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TDS Telecom seeks
to own and offer our
customers “the best
data pipe” into their
homes and businesses
through a portfolio of
broadband offerings.
TDS Telecom seeks to own and offer our customers “the
best฀data฀pipe”฀into฀their฀homes฀and฀businesses฀through฀
a portfolio of broadband offerings. The TDS Telecom
businesses—wireline, cable, and hosted and managed
services—pursue communications and data market
opportunities to provide compelling services, solutions, and
products to both residential and commercial consumers.
Wireline
In our wireline business, our targeted investments in
fi ber technology have strengthened our triple play bundle
offerings and resulted in higher average revenue per
connection฀and฀low฀churn฀rates.฀Take฀rates฀for฀our฀IPTV฀
service,฀TDS฀TV,฀have฀exceeded฀expectations฀in฀2015,฀
with฀98%฀of฀all฀TDS฀TV฀customers฀subscribing฀to฀triple฀
play฀bundles.฀We฀have฀now฀launched฀TDS฀TV฀in฀27฀markets,฀
enabling฀167,000฀service฀addresses,฀which฀is฀roughly฀
23%฀of฀our฀total฀footprint.฀By฀mid-year฀2016,฀we฀intend฀
to deepen our fi ber build to reach approximately 25% of
our฀residential฀ILEC฀footprint.
In order to accelerate sales, we have continued our
Fiberville marketing campaign, which markets high-speed
broadband฀and฀TDS฀TV฀in฀new฀neighborhoods฀prior฀to฀
build-outs. The campaign has been increasingly effective
over the past year, as we have seen 10-20% market
penetration in advance of turning up service.
Cable
We are pleased with the progress of our cable business
since we entered the industry in 2013. Cable is a natural
extension of TDS Telecom’s original wireline business
that enables us to leverage our existing expertise and
infrastructure.฀Both฀wireline฀and฀cable฀share฀the฀common฀
strategy฀to฀“own฀the฀best฀data฀pipe฀in฀the฀market.”฀As฀
part of this broadband strategy, we plan to continue
growing high-margin broadband services bundled with
video and voice products.
We are seeing our cable customer base continue to grow,
accelerated by the attractive demographics in these
markets, with household growth greater than the national
average. We continue to evaluate additional strategic
cable acquisitions that can further augment our growth
and profi tability.
TDS TELECOM
HMS
Our฀hosted฀and฀managed฀services฀(HMS)฀business,฀
OneNeck฀IT฀Solutions,฀is฀another฀key฀element฀of฀our฀
strategy to expand our business as it builds upon our
core capabilities. As a communications service provider,
we have foundational expertise in building and
managing data networks and IT infrastructure.
HMS฀plays฀an฀important฀role฀in฀TDS฀Telecom’s฀growth฀
strategy. We are in the advanced stages of integrating
the฀fi฀ve฀HMS฀businesses฀we฀acquired.฀In฀2015,฀we฀
completed both the construction of a new data center
in Denver, Colorado and an expansion of another data
center฀in฀Madison,฀Wisconsin.฀With฀this฀additional฀
capacity up and running, combined with a highly
motivated sales force trained on our extensive line of
services and products, we are poised for more growth.
While we saw higher equipment sales in 2015, there’s
still progress to be made in increasing recurring sales
revenues.฀We฀believe฀the฀HMS฀industry฀has฀attractive฀
long-term growth potential as mid-market companies
look to outsource their IT needs.
TELEPHONE AND DATA SYSTEMS 3