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  issue highlights May 14, 2008 | A Penton Media, Inc. Publication  
NDS teams with Cox for next-gen user interface

VZW taps Android alternative for future phones

More disturbing numbers for telcos

Leap goes live in Vegas


editor's perspective
Troubling times

May 14, 2008, by Carol Wilson
On the surface, the first quarter of 2008 doesn’t appear to have been any kind of turning point in the telecom industry. But people smarter than me are seeing signs of foreboding that shouldn’t be ignored.

For example, the loss of primary access lines is accelerating at the major telcos, even as cable seems to be rebounding. AT&T’s disconnect rate for primary voice lines was 10%, the highest in its history. Verizon’s was even worse, at 11%, and worst still, the company added only a net 4000 DSL lines, versus 239,000 DSL lines a year ago. And the losses weren’t limited to the biggest telcos -- Embarq lost 120,000 access lines, Windstream dropped 42,000 and SureWest telecom voice lines shrank 14%.

More importantly, says Craig Moffett of Sanford C. Bernstein & Co., those accelerating losses are too big to be offset by the broadband revenues that are growing as AT&T rolls out U-verse and Verizon continues its FiOS buildout. And, as importantly, points out Clif Holliday, author of Information Gatekeeper Inc.’s High Speed Access Report, the telcos may be losing some of those customers to cable, for good, taking them out of the broadband pool. So when U-verse or FiOS come knocking, these customers may be too happily ensconced in a cable bundle.

Amidst all this gloom and doom, there is reason for hope. AT&T did add 491,000 lines, and Verizon has gain picked up the DSL ball, both in its marketing and in offering higher-speed services, so their trend lines don’t seem irreversible. But both companies are likely to continue depending more on wireless revenues for the near future, even as they continue to invest billions in their wireline networks. They are going to have to work hard to pull customers onto those networks.

Especially since there is also new competition looming, in the shape of the WiMAX consortium featuring Sprint, Clearwire and the likes of Google and Comcast. WiMAX could quickly be a broadband competitor to telcos everywhere.

This is a good time for telcos to be bearing down hard on getting their business right, staying close to customers, mining vendors for all the innovation they are worth and pressing forward with new service offerings that match what customers say they want.

Bad news there may be, but worrying about it accomplishes little. Doing something is what counts. We are seeing signs of innovation -- Embarq’s eGo phone, SureWest’s broadband VoIP offering, the aforementioned movement on the DSL front by Verizon and AT&T’s Advanced TV push -- but will it be enough? Too early to tell.

E-mail me at cwilson3@telephonyonline.com.


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telephony unfiltered blog

Not everyone sees the magic in Jack

The success of MagicJack in numbers alone is without a doubt notable. The company is selling around 8,000 devices per day and has experienced 25% week-over-week growth since it first came onto the VoIP scene in September. Still, not everyone is singing Jack’s praises. The company has left many Jack users frustrated with its customer service department.
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white papers

Service Delivery Platforms: "New Services Made Easy"

Today's service providers are facing well-known challenges: ARPU erosion as voice becomes a commodity; and aggressive competitors offering a broad range of services. In response, they must deliver new high-revenue services. Unfortunately, there is a major obstacle barring their path: their traditional network integration and marketing processes mean that new service development takes a very long time and costs a huge amount. That's why the Service Delivery Platform was developed. This white paper by Daniel Marcus of MetaSwitch describes how an SDP allows service providers to define, develop and deploy new services far faster than they have been able to in the past, all while reducing the cost of service deployment. Download today.
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Addressing Data Integration Challenges with SOA

A big challenge for telcos is validating data exchange as they integrate business applications. SOA (service-oriented architecture) offers tremendous promise to streamline application development and enable productive re-use of existing services. Learn how SOA is gaining ground. Read White Paper.
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top news

NDS teams with Cox for next-gen user interface

In a move to differentiate its television offering, third-largest cable provider Cox Communications today announced it has chosen NDS to implement a next-generation video user interface (UI).
  READ MORE >>  

VZW taps Android alternative for future phones

Verizon Wireless today made a radical shift in its phone strategy, announcing that it would make a Linux-based operating system the foundation of its future mobile applications platform. And that OS isn’t Android.
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More disturbing numbers for telcos

Two separate sources this week are offering up more analysis showing the telcos are falling behind the cable companies in the broadband and video battle.
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Leap goes live in Vegas

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Cogent revamps sales as productivity sags

FiberNet is embarking on a $2-million network expansion project to add capacity to its network and connect new metro markets just as the company is reporting an increase in higher-bandwidth optical transport services not seen in some time.
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Sprint: CDMA Direct Connect ramps up

As Sprint’s operating and customer losses continue to mount, the company revealed it plans it plans in the coming months to move its QChat CDMA push-to-talk technology from commercial trials to large-scale launch, reducing its reliance on the Nextel iDEN network for its industry leading Direct Connect service.
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MetroPCS to complete AWS shift in one year

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special report

Differentiate your Ethernet Services: Read Telephony's Special Report

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nxtcomm08 news

At NXTcomm08: Connecting TV to the Internet Revolution

In its June 18th session “Connected TV – Why TV is Joining the Internet Revolution” in Las Vegas, NXTcomm08 will look at a new category of connected TV services that fundamentally changes today’s TV experience, using Microsoft’s experiences as a case study. The session will show how technology and services will bring video entertainment and communications to a whole new level, uniting connected TV and content.
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