When Frontier Communications emerged from bankruptcy in 2021, it faced a serious question for the future of its cable business. The company had stopped selling TV service in 2020 during the pandemic, with long install times deemed less safe for its technicians.

With the worst of the pandemic and its bankruptcy behind it, executives at the Norwalk, Connecticut-based telecom company had to figure out how to move forward.

“There was a question at the time, what do we do? Do we reopen TV sales or not?” recalls John Harrobin, executive VP of consumer for Frontier. “So we did a full evaluation and concluded that no, we’re not going to offer TV to our new customers.”

Frontier’s fateful decision two years ago looks prescient in the current moment.

The ongoing Charter Spectrum-Disney carriage dispute has been causing heartburn across the entertainment industry. With Charter CEO Chris Winfrey framing the fight as an existential one.“We’re on the edge of a precipice. We’re either moving forward with a new collaborative video model, or we’re moving on,” he told investors on a call last week.

10 years ago, Charter’s threat to leave its old TV business behind would have been laughable, with its still-rich profits and 10s of millions of subscribers. But it isn’t now, much to the chagrin of the entertainment companies reliant on cable TV’s billions of dollars in annual cash flow.

Frontier does not operate at the same scale as Charter Spectrum. Its footprint covers a little over 16 million homes in a number of states, including Connecticut (including Spectrum’s headquarters home town of Stamford), West Virginia, Illinois, and Texas. When it made the decision to stop marketing its video service in 2021, it had about 500,000 TV subscribers. Spectrum had over 15 million at the time.

Still, Frontier’s video service generated $620 million in revenue that year, a substantial flow of cash to ease out of (Harrobin notes that the company continued to offer video service for existing customers that still wanted it). The problems were the same articulated by Winfrey, only exacerbated by Frontier’s size.

“A lot of the issues are coming to the forefront now,” Harrobin says.

“[Due to the] size of our company, we don’t have the scale to acquire content at efficient rates, and the way that the rules of packaging work, by requiring all these channels, it’s basically a tax on consumers to pay for what they don’t watch. The average customer watches like 17 channels or something like that, but pays for over 100,” Harrobin adds.

Frontier, which had a largely copper wire footprint, decided to focus on building out its fiber-optic network when it emerged from bankruptcy. That meant moving away from its legacy TV business, and figuring out a new video model, something that close watchers of the Spectrum-Disney dispute will find familiar.

“So we said that, yeah, if you go 30 years out, there may be a full loop where we’re going to re-bundle stuff, but right now for the next decade or so, over-the-top — for lack of a better term — MVPD is probably the right solution for us. So let’s figure out how to enable that better than anyone.”

The result was a partnership with YouTube TV, a virtual multichannel video provider (vMVPD) that offers live, linear channels over the internet, no cable box required. Frontier began referring new customers to YouTube TV beginning in 2021, and earlier this year rolled out billing integration, where the YouTube TV service is included in the customer’s internet bill.

“We said we really want to go deep with one player that we think is best positioned and going to win,” Harrobin says. “So we made a bet. We made a bet on YouTube TV.”

The company did extensive consumer research, he says, and they found that consumers liked the YouTube TV service better than many of the others.

“They were growing faster than others at the time, and they’re in a position to win from a scale standpoint,” Harrobin says. “But also when you think about monetization through advertising, and their ability to do that and connect audiences across different platforms, they are in a position better than anybody do that. That is their business and TV is a mechanism by which to bring eyeballs and engagement in there.”

It helps that YouTube TV also has add-on packages (like a Spanish-language offering, and now NFL Sunday Ticket) that Frontier could help market.

“It was getting them to understand what value we could add here,” Harrobin says. “We said, listen, we’ll refer a bunch of business to you. You’ll see what we can do.”

Frontier receives some revenue through that marketing of third-party services. According to its last quarterly report, Frontier had video revenue of $229 million through the first 6 months of this year, including its legacy TV business, and its OTT offerings.

“It really has been I think even better than we expected, Harrobin says, adding that when the company began doing the billing integration earlier this year is “when the sales really took off.”

“It’s more significant than we expected, so we’re ahead of our business case on the overall offering on the partnership,” he adds.

Frontier reported more new fiber customers in Q1 than the rest of the major cable providers combined for their residential broadband, suggesting that its strategic pivot is working.

Charter Spectrum may not be thinking of the same model (Winfrey suggested it may lean into its forthcoming Xumo partnership with Comcast, which will aggregate streaming content), but it is certainly thinking about leaving its legacy TV business in the dust.

And Frontier’s satisfaction with how things are going suggests that the leverage, perhaps for the first time since the advent of cable TV, may indeed lie with the distributor.