PITTSBURGH, Penn.—The state of Alaska accounts for about one-fifth of the total geographic area of the U.S. but just 0.2% of the U.S. population, or around 724,000 residents.
Alaskan carrier GCI started as a long-distance carrier in the early 1980s, and through acquisitions of cable companies, became a CLEC and internet service provider in the mid-90s, explained Maureen Moore, chief customer experience officer of GCI, during a session at the Competitive Carriers Association’s Mobile Carriers Show on Thursday. The company was reselling wireless service from Dobson, and when AT&T acquired Dobson, GCI decided to build its own network—which it did through a combination of both building and acquisition, resulting in what Moore said she “would graciously call a patchwork quilt—it appeared there was not a technology we didn’t love, we have them all.”
John Myhre, GCI’s principal architect, said that the fragmented network made operations challenging. “You have all these technologies, and they all need their own spectrum,” he said. In addition to managing all the legacy tech, he continued, “We were in a difficult situation where were had deployed LTE, but that was the original LTE—pre-carrier aggregation, relatively low speed.” Managing all that technical debt ultimately became a drag on the overall business became more obvious as time went on. Moore said that in the 2015-2016 timeframe, GCI saw a couple of years of consistent customer losses and was lagging AT&T in Alaska. “We could see that we needed to make a change, or we were going to be in a desperate situation,” Moore said.
5G was the inflection point that the company used as a launchpad for network transformation—but it was a holistic effort, looking at transformation across the entire business from the network to revamping some retail locations. “If you upgrade the technology, that’s great, but the customer has to be cared for from the front to the end,” Myhre said.
“As a company, we didn’t approach this modernization as business-as-usual,” Moore said. GCI created a cross-enterprise working team with people assigned to it across all departments (in addition to their other work) in order to bring the whole business along with the network modernization. “We knew if we did business-as-usual, we wouldn’t have everyone ready at the same time,” Moore said. That cross-discipline project approach has now become the new model for GCI, she added.
GCI spent a year just going transport upgrades, Myhre said, so that when it actually upgraded a cell site, that site would have the backhaul it needed. In addition to upgrading its network, when it launched 5G in April 2020, it positioned its network as a premium option and it focused on making an initial launch and splash in its largest market: Anchorage, which holds more than half the Alaskan population. Beyond Anchorage, Moore said, GCI is approaching 5G deployment “surgically and very thoughtfully” and being careful to target the largest clusters of population.
And the modernization has seen GCI return to growth. Since the launch of 5G in early 2020, Moore said GCI has seen 12 quarters of consistent gains in postpaid wireless customers. In particular, she said that the company has seen reduced churn among customers who have its bundle of premium internet service and wireless—which is a bundle that AT&T can’t directly compete with. She specified that GCI sees a 40% lower churn rate among its bundle customers than in either standalone internet or standalone wireless customers.
“It has definitely paid off for us,” Moore said. “It’s obvious, but it shows that if you invest in the right areas, customers will come to you.” And it may be counterintuitive, she emphasized, but while customers are price-sensitive, they will pay more if they get more. When GCI was in its customer-losing period, its prices were lower than AT&T’s—but it wasn’t until the network quality improved that customers returned.
Lessons learned from GCI? Moore says, listen to what customers want and focus on that. Myhre says both to look for potential inflection points as a basis for transformation, (like the deployment of 5G) but also that operators have to make sure that they are keeping up with product life-cycles and reducing the amount of technical debt and legacy systems that they are managing. When networks are more cohesive and less fragmented, both everyday management and technology transitions then become a lighter lift.
“The key is to make sure you are life-cycling appropriately,” he said.
