Windstream CFO: CAF Impact Could be $40 Million Annually

Windstream expects to see a “halo effect” from the rural broadband deployments it plans to make using Connect America funding, said Windstream Chief Financial Officer Bob Gunderman. The CAF program will have “ancillary benefits,” he said, pointing to the hypothetical example of a remote location to which Windstream might have to deploy “10 miles of fiber down to the end of a dusty road in rural America.” The fiber route might well pass some businesses or other Windstream facilities that could be upgraded as well, he said.

An analyst said Windstream could net an additional $40 million in revenue annually, assuming it signs up 50 percent of the 400,000 homes targeted at average incremental monthly revenues of $20 with an 80 percent profit margin, to which Gunderman said “Your numbers aren’t that far off.” Gunderman noted that Windstream believes that over time it can get take rates in the 40 percent to 50 percent range in the CAF-funded areas.