Shenandoah Telecom Co Technology Leadership Forum 2026

Brandon, thanks for the invite.

Absolutely. We run three lines of business. Our Glo Fiber business is our residential fiber business. It represents about 28% of our revenues. The past second quarter, year-over-year, it grew 33%. So growing like a weed. We've built about 500,000 passings, greenfield passings, to overbuild in rural markets to be the second competitor in those markets for broadband and the first to provide fiber and having great success on that side. We also run a commercial fiber business that represents about 23% of our revenues. That grew 9% year-over-year in the second quarter. It's been up a tick. We've been growing more in the low to mid-single digit growth rates, but it's picked up more recently. This business serves commercial customers from the national wireless cellular guys with backhaul. We provide bandwidth to other carriers. We have a big K through 12 E-Rate program business.

And we just serve general enterprises in our local areas. Great, solid, recurring revenue business for us. Then the last piece is our incumbent cable business, which we've owned for over 20 years. Not spending a whole lot of capital in that business. That I think about in three different types of buckets. We have our more dense markets, good demographics. Those areas generally have another broadband provider. But we've been performing well there. That's been the case for about three years now, and we've put a good playbook in place that we have a more competitive rate card, and we're more than holding our share from a unit perspective. Our churn rates have come down, but we are giving up a little bit of ARPU to accomplish that.

We also invested some capital over the last three years and are virtually complete to build about 25,000 passings with government grant subsidized money, primarily, that they subsidize about half of the build. There, that's a growth segment for us. We expect to increase penetration. We're at 40% today after about two years, and we expect to get to about 65% penetration in the next couple of years. Then the last bucket is we are the only. It's very rural, and the demographics tend to be more challenging. But there's not another broadband provider. So I think we're protected from that side. That's an area that we mentioned on our last earnings call. We're trying to better align with the demographics there, our offerings.

We did see some higher churn in those markets, and that's something we've addressed with the new rate card that we introduced in March, specifically to offer a lower price for the entry level broadband service. And that, so far, has paid some dividends. We saw the churn rates come down sequentially in that area from the first to the second quarter, but still an area that we're looking to improve on.

Yeah. That last bucket of passings is the only area that we actually saw any kind of impact.

Okay in the first half of the year.

Virtually no impact in the Glo Fiber residential business and virtually no impact in the 35% of the passings where we have competition and the demographics are smaller. I think the reason for that is Starlink doesn't compete in the mid to the high end of the market where we compete very well on. The mid to the high end of the market at this stage of the game is really gigabit services. 80% of our Glo Fiber gross adds are buying a gig or higher. Actually, we have 20% buying 2 gigs to 8 gigs, which I'm not sure what they're doing at the household, but we're more than happy to sell them the service. The satellite technology just doesn't work fast enough to compete in that part of the market.

The areas where we did see a little bit of activity when Starlink got a little bit more promotional heavy in the first quarter of the year was in these unserved areas with the lower demographics. Like I said, we've already responded with a better lower alignment with our product line there, which seems to be helping us go in the right direction. It did add some churn in the first half of the year for sure.

Yeah. Starlink, I think, is a niche product in areas where it's difficult to provide a broadband service. My opinion is fiber and HFC coaxial cable will always have faster speeds, two, three, four times faster. Even as Starlink develops more advances in technologies, the fiber and the cable technologies are going to be even faster. Our goal is to provide a fair value and to provide good, again, local customer service, which is something we specialize in. We're not a national company. We're isolated to eight states in the Mid-Atlantic area, and this is all we do. When you're calling from West Virginia, you're talking to somebody from West Virginia. We think that local touch makes a difference. If you're a Starlink customer, I think your customer service is very minimal. It's more a do it yourself.