Today's Top Stories NTELOS (Nasdaq: NTLS) is giving the telecom industry a sneak peek at how its wireline business, which will combine the current NTELOS Wireline and FiberNet units, by announcing that the new publicly traded company will be called "Lumos Networks."
A product of NTELOS' previous decision last December to separate its wireless and wireline operations, Lumos Networks will hold brand launch events in four of its key markets: Charleston, West Va., and Waynesboro, Covington, and Daleville, Va. Meanwhile, NTELOS Wireless will retain the NTELOS name, providing nationwide wireless service.
Michael B. Moneymaker, President and CFO of Lumos Networks Corp., said that the name change will help create brand identity for the wireline side of the business, something that can be challenging when two powerful segments have to compete for capital and people resources.
"The change to Lumos Networks will allow us to create a stronger identity for our wireline business--data, broadband, voice, and IP services," he said. NTELOS isn't alone in its desire to create separate identities for its wireline and wireless holdings. The ILEC actually joins other service providers like Sprint (NYSE: S), which spun out its former wireline operations as Embarq, now part of CenturyLink (NYSE: CTL), and the former Alltell spinning out its wireline assets to create Windstream (Nasdaq: WIN). When the transition is complete, Lumos Networks will be listed on the Nasdaq, trading under the symbol "LMOS." For more:
- see the release Related articles:
nTelos breaks up wireless and wireline holdings into separate units
nTelos completes FiberNet acquisition
NTELOS buys FiberNet from One Communications
nTelos FiberNet acquisition faces opposition from Frontier Read more about: Wireline Operations, IP services, NTELOS, Lumos Networks
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tw telecom (Nasdaq: TWTC) saw the benefits of its business-centric services focus in Q2 2011 take shape as the service provider reported that revenue grew 1.8 percent to $338.4 million. On a year-over-year basis, revenue was up 6.8 percent, up from the $316.8 million reported in Q2 2010, representing a year-over-year increase of $21.6 million.
As has been the case in previous quarters, the growth drivers in tw telecom's earnings mix continue to be derived from enterprise, data and Ethernet and VPN-based products. Data and Internet services represent 47 percent of revenue for the quarter versus 42 percent in the same quarter last year.
During the Q2 2011, tw telecom's enterprise revenue grew 2.2 sequentially and 8.3 percent year-over-year. Likewise, data and Internet revenue grew 3.9 percent sequentially and 17.9 percent year-over-year, a factor that was driven by a 29 percent year-over-year increase in Ethernet and VPN-based products. Larissa Herda, tw telecom's Chairman, CEO and President, said that "Our success was driven by our strategic data and Internet portfolio, including the new product initiatives we launched last year." Ongoing demand for enterprise services drove tw telecom to increase its fiber-connected building additions nearly 60 percent. Outside of enterprise sales, tw telecom reported a $2.6 million increase in wholesale services, which it attributes to more wireless backhaul services to wireless operators and more Ethernet services to other service providers to serve their end-customer base. Of course, there were some obvious losses.
tw telecom's net income was $14.3 million for the quarter, down from the $242.3 million in Q2 2010. The service provider's net income was impacted by a $227.3 million non-cash income tax benefit in 2010.
Network services, for one, declined 1.2 percent, a factor that tw telecom says reflects growth in other services, including colocation. Voice services remained nearly flat with 0.7 percent growth, reflecting churn and a reduction in usage-based services.
Ongoing demand for its enterprise and wholesale network services, tw telecom decided to raise its 2011 annual capital investment guidance to $340 to $350 million. The increase in capital spending will be used to drive more success-based investments to connect new customer locations, expand colocation facilities and extend the reach of its fiber network. For more:
- see the earnings release (PDF) Related articles:
Larissa Herda, tw telecom: Wireline's most powerful people
tw telecom's Q1 revenues boosted by data sales
tw telecom argues that IP voice should be designated a telecom service
tw telecom's Ethernet services enable Core NAP to expand its service reach Read more about: tw telecom, Enterprise Sales, second quarter 2011 earnings
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Verizon (NYSE: VZ) may have one of the largest global IP-based networks, but even they have areas where they just can't reach or are too expensive to deploy--so they are complementing their Private IP Service suite with mobile satellite solutions.  | | Verizon Private IP satellite network availability (Source: Verizon SLA) |
Since the satellite services leverage Verizon's MPLS private IP network, Private IP customers will be able access their respective private networks from any area where Verizon has satellite service coverage. Customers can use the Mobile Satellite Solution to support an array of services, including primary access, business continuity, digital signage, IPTV or content delivery. Depending on the specific configuration, Verizon can get its Mobile Satellite Solutions up and running in the U.S. within 24-36 hours.
While Verizon's drive to integrate its Mobile Satellite Service as part of the Private IP Service suite may be new, the service provider has been delivering satellite services for over 20 years to business and government customers. In recent years, Verizon's Mobile Satellite Service has been used during Hurricanes Katrina and Rita, the Sept. 11 World Trade Center attacks, and the Oklahoma City bombing, in addition to large floods and wildfires. For more:
- see the release Related articles:
Verizon Business wins $50M Australian DoD contract
Verizon appoints Bob Toohey president of Verizon Business
Verizon Business taps into Africa's business market
Verizon addresses distributed businesses with UC&C-as-a-Service offering Read more about: Mobile Satellite Service, Verizon, IPTV, Government Customers
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Telus' (Toronto: T.TO) ongoing moves to expand its wireless and wireline service portfolios helped drive Q2 2011 revenue up 6.4 percent to CAD 2.55 billion (USD 2.56 billion). The revenue increase was the result of about a 10 percent in wireless revenue and 3 percent growth wireline growth. Both the wireless and wireline divisions reported that they saw continued growth in delivering broadband data services to customers.
