Collective Connection

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When the big telecom players deemed the most rural areas of the Rio Grande Valley too remote to serve, VTX1 Companies stepped into their boots and delivered beyond everyone’s wildest expectations.

It's a fact of business life: Entrepreneurs take the risks and people with no investment come out of the woodwork with unsolicited advice. “It’s simply not feasible,” they’ll say. “If it could be done, we’d have already done it,” is a favorite of turf-guarding Goliaths in every industry.

In South Texas in the early fifties, many rural communities lacked access to telephone service. At the time, most of the telephone companies serving the state felt that the time and expense of connecting remote communities simply wasn’t worth the investment.

By then, utility cooperatives formed through the Rural Electrification Administration, part of Roosevelt’s New Deal, had brought electricity to most towns in South Texas. However, the ancestors of today’s telecom industry were completely focused on cities and suburbs and the built-in profitability of more populous urban areas, as well as the pre-existing infrastructure on which they could conveniently expand coverage.

It didn’t matter to them that people living and working in South Texas deserved to have the same opportunities for connection as city dwellers, but it mattered a great deal to the people of Willacy County and the surrounding towns, as well as a vast number of surrounding small communities in the Rio Grande Valley. It also mattered to a group of dedicated citizens who united to bring Valley Telephone Cooperative, Inc. to fruition and deliver telephone service to everyone that electricity could reach.

That effort is the taproot of VTX1 Companies, providers of residential and commercial internet and phone services throughout South Texas. With a service area encompassing more than 41,500 square miles – an area about the size of Ohio – VTX1 serves customers from Brownsville to the southeast of Austin, from Laredo to Corpus Christi and San Antonio with broadband, fiber optic, wireless, and landline technologies. In addition to serving some of the biggest names in telecommunications, VTX1 connects universities, medical centers, ranches, businesses, and school districts.

By taking on the challenge of connection in areas where literally nobody else wanted to try, VTX1 has developed into a powerful economic development engine for the communities they serve, including universities, municipalities, and independent school districts throughout the region.

Got broadband? Thank a cowpoke.

After working for years in the industry, company Chief Technology Officer Sebastian Ivanisky began his career with VTX1 nearly two decades ago as a field tech. “If you research the telecom industry, you’ll find a lot of parallels to the history of work we're doing,” he recently told BOSS.

As the internet caught on, reaching customers as smoothly and quickly as possible became the ultimate priority. As wide acceptance drove the need for speed, companies ramped up their quest to move faster and reach farther. “Those of us who’d been in telecom for a long time were like cowboys, just stringing things together, kind of being our own bosses and playing with the physics of it to try to make it work,” Ivanisky explained. “If you trace the genes from those days, you'll see that this is how we got to 5G.”

Chief Financial Officer Wyndi Klostermann agreed. “One of the biggest advantages of this company is that we’re really big into researching and investing in new technology. We were one of the first in the Valley to invest in fiber optics, and now that is what everyone is looking for. We were way ahead of the curve when we started putting our first strand of fiber in the ground.”

As Chief Executive Officer Dave Osborn put it: “We’ve transitioned from a telephone company to a broadband company and had to learn how to work in a competitive environment with different rules in an unregulated world. It’s been not only a technology shift but a huge cultural shift as well.”

That cultural shift is directly related to the growth in the areas that VTX1 calls home. Well before the current surge in demand for broadband access, the firm expanded their fiber network footprint throughout a host of communities in need of reliable, robust, and fast connectivity. The effort included connecting the universities and colleges in the Rio Grande Valley and University of Texas campuses in the region for the first time, with the bandwidth and speed crucial to competing for valuable research opportunities that attract the nation’s best and brightest minds.

“There’s serious research being done at a university campus in Brownsville,” Osborn said. “Through us they have a 10 GB and a 100 GB connection all the way up to Central Texas. That makes those data transfer files much simpler and much less onerous to move, time wise. We have changed the whole complexion of their research efforts with that kind of bandwidth accessibility.”

That accessibility requires significant investments in technology and keeping up with the breakneck pace of advancements requires solid long-term partnerships with tech providers. “The best way to ensure a long term relationship is through shared vision,” Ivanisky said. “I believe we have found exactly that with Cambium Networks, along with CTI Connect.” Cambium has partnered with VTX1 for two decades.

“Cambium focuses on a product roadmap of longevity and compatibility to ease the pains of hardware migration,” he explained. “CTI Connect walks along the path with us to offer the benefits of their own relationship with Cambium as well as other vendors they work with.”

Building a reliable broadband network requires incredible flexibility and scalability. “Many years ago, when our broadband network began to take shape and grow, we had to decide which routing and switching platform would enable the scalability needed for the broadband of the future,” Ivanisky said.

Enter  Juniper Networks, named by Gartner as a leader in several of their Magic Quadrant research categories. “We found in Juniper the sharp focus on service delivery and provisioning. The Junos operating system is the cherry on top. It allows for a seamless experience across hardware devices, regardless of size and capacity, making it effortless to support our staff,” he said.

Investments for a bright rural future

Spectrum, radio frequencies assigned for different kinds of communication over the airwaves, is divided into a dozen bands. Of those, mid-band spectrum has the capacity and speed needed for 5G, the ultra-fast, low latency technology that will be crucial for economies to grow in the coming post-pandemic years. The FCC administers spectrum for state and local use.

