antonio, has not made a firm commitment to deploy in Big D, but said it’s begun a joint planning process with the city, similar to the process it started last year with Chicago and Los Angeles.

“Bringing Google Fiber to Dallas would be a huge undertaking, so we want to make sure we’re prepared," Jill Szuchmacher, Google Fiber’s director of expansion, noted in this blog post. “Google Fiber Working alongside Mayor Mike Rawlings and local leaders, we’ll use our Fiber checklist to learn more about local topography, existing infrastructure, and other factors that may impact construction. Building a fiber optic network through a dense and complex urban environment like Dallas is challenging—these discussions will help us deploy our network efficiently and responsibly.”

In Dallas, Google will face off with Charter (via its acquisition of Time Warner Cable, which started its all-digital “Maxx” upgrades there back in 2015, and AT&T, which launched its fiber-based GigaPower service to parts of Dallas/Ft. Worth in 2014; and Grande Communications, which has also been pushing 1-Gig into several of its markets.

Google Fiber has also launched service in Nashville, Tenn.; Atlanta; Kansas City; and Provo, Utah; and has committed to deploy in Salt Lake City; San Antonio; and Charlotte and Raleigh-Durham, N.C.

In addition to Los Angeles, Chicago and Dallas, Google Fiber is also mulling expansions in Portland, Ore.; San Jose, Irvine and San Diego, Calif.; Phoenix; Oklahoma City; Louisville, Ky.; and Jacksonville and Tampa, Fla.

RCN and Grande Communications are the latest U.S. MVPDs to offer access to Hulu’s SVOD service on the set-top box.

RCN and Grande are offering Hulu as a “channel” on leased set-tops that run TiVo’s software, search and interface, a move that follows earlier integrations with other OTT services such as Netflix, YouTube and HBO Go, the premium programmer’s authenticated TV Everywhere app.

Hulu can be found on channel 398 for Grande customers and on channel 449 for RCN subs in Boston; Chicago; New York City; Philadelphia; and Washington, D.C.; and channel 749 for RCN customers in Lehigh Valley, Pa.

"In the last year alone, we've seen a 23 percent increase in activation of streaming services such as Netflix, HBO GO and YouTube through our TiVo set-top boxes and that number continues to rise," said Chris Fenger, COO of RCN and Grande, in a statement. "On average customers consume 15 – 17 hours of content on just one of these services. These rising numbers consistently remind us that integrating popular streaming services into our suite of products allows instant access, convenience through one device, and a superior customer experience. We will continue to innovate in this arena to deliver what our customers want most."

Suddenlink, GCI and Cablevision Systems have also integrated Hulu. Suddenlink and GCI are also offering it on its TiVo-based platform, Cablevision Systems is enabling it with ActiveVideo’s CloudTV StreamCast, a technology that converts user interfaces, video and other content from Web formats to formats that can be rendered and displayed by non-IP or incompatible IP set-tops.

Notably, content from CW and Univision isn’t available on those integration due to streaming right limitations on certain devices.  However, those customers who sign on for Hulu can still access content from those programmers through other Hulu-supported platforms.

Hulu has also announced integrated distribution deals with AT&T, Armstrong, Atlantic Broadband, Mediacom Communications, Midcontinent Communications and WideOpenWest (WOW!), which this week announced that it is rolling out eBOX, a hybrid QAM/IP box from Evolution Digital that runs the TiVo platform and will also support a selection of OTT video services and apps.

Hulu is also developing an OTT-TV skinny-bundle service that would presumably compete with some of its new MVPD partners.

Grande Communications has joined RCN among MVPDs that have extended access to the HBO Go app on set-tops/DVRs powered by TiVo.

Currently, Grande customers on the TiVo platform who are also HBO subs can access the app via the Movies & Grande VOD selection from the TiVo Central page. Per this FAQ, Grande plans to add a “channel” on the guide that will tune customers directly to the app in the next 30 to 60 days.

Grande offers services in several Texas cities, including Austin, Corpus Christi, Dallas, Midland, Odessa, San Antonio, San Marcos and Waco.

