"Technological advances are increasingly integrating computers, phones, and wireless devices into the ways we communicate. That's a challenge for a company that relies heavily on traditional phone service for revenues, since the landline business is becoming less and less relevant to the average consumer. BellSouth's key to success, at least for now, is to bundle together wireless, DSL, long distance, and satellite TV service at competitive rates. This strategy will likely keep profits growing, albeit more moderately than before, and allow the company to reap higher margins via its entrenched infrastructure. "
Thursday, March 02, 2006
BellSouth was seriously hurt by hurricanes. But also line erosion: "By the company's own admission, customers are abandoning traditional landlines in droves. They're switching to cell phones, as well as voice over Internet protocol (VoIP) service... The competitors have steadily eroded BellSouth's customer base by offering cheaper calling plans packed with features such as free voice mail and unlimited long distance." (So VOIP adoption really is all about price). Revenues were up on DSL and Cingular: "Revenues rose about 2% to $5.24 billion, thanks to the addition of 204,000 DSL Internet subscriber lines; nearly 3 million customers now surf the Internet via BellSouth's DSL."