Driven by growth in data and equipment revenues that were partially offset by expected declines in local and long-distance voice revenues, Telus' external wireline revenues were up 3.1 percent or CAD 37 million (USD 37.2 million). Darren Entwistle, TELUS President and CEO in the Q2 2011 earnings release, said that the wireline unit's "growth is supported by solid TELUS TV and high speed Internet customer additions of 59,000 on a combined basis, up 84 percent year over year," adding that "TELUS' TV client base surpassed 400,000 customers this quarter while our voice business yielded the lowest level of consumer line losses in five years." Here's a breakout of Telus' key wireline metrics: - Wireline Voice Losses: While Telus did see expected 4.2 percent network access line (NAL) loss to 3.68 million due to cable competition and wireless substitution, residential NAL losses of 31,000 improved by 20,000 year over year, a factor it attributes to bundling voice with its Optik broadband data and voice services. On the business side, NALs increased by 7,000 due to increases in wholesale lines.
- Broadband and Data: In the wireline side of Telus, broadband was a key growth engine. During the quarter, Telus added 13,000 new Optik broadband subscribers due to what Telus said was a "pull through effect of Optik TV sales" in addition to ongoing broadband service expansion. At the same time, growth in Internet and enhanced data services and TV sales drove up total data service and equipment revenues were up 14 percent, or CAD 78 million (USD 78.5 million).
- Video Growth: Telus' bet on IPTV continues to pay off as the service provider signed up 46,000 new Optik TV subscribers in the second quarter, representing a 59 percent increase over the same quarter last year. As of the end of the quarter, Telus had 403,000 Opitk TV subscribers, a 77 percent increase over Q2 2010.
Given the Q2 growth Telus reported in its wireless and wireline units, the service provider has decided to revise its original consolidated revenue outlook for 2011 to CAD200 million (USD 201.3 million) to CAD 300 million (USD 301.9 million). For more:
- see the earnings release Related articles:
Telus appeals to SMB crowd with "Future Friendly" service suite
Telus Q1 revenues rise to $2.5B on strong wireline, wireless service growth
Telus changes its Usage Based Billing (UBB) tune
Telus Q4: Broadband, TV services drove 46% increase in profit Read more about: Broadband Subscribers, Telus, High Speed Internet, second quarter 2011 earnings
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MTS Allstream's (Toronto: MBT.TO) Q2 earnings reflect the ongoing challenge of balancing out new growth in broadband and converged IP services with legacy service declines. While MTS Allstream's revenue grew to CAD 443.7 million (USD 447.4 million), up slightly from the CAD 439 million (USD 442.7 million) it reported in Q1 2011, the big area of growth was seen in earnings per share, which rose 40.7 percent to 76 cents, and net income, which rose 41.5 percent to CAD 49.8 million (USD 50.2 million). Pierre Blouin, CEO of MTS Allstream said in the financial release that "Our past investments and strong focus on IP technology nationally and on unique bundles of home services in Manitoba contributed to another quarter of solid financial results for both MTS and Allstream." Looking at it from the division perspective, the growth of MTS and Allstream was driven by new consumer broadband and converged IP-based business services. MTS' continued bets to expand its wireless, broadband, and IPTV service initiatives, all of which all rose collectively by 9.6 percent year over year, paid off in Q2 as MTS reported that revenue rose 2.9 percent from CAD 232.8 million (USD 234.8 million) to CAD 239.5 million (USD 241.5 million). Allstream, however, again saw its share of IP-based service growing pains. Although continued to connect more buildings to its IP and fiber network, Allstream's overall revenue declined by CAD 5.9 million (USD 5.95 million), or 2.8 percent, to CAD 204.2 million (USD 205.9 million) from CAD 210.1 million (USD 211.9 million) due to declines in legacy voice and data revenues. However, Allstream's legacy losses were slightly offset by a 10.6 percent increase in converged IP revenues that are supported by success-based investments that are adding more new fiber-fed buildings to its network. In Q2 2011 alone, Allstream lit an additional 47 buildings on its network, bringing it to a total of 2,211 buildings as of the end of June. In addition to EPS, the success of both the MTS and Allstream divisions drove EBITDA growth. Overall EBITDA growth for the quarter was 8.6 percent year-over-year. Due to the Q2 results, MTS Allstream decided to raise its 2011 revenue outlook from CAD 1.7 billion (USD 1.71 billion) to CAD 1.78 billion (USD 1.8 billion). For more:
- see the release
- Winnipeg Free Press has this article Earnings report: Wireline in the second quarter 2011 Related articles:
MTS Allstream's legacy-to-next-gen growing pains take a toll on its Q1 earnings
MTS Allstream Q4 revenue declines slightly amidst strong data, TV growth
MTS Allstream introduces cloud-based disaster recovery service
Canada's CRTC requires incumbents to offer 15% discount to wholesale customers Read more about: IPTV, Mts Allstream, IP services, Wireless Broadband
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