The launches follow TiVo’s recent announcement that it had begun to offer HBO Go on its  TiVo Bolt, Roamio and Premiere retail product line, and that it would also extend support for the app on select TiVo devices that are distributed by its MVPD partners. Other TiVo U.S. MVPD partners include Buckeye CableSystem, Atlantic Broadband, Midco, Armstrong, GCI, Suddenlink Communications (now part of Altice Group), and Mediacom Communications, among others.

Timed to see the Houston Astros and the Texas Rangers compete in the 2015 pennant race, Grande Communications, the Texas-based broadband and TV provider, has launched MLB Network and the MLB Network Strike Zone look-in channel, on the Ultra Sports Tier package. MLB Network is on on HD channel 922 and SD channel 133. MLB Network Strike Zone is on channel 923.

“We are thrilled to bring MLB Network and MLB Network Strike Zone to Grande customers, especially as the Houston Astros and Texas Rangers compete in the 2015 pennant races,” Rob McGlarry, president of MLB Network, said in a release. “This partnership is in line with our goal to make MLB Network available as widely as possible, and Grande customers will now have the opportunity to receive the only network on television committed to covering baseball 24 hours a day, 365 days a year.”

“Grande is dedicated to providing customers with an extensive lineup of sports coverage. We are excited to deliver more Major League Baseball as part of our ongoing effort to enhance our customers’ experience,” Matt Rohre, senior vice president of operations and general manager of Grande Communications, said in the release. “This new channel carriage is a direct result of customer requests, especially as the season comes to the exciting finish, with playoffs around the corner.”

MLB Network launched in January 2009 in 50 million homes and is currently distributed in approximately 70 million homes throughout the U.S., Canada and Puerto Rico.

Grande operates in Austin, San Antonio, Dallas, San Marcos, Waco, Temple, Corpus Christi, Midland and Odessa. 

Synacor said it has struck an expanded multiyear pact with  Texas-based Grande Communications that factors in a next-gen portal, Synacor’s Cloud ID TV Everywhere authentication systems, and the vendors multiscreen search and discovery metadata platform.

Financial terms were not announced, but Grande customers in markets such as Austin, Corpus Christi, Dallas, Midland, Odessa, San Antonio, San Marcos and Waco, will get a newly-redesigned user interface via the Web and access to other components that are baked into the deal.

Synacor, which recently put up $24.5 million to buy email and messaging specialist Zimbra, also works with Mediacom Communications, BendBroadband (now part of TDS Telecom), Google Fiber, CenturyLink, Cable One, Charter Communications , Suddenlink Communications, WideOpenWest, Surewest Communications, Verizon Communications, and Sling TV, among others.

“Like the Texans we serve, we're proud of our independent, 'can-do' attitude that has enabled us to serve over 140,000 customers in communities big and small across Texas,” said Peter Drozdoff, vice president of marketing at Grande, in a statement.  “We are committed to providing superior customer service and as part of our ongoing evolution, we are proud to offer Synacor’s innovative solutions to give our customers the latest technological advancements available to access to their favorite content from any device of their choosing.”

“We’re delighted to extend and expand our longstanding partnership with Grande Communications,” added George Chamoun, president, sales & marketing, service providers, at Synacor. “Grande puts the utmost importance on serving their customers. Together, our teams are delivering on the promise of superior digital services, choice and flexibility by ensuring Grande subscribers have easy login experiences and easy access to all their favorite content, no matter the device.”

Grande Communications will be first out of the chute with a 1-Gig residential broadband service in San Antonio, announcing that it will launch the service in select areas of the city on March 3 for $64.99 per month.

Grande, which announced the launch date on the same day the FCC voted in rules that will reclassify broadband under Title II, is launching 1-Gig ahead of AT&T, which has added San Antonio to the list of cities that will get GigaPower, the telco’s fiber-based, Gigabit platform, but has not yet launched it in that market. Google Fiber, which has been selling a standalone 1-Gig service for $70 per month, is still considering expanding into San Antonio, but did not include the city on its recently announced list of expansion markets.

