When Cincinnati Bell completed its acquisition of Hawaiian Telcom this month, the transaction was sealed with several conditions. Among them: maintaining local management and labor agreements, and spending $20 million over the next four years to expand and improve the Honolulu-based phone, TV and internet service provider’s network — mainly by adding or upgrading service connections on Oahu and neighbor islands.
“One of the biggest benefits of our Cincinnati Bell–Hawaiian Telcom combination is that it will enable us to continue investing in expanding our next-generation fiber network statewide,” said John Komeiji, Hawaiian Telcom’s just-named president and general manager. “This has been our focus for the past eight years because it enables broadband connectivity and higher speeds to more people in more places in Hawaii.”
Hawaiian Telcom has already invested more than half a billion dollars in expanding the network on land and undersea. As part of that effort, the company is a partner in the speedy Southeast Asia-U.S. (SEA-US) Trans-Pacific Fiber Submarine Cable System, which was completed last summer. It spans some 9,300 miles, connecting Hawaii to Indonesia, the Philippines, Guam and California.
The upshot of the merger with Ohio-based Cincinnati Bell, Komeiji said, is this: “Together we’ll have more buying power and resources so we can save money on equipment purchases and other services. We’ll learn from each other and share best practices that will lead to greater efficiency and additional savings — savings we can re-invest into deploying our next-generation fiber network.”
A Honolulu native, Komeiji was a trial attorney for civil cases in Hawaii for three decades prior to joining Hawaiian Telcom in the role of general legal counsel about 10 years ago.
“I’ve always felt that Hawaiian Telcom is one of the most important companies in Hawaii because our services are vital to keeping people connected to the things and people that matter. So I jumped at the chance (for employment there), and I’ve never regretted it. I couldn’t be more excited and humbled to help lead this 135-year-old kamaaina company into our next chapter.”
Question: How will the merger affect competition in the islands, such as that with Spectrum (formerly Oceanic Time Warner Cable)?
Answer: Joining forces with Cincinnati Bell gives us greater scale … so we can better compete against national cable giants while keeping our name, our local identity and our team here in Hawaii. Spectrum may be our primary competitor but we compete with many other local and national service providers to earn our customers’ business every day. We welcome competition and believe it helps to drive innovation and keeps us all on our toes, ultimately benefiting our customers and our community.
Q: In addition to deploying more fiber, what are your initial priorities as Hawaiian Telcom’s new top executive?
A: To reach out to our employees, our customers, our vendors and suppliers, everyone who is an important partner of ours to communicate proactively about the combination and to introduce myself. It is vitally important to me that they understand why we joined forces with Cincinnati Bell, what it means for them and how to reach me if they need to. I believe that open, two-way communication and helping them understand the why behind our actions is critical to building trust and loyalty.
Q: Now in operation for about one year, is the $250 million SEA-US cable system working as envisioned?
A: Because Hawaii is located in the middle of the Pacific Ocean, undersea fiber cables are critically important to our everyday lives. These cables are the lifeline for broadband connectivity into and out of our state, which is why Hawaiian Telcom pursued the SEA-US consortium and made the strategic decision to invest millions of dollars to ensure that this vital trans-Pacific fiber cable landed in Hawaii.
Hawaiian Telcom is a part owner and operator of the international cable system. We were also selected by the consortium to serve as the SEA-US cable’s network administrator and our Network Operations Center manages the entire cable from Indonesia to Hawaii and on to California.
The SEA-US cable system has definitely exceeded our expectations. Not only does the system provide access to bandwidth for our own needs now and into the future, the project has proven itself a worthwhile strategic investment. SEA-US was recognized as “Project of the Year,” the most important undersea cable project completed in 2017, by the Asia Communication Awards held in Singapore.
Some new cable systems were announced, and if they go into service, they will tie Hong Kong, Japan and Australia into our SEA-US network, bringing more markets to SEA-US and Hawaii, and sparking more interest in its capacity.
Q: In the absence of something like SEA-US, Hawaii could become technologically (and economically) stranded?
A: Without it, Hawaii would be at risk of running out of trans-Pacific capacity. Years ago we were a strategic hub because the cables had to stop here for power and signal regeneration. Today the technology has improved so they can bypass our state and will only stop here if there is a good economic reason to do so.
Our team recognized Hawaii’s critical juncture with existing trans-Pac cables nearing end of life, and successfully convinced the global SEA-US consortium to change their original cable design that bypassed Hawaii to include us. This was truly an incredible undertaking and I’m so proud of what our team achieved together to positively impact our company and our state.
The SEA-US system was designed to last at least 25 years and to handle increased bandwidth capacity as technology advances. While it can meet our growing needs for many years, we should not rely on one system. Trans-Pacific cables take years to plan and build. … Hawaiian Telcom will continue to explore opportunities on future cable systems to ensure that the needs of our state will be met.
Q: Technology has changed significantly since you joined the company. What has been most surprising?
A: The rapidly growing need for more and faster broadband is particularly striking to me. In 2008, when I joined Hawaiian Telcom, the average speed nationwide was about 7 megabits-per-second (Mbps). In 2015, we launched 1 gigabit-per-second internet here in Hawaii. That’s almost 1,000 times faster speed just seven years later.
With the increase of the Internet of Things (IoT) connected devices, from smart bicycle locks to smart refrigerators that can gather data and “talk” to you and to other smart devices, customer demand for faster speeds continues to increase.
Q: A recent Federal Communications Commission vote has opened the door to ending “net neutrality.” Thoughts on the issue?
A: Like Cincinnati Bell, Hawaiian Telcom has always been a network neutral company. We believe in an open internet and do not throttle or block internet traffic. Internet service providers cannot pay us more to cut in front of the line. This was always our practice and will remain our practice.
Q: What sorts of innovation is on the horizon, five or 10 years down the road?
A: The exciting thing about being in the technology business is that as your readers are reading these words, the next Steve Jobs is tinkering away in his garage, developing innovative applications and programs that will do things we can’t even imagine today.
Hawaiian Telcom’s internet backbone, our next-generation fiber network will power these innovations now and into the future. With our continued investment to expand this network, we can support virtually any new technology.
As fiber becomes increasingly critical – expected to comprise 50 percent of the cable market by 2020 – our differentiated network will position us on the leading edge of our industry, able to anticipate and address our customers’ needs. Further, as 5G (fifth-generation wireless) becomes imminent, our combined company is one of the best-positioned diversified network and services companies in the country to actually deliver on the promise of a higher-speed standard for consumers and businesses.
In addition, the explosive growth of IoT – with $6 trillion in investment expected over the next five years – presents additional opportunities to leverage an expanded, leading fiber network.