According to Ivanisky, when the FCC auctioned mid-band spectrum in 2020, VTX1 invested over $12 million in licenses for more than 30 South Texas communities to become the second largest rural cooperative in the state, third largest rural provider in the nation, to make that game-changing commitment – and the 16th largest investor in the $9 billion auction overall.

“A lot of people are going to the urban areas in search of employment, but good broadband is available in rural communities like ours. From my perspective, if I can get internet and a good job I would much rather live in a smaller town or rural community,” Osborn said.

South Texas is home to Eagle Ford, the country’s largest shale play. From 2008 to 2014 it drew companies from all over the world, all of whom sought to set up shop in communities where VTX1 had built fiber optic technology. “That's where they wanted to put their offices, their mining camps, and all of their storage facilities because they were using the internet daily, and they wanted good connectivity,” Osborn said.

At the time, George West, a town with only about 2,500 residents, had the ability to get fiber to the premises for the internet. The Eagle Ford boom meant the construction of a 400-room hotel, which Osborn said would have “gone up the road without us. We are a game-changer for a lot of the towns.”

VTX1’s forward-thinking growth and innovative products and services continue to attract employers to the region. “People don't have to leave Falfurrias (pop. 4981) to move to Houston,” Osborn said. “They can stay there or in Jourdanton, Orange Grove, Harlingen – wherever they can get good internet service. By bringing good employers in we've been a tremendous development machine for rural communities. All of the support services and businesses that will come to these areas are a great opportunity for us to expand and be both a service provider and a catalyst for growth in these communities.”

A new ‘utility’ with a vision to do much, much more

As the commoditization of internet services has transformed it into a utility, with customers expecting the same access they have to power and water, the very essence of internet and telephone service providers is changing. “Because it’s become a utility, we have to work harder to compete to deliver a service that the customer actually values,” said Vanessa McPhee, Chief Strategy and Marketing Officer.

Not only does VTX1 provide top-of-the-line Calix routers for their residential customers that need them, but they also leverage the company’s Marketing and Support Cloud solution to stay one step ahead of service issues and ensure the proactivity that is VTX1’s hallmark. “Additionally, Calix offers automated broadband testing, which is a great fit for VTX1 to comply with the FCC's upcoming broadband testing requirements,” said Ivanisky.

There is more than a touch of irony that the internet has made it commonplace to switch utility companies at the click of a button, a fact not lost on McPhee and her colleagues. “Because it's easy for a customer to switch over to a different provider, we don’t want to get into a cycle of gaining one customer and simultaneously losing one, like hamsters in a wheel,” she said.

That is why VTX1 is developing state-of-the-art tools to proactively reach out to customers that may be having issues with their connectivity before they even contact VTX1 about them. “We can ask them targeted questions whereby we can help them to overcome these issues,” she said. “There may not be a problem with the internet. It could be a related technology issue, but if we can see where the challenges are, we can call our customers, help them to get better service from us, improve their overall experience, and thereby increase customer loyalty.”

Taking a value-added approach to their services and programs is one way VTX1 seeks to keep its customers for life. From software offerings that help businesses operate better to ensuring the safety and security of customer communications and data, the company aims to deliver one of the most compelling services of all – peace of mind.

“We’re bringing a lot of value-added services to businesses, individuals, and families to help protect them and give them the peace of mind that using our service is going to keep them safe from unwanted attention or interference,” McPhee said. “It's really about transforming ourselves from simply being an internet service provider into a service that they cannot live without. We are becoming more than a utility. We are adding significant value in terms of software, security, and safety.”

Securing and protecting data is of the utmost importance, especially in organizations with a fair amount of M&A activity, so VTX1 relies on cyber services innovator Dynetics for their cybersecurity solutions. “Acquiring a diverse set of philosophies when it comes to protecting your network and customer data can be complex,” Ivanisky stressed. “We found in Dynetics a partner that is about offering a holistic approach to cyber security that’s not limited to products and gadgets, but also training and processes. The value we see in them is about protecting every aspect of the organization, not just the IT related items.”

Chief Operating Officer Patrick McDonnell pointed to telecom infrastructure experts GRIDSOURCE as a company that’s not just on a parallel growth track as VTX1, but one that’s aligned with their community support philosophy as well.  “As we have grown, they have quickly expanded their operations with new local employees and equipment. They are one of our go-to companies for after hours, emergency situations, as well as our everyday needs,” he said. “They also have a similar attitude as VTX1 does about helping to support our local communities. They give back.”

One thing utilities have always done is serve as a nexus of job opportunities in their communities. “As we've grown and expanded, we've had to become more competitive in attracting quality employees who are specialized in newer technologies,” said Chief HR Officer Roy Sheneman. “In the last 15 years we've really sharpened our ability to develop our people and create an environment where employees can go back to school to pursue degrees or for advanced certifications in various fields.”

“We also provide superior on-the-job training and that's creating a culture that raises the bar for everybody and allows us to do more, do it more efficiently, and be more effective in providing service... we serve with a lot of integrity and are happy to be the hometown provider for communities that otherwise wouldn't have access to the rest of the world.”

VTX1 has never been – and will never be – all hat and no cattle. “We don’t just want to be the biggest,” Osborn said. “We want to be the best.”

From supporting neighbors and invigorating communities to making new discoveries possible, they are a Texas-sized big deal. We can’t wait to see what they do next.