Time Warner Cable, San Antonio’s incumbent MSO, recently kicked off “TWC Maxx” upgrades there that will bump its Ultimate tier from 50 Mbps (downstream) to 300 Mbps while also boosting other broadband tiers at no additional cost.

Grande said it will initially offer its 1 Gbps service, called Power 1000, to two parts of San Antonio – Alamo Heights and Terrell Hills.

Also on March 3, Grande is launching a set of faster broadband plans in all its markets -- 200 Mbps ($44.99), 300 Mbps ($54.99) and 400 Mbps, which will sell for $64.99 per month in areas where the ISP has not yet introduced 1-Gig service.  Grande launched Power 1000 in parts of Austin, Texas, about a year ago. 

Other Grande plans offer speeds of 15 Mbps ($29.99) and 50 Mbps ($34.99).

Grande's broadband tiers can also be bundled with its TV and phone services.

“Grande’s deployment of 1G service in San Antonio along with the new Internet speeds are part of our customer care commitment and continuing effort to offer the fastest Internet speeds and loaded bundles at the best value,” said Matt Rohre, senior vice president of operations and general manager for Grande, in  a statement. 

Google Fiber on Monday kicked off signups for select areas of Austin, Texas, an announcement that comes about a week after the company announced its pricing plans for the region.

Google Fiber, which unveiled plans to build its 1-Gig network in Austin in April of 2013, announced on its blog today (Dec. 1) that it is starting the sign-up process for prospective residential and small business customers in so-called “fiberhoods” in the south and southeast areas of the city. 

Similar to the process it originally launched in the Kansas City area, Google Fiber is using a demand-based process to determine which fiberhoods in Austin will actually get service. As such, only those that meet their preregistration signup goals will qualify to get service from Google Fiber. 

Google Fiber has already set signup deadlines for its initial deployment wave. The deadline for the first area, Bluebonnet, is January 29, 2015, to be followed by Lady Bird Lake (March 12); Emerald Forest (April 23); Ben White (June 4); and Onion Creek (July 16). Other portions of Austin are in Google Fiber’s “planned” region.

At least one part of Bluebonnet (Bluebonnet 31) has already reached its signup goal, and several more are closing in. At last check, Bluebonnet 21, for example, needed only six more signups, while Bluebonnet 24 needed eight more.

Google Fiber also announced Monday that it is opening its Fiber Space in downtown Austin, where prospective customers can take 1-Gig for a spin. 

Google said last week that it would offer three service plans in Austin – a standalone 1-Gig service for $70 per month; a Gigabit/TV bundle starting at $130 per month, and a free “basic” Internet service (5 Mbps down by 1 Mbps) up, so long as customers spring for the $300 construction fee. Its 1-Gig service for small businesses, offered through a recently announced Early Access Program, fetches $100 per month.

As it builds out its network in Austin, Google Fiber will face off with Grande Communications, which launched 1-Gig in Austin in February and recently moved ahead on an expansion; and AT&T, which is selling a 1-Gig “GigaPower” service in pockets of Austin. Time Warner Cable, Austin's incumbent cable operator, recently completed an upgrade in Austin that bumps its former 50 Mbps (downstream) DOCSIS 3.0 tier to 100 Mbps.

Google Fiber also has services launched in parts of Kansas City and Provo, Utah, and is also exploring expansions to another nine metro markets and up to 34 cities. Google Fiber is expected to announce its expansion picks before the end of 2014.

Grande Communications said it is expanding the reach of its fiber-fed 1-Gig broadband service to new and existing customers in the West Campus area of Austin, Texas.

That will mark the third gigabit expansion site for the company, which has ongoing deployments in Buda and West Austin. Grande is expanding its reach with 1-Gig as speed competitoin in Austin continues to heat up. Google Fiber has construction underway for its 1-Gig-capable network in Austin, with service sign-ups slated to start next month.  as does AT&T, which is targeting parts of Austin with its fiber-based “GigaPower” network.

Time Warner Cable, Austin's incumbent cable operator, recently completed a broadband upgrade across the city that includes a new 300 Mbps (downstream) DOCSIS 3.0-powered service that replaces its former 50-Meg offering.

