No "coconut telegraph," Hawaiian Telcom, through its operating subsidiaries, provides modern telecommunications services to residential and business customers in the island state. The company serves Hawaii's main island with about 500,000 local access lines in service. It also provides long-distance lines and broadband Internet access. Hawaiian Telcom resells wireless communications services through an agreement with Sprint Nextel. In late 2008 the company filed for Chapter 11 bankruptcy, citing increased competition and economic volatility. It emerged nearly two years later with its debt burden decreased from $850 million to $300 million. Hawaiian Telcom has been in operation since 1883.
Faced with mounting competition from mobile phone providers, as well as ISP's who offer computer telephony as an alternative to wireline accounts, Hawaiian Telcom has struggled to grow its base of subscribers and bring in sufficient revenue to fund its operations.
In a bid to refocus on its core communications business and to raise proceeds to pay off debt and improve services, Hawaiian Telcom in 2007 sold its directories business to Local Insight Media for an estimated $435 million. However, the sale wasn't sufficient to cover the company's mounting losses and, following changes to key executive personnel in mid-2008, Hawaiian Telcom began reorganizing under bankruptcy protection later that year in an effort to shed debt and generate new financing. Hawaiian Telcom has said that it is seeking to list its stock on a US public exchange.
Management changes began with the replacement of president and CEO Stephen Cooper with Hawaiian Electric Company veteran Eric Yeaman. Further appointments followed shortly after and resulted in fresh faces at the SVP level in such roles as marketing, finance, network services, and human resources.
Looking ahead Hawaiian Telcom is making investments in its network infrastructure to enable the delivery of digital television and expanded broadband service options in the face of better-equipped rivals such as AT&T who offer bundled voice, data, and video services. A more robust network will also make it possible for the company to court business clients with a need for outsourced network and data services. The company took a step in that direction in 2010 when it rolled out a new service for business customers known as Business All-in-One. Aimed at small businesses the package offers bundled data and Internet protocol voice service over a broadband connection.
Hawaiian Telcom agreed in 2012 to acquire the competitive local exchange carrier (CLEC) business of Honolulu-based Wavecom Solutions Corporation for $13 million in stock. The deal will add about 1,700 customers statewide, and augment the company's broadband fiber capacity. – less