Wednesday, November 29, 2006

More Decline from DSL Prime

  1. Covad dropped 16K lines on the quarter, with continued losses and overall flat revenue. The bright spot was the completion of almost 700 COs of ADSL2+, which will allow Covad and partner EarthLink to offer 10 and 15 meg service in many cities. {Which ELN announced last week].
  2. Confirming that LD prices in the U.S. are going UP, Oren Schaeffer of Qwest told the street “Wholesale long distance revenue grew 6.1%, both sequentially and year-over-year, on growth in minutes of 2.4% year-over-year.” He’s also serving more connections with 3% fewer people, and claims productivity growth of 6% a year.
  3. Om sees the decline in Verizon DSL adds: “Another proof that the DSL market is seriously slowing down. All these gains were not enough to offset the problems in traditional voice and other businesses. Wireline revenues were down 4.7% for the quarter.” For the last couple of years, DSL growth has roughly paralleled wireline revenue decline at many carriers such as FT. Wireline continues to fall rapidly, and neither DSL nor FIOS is likely to make up the lost revenue. Deutsche Telecom and AT&T are responding with massive layoffs and every price increase they can get past regulators, strategies most other telcos are likely to adopt. Bad time to work for a phone company.

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