Grande launched its consumption cap- and contract-free 1-Gig service in the Austin area in February, selling the “Power 1000” tier for $64.99 per month. In Austin, AT&T sells GigaPower for $70 per month under a “Premier” plan under which customers must agree to participate in AT&T Internet Preferences, a targeted Web advertising program; and for $99 per month under its “Standard” offering.

“Grande’s plan is to expand 1G service to areas where there is clearly high demand. West Campus is adjacent to the University of Texas, so there is a high density of college students in the area,” said Grande SVP of operations and GM Matt Rohre, in a statement. “ Austinites are hungry for fast speeds and we are evaluating the options to broaden our 1G coverage area in 2015.”

The top five cable overbuilders have been growing video and broadband customers at a healthy clip over the past five years and could play a key role in the expected upcoming wave of consolidation, according to research by SNL Kagan.

Video subscribers at the top five overbuilders — WideOpen- West, RCN, Wave Broadband, Grande Communications and Click! Networks — have risen by about 25% since 2009, while broadband subscribers have grown at more than three times that rate, according to Kagan.

“Given cable M&A’s lofty valuations in 2014, magnified by the consolidation atmosphere surrounding the industry, overbuilders could play a key role in the M&A market going forward, either as buyers or targets,” Kagan said.

While much of the video-subscriber growth was due to acquisitions — WOW had the greatest increase in video customers (73%) during the period and was the most aggressive buyer of systems — other overbuilders have seen broadband growth outpace video customer declines.

For example, the next largest overbuilder, RCN, has seen video customers decline by about 15% since 2009, while broadband customers have risen by 26% since then.

STRONG SURVIVORS

Overbuilders burst onto the video scene in a big way in the 1990s, as new regulation (the Telecommunications Act of 1996) and easy financing encouraged competition. While some fell on financial hardship after they couldn’t compete with incumbents, a handful survived and some have even managed to crack the top 10 among video distribution companies.

Today, according to Kagan, overbuilders represent about 1.26 million video subscribers across the country, or about 1% of the nation’s roughly 100 million TV households and 1.5 million broadband customers.

Waller Capital president Garrett Baker, who helped sell four of the top overbuilders — WOW, RCN, Wave Broadband and Grande — to their current owners, said the success of companies in the deal market is causing others to look toward nontraditional targets: “The overbuilders’ operating success has put them in a position to look outside their current footprints. That is likely to continue.”

A SHOT IN THE ARM

The cable deal market, stagnant for years after a big consolidation wave in the late 1990s and early 2000s, got a shot in the arm last year when Comcast agreed to purchase Time Warner Cable in a deal valued at about $69 billion in stock and assumed debt. As part of that deal — which is currently undergoing regulatory approval — Comcast and Time Warner Cable agreed to sell, swap and spin off about 6 million customers in a series of deals with Charter Communications.

When the smoke clears, expected early next year after the Comcast-TWC deal is closed, Charter will have doubled its owned-andmanaged customer base, and the combined Comcast-TWC will have about 30 million subscribers across the country, including 19 of the top 20 television markets.

Charter, which touched off the consolidation frenzy with its pursuit of TWC last year, isn’t expected to stop there. Both Charter CEO Tom Rutledge and one of the cable operator’s largest shareholders, John Malone’s Liberty Media, have said Charter — and GreatLand Connections, the publicly traded company that will hold the spun-off Comcast-TWC assets (and be 33% owned by Charter) — could serve as vehicles to further consolidate the industry.

Whether overbuilders like WideOpen-West, which was founded in 1999 and is backed by private-equity giant Avista Capital Partners, will be a target or a competitor for cable assets remains to be seen. But WOW, which has about 699,000 video customers and 770,000 broadband subscribers in seven states (Alabama, Georgia, Florida, Michigan, Ohio, South Carolina and Tennessee), has proven it has the stomach for acquisitions.

