The Fiber Wars

How Job Postings Can Signal Industry Shifts

August 18, 2022 by Benjamin Francis

In a world full of ways for the internet to get to your home or business, the ideal last-mile solution has always been fiber-optic lines. Fiber combines speed with practically-unlimited bandwidth in a way that other solutions like traditional cable, 5G, and satellite just can’t match. But the trouble for would-be providers is that it’s as much about digging ditches and getting permits as it is about technology. Even a company as resourceful as Google has had trouble getting its Fiber service off the ground, shelving expansion for years and still cautious about developing it further.

Job postings can provide crucial intelligence on where an industry is headed. In this blog, we’re going to use fiber providers as an example of how financial analysts can discern what key players are likely to do, based on how they hire.

AT&T and Verizon are unquestionably the biggest players in the field. AT&T says that fiber is “​part of the mission to make AT&T the best connectivity provider in America.” Meanwhile, Verizon launched its One Fiber initiative in 2016. But there are others attempting to expand into fiber optic, as well: Altice USA, the fourth-largest cable provider in the country, has announced plans to build out fiber-to-the-home to increase its competitiveness.

For a company like Altice USA, building out fiber infrastructure comes with considerable risk: as a highly-leveraged company, they know well that new capital projects are subject to the whims of capital markets. And for giants like AT&T and Verizon, investors are only so willing to tolerate poor capital allocation decisions. Everyone following the market waits for public statements from these companies on their plans, and analyzes their quarterly and annual filings for signs of progress or pull-backs. Can real-time job postings provide an edge?

The answer is yes, and the results turn out to be surprising:

bar graph showing fiber-related job postings in 2022, with Altice USA having nearly twice as many as verizon, and AT&T with a fraction of that number

Altice USA, the smallest of the three, has by far the most fiber-related hiring year-to-date in 2022. This suggests that they are forging ahead with their stated plan despite interest-rate hikes and broad economic headwinds. On the other hand, while Verizon is continuing to hire, AT&T does not seem to be pursuing a faster pace of fiber build based on hiring trends.

Meanwhile, the question of where the fiber wars are taking place is also interesting:

Verizon job postings regional breakdown, with the heaviest concentration in Texas, the South, and the west coast
Altice USA job postings, showing heavier distribution overall

Both Altice USA and Verizon are heavily concentrating their hiring in Texas. This suggests that both companies know where the first battlefield will be. Investors would be well-advised to monitor market penetration in Texas for an early indicator of how the broader buildout will take shape.

But while this insight forms a compelling pattern, what real-world impact can it have? 

On August 3, Altice USA announced its earnings. They specifically called out an acceleration in fiber deployment:

  • Fiber (FTTH) rollout update: Altice USA is executing on an accelerated fiber deployment over the next four years across its footprint, targeting 6.5 million fiber passings by the end of 2025 (including 1.3 million total incremental FTTH passings in FY 2022). As of Q2 2022, the Company has 1.59 million FTTH passings, adding +270k new FTTH passings in the quarter, representing a significant acceleration from prior quarters (vs. +61k new passings in Q2 2021, and +146k new passings in Q1 2022).

These results validate our observations based on fiber-related job postings and suggest that, under appropriate circumstances, job postings can provide meaningful insight into a company’s strategic direction.

This is the value of job postings, especially when combined with information on background fundamentals and industry knowledge. Posting data provide insight into both company strategic plans and execution on those plans, and those signals can point in the direction of meaningful financial conclusions.