WOW’s first big purchase was in November 2001, about seven months after it opened for business, when it bought telco Ameritech’s Americast systems in Illinois and Indiana. WOW has done several deals since then, ranging from the $55 million purchase of bankrupt Broadstripe Communications’ 31,000 customers in 2011 to the $1.5 billion purchase of Georgia- based Knology’s 257,000 customers in 2012.

RCN, which was bought out by private-equity group ABRY Partners in 2010 for about $1.2 billion, has kept a low profile since then and has been more of a seller of systems than a buyer in its most recent deals. But RCN — the first overbuilder in the country, formed in 1993 — has a long history of aggressive deal-making.

Overbuilders could target each other for M&As, Pivotal Research Group principal and senior media & communications analyst Jeff Wlodarczak said, but if they want to compete for cable assets with the likes of Charter, they’ll likely lose unless they want to “dramatically overpay.”

Google Fiber’s buildout in Austin, Texas, is underway, though it appears that the provider of broadband and video services will miss its original plan to start connecting homes in the speed-crazed region by mid-2014.

But it apparently won’t miss by much.

“Construction is underway, and we plan to open sign-ups and start hooking up our first Austin customers later this year,” Google Fiber spokeswoman Jenna Wandres said via email.

Google Fiber announced Austin as a buildout site last April, estimating at the time that it would start to connect homes there by mid-2014.

For now, Google Fiber isn’t revealing which parts of the city it is wiring up first, though theAustin-American Statesmanreported this week that south and east Austin are among those being targeted first, citing data culled from its review of hundreds of city-issued permits showing where Google Fiber has begun to install conduit.

And that initial work apparently scratches the surface on what’s in store. Wandres told the paper that it will take thousands of permits to complete its work within the Austin city limits.

“It’s a big construction project, so it takes a whole lot of time to plan for,” she added, according to the report. “We’re working as quickly as we can to get Fiber to Austin residents soon, and we hope to have more information to share soon. It’s a lot of work, and we want to make sure we are doing it right.”

Google Fiber also has not announced when it will begin its sign-up process in Austin. As it’s done in Kansas City and more recently in Provo, Utah, Google Fiber will use a demand-based process to determine which “fiberhoods” will get services first.

In the meantime, Grande Communications has already begun to offer 1-Gig services to select areas of Austin, and incumbent telco AT&T has been rolling out “U-verse with GigaPower,” a fiber-based service that is starting off at 300 Mbps, but will later ramp up to handle 1 Gbps. Time Warner Cable, which is in the process of being acquired by Comcast, has kicked off upgrades in Austin that will enable the operator to deliver 300 Mbps speeds via its DOCSIS 3.0 network, flanked by an expansion of quasi-public WiFi hotspots.

Google Fiber has also announced that it is exploring expansions in an additional nine metro markets and up to 34 cities, with expectations that it will announce selections later this year.

Grande Communications announced Wednesday that it had enabled Netflix streaming on TiVo-powered devices that it leases to customers across its Texas-area systems.

Grande Communications is one of three U.S. TiVo pay-TV partners that have integrated the Netflix streaming video service into leased TiVo boxes. The other two are Atlantic Broadband and Grande corporate cousin RCN.  Two operators across the pond – Virgin Media in the U.K., Com Hem in Sweden – have also enabled Netflix on leased TiVo-powered boxes, as has Danish operator Waoo!, which offers Netflix on set-tops made by AirTies that run middleware from Nordija. Google Fiber, which currently offers broadband and pay TV services in parts of Kansas City and Provo, Utah, allows its subscribers to link their Netflix accounts to the Google Fiber TV box, according to this Google Fiber customer help page.

Suddenlink Communications, another TiVo partner, announced in May that it would open up access to Netflix on leased TiVo devices sometime this summer.

Update: Suddenlink said its support for Netflix on leased TiVo boxes also went live this week.

TiVo has several other U.S. partners that have not yet announced plans to support Netflix on leased devices, including GCI, Mediacom Communications, Vyve Broadband and Wave Division Holdings (Wave Broadband and Astound).

In addition to featuring Netflix at the main screen, Grande Communications has also given Netflix its own channel (399) on the guide that tunes customers directly to the Netflix home screen.

Like it is with RCN and Atlantic Broadband, Grande’s TiVo customers must have a separate Netflix subscription. Netflix maintains its billing relationship with those customers.

Grande, which serves parts of Austin, San Antonio, Dallas, San Marcos Waco, Corpus Christi, Midland and Odessa, said a TiVo box is included with its “Get-It-All" bundles, starting at $79.99 per month

Giving Netflix’s domestic cable distribution ambitions a boost, RCN, Atlantic Broadband and Grande Communications will be the first U.S. cable operators to offer Netflix on TiVo-powered devices that are leased to their respective pay-TV customers.

Of the trio, RCN and Atlantic Broadband will begin to offer access to Netflix via TiVo early next week, while Grande is expected to roll out software updates with the integrated Netflix component sometime in May, a TiVo spokesman said, confirming reports in The Wall Street Journal and Variety.   

Following a model used for TiVo/Netflix combinations offered by Virgin Media in the U.K. and Com Hem in Sweden, Netflix will retain a direct billing relationship with its streaming subscribers.

The updated TiVo software coming to those MSO-distributed devices, such as the TiVo Premiere and the T6 (the T6 is the MSO-tailored version of TiVo’s new Roamio platform) will offer integrated search that spans not just Netflix, but also the live TV lineup and the operator’s video-on-demand service. Netflix will also be displayed like a "channel" in the guide.

"Our view has long been that the marriage of linear television and streaming over-the-top (OTT) TV is the future of television, and Netflix has clearly emerged as a must-have over-the-top service," said TiVo president and CEO Tom Rogers, in a statement to Multichannel News. “This announcement underscores the transformative nature of the TiVo technology and its proven ability to enable over-the-top providers to be seamlessly integrated into a pay-TV platform. TiVo is the common technological thread bridging the gap for the first time here in the U.S. between operators and OTT services to help them deliver a superior and more complete offering to their subscribers.

Confirmation of the tie-ins came just days after Netflix CEO Reed Hastings and CFO David Wells disclosed in the company’s first-quarter letter to investors that the company’s first MVPD integrations in the U.S. would get underway “this quarter.”

In addition to Virgin Media and Com Hem, Netflix has also completed an integration with Waoo!, a Danish triple-play service. Google Fiber, which currently offers broadband and pay TV services in parts of Kansas City and Provo, Utah, allows its subscribers to link their Netflix accounts to the Google Fiber TV box, according to this Google Fiber customer help page.

TiVo has several other U.S. partners that have not yet announced plans to support Netflix on leased devices, including Suddenlink Communications, GCI, Mediacom Communications, Vyve Broadband and Wave Division Holdings (Wave Broadband and Astound).

Comcast has a retail partnership with TiVo under which the MSO has integrated its Xfinity On Demand service with TiVo boxes sold at retail. Cox Communications has a similar retail-focused effort underway with TiVo, but has yet to pull the trigger on it.

Netflix and Comcast, which has developed a subscription multiscreen VOD service called Streampix, have held talks about porting the Netflix app to Internet protocol-capable HD-DVRs and gateways that run on Comcast’s X1 platform. It’s unlikely that those discussions will evolve into a deal anytime soon based alone on the icy condition of their relationship.

Netflix, which reluctantly agreed to a paid peering deal with Comcast in February, announced its opposition to the proposed Comcast-Time Warner Cable deal earlier this week.

According to industry sources, Netflix has also insisted that MVPD  that offer its service on leased devices also become members of Open Connect, a private content delivery network that relies on Netflix-supplied edge caches.

RCN, Cablevision Systems, Cox Communications, Google Fiber, Suddenlink Communications, Virgin Media, British Telecom, Frontier, Clearwire, GVT, Bell Canada, Telmex and Telus are among the known members of the Open Connect program.

Atlantic Broadband,  a subsidiary of Cogeco Cable that serves more than 230,000 customers in western Pennsylvania and parts of Maryland and Delaware, also participates in Open Connect, according to Variety.

Historically, Netflix’s agreements with some content partners have prevented it from offering services on MVPD-leased devices, but those issues have apparently been ironed out.