Kagan: Impact of economy on telecom minimal

Telecom analyst Jeff Kagan says telecom is holding up pretty well in today's economic turmoil and should be in good shape moving forward.

In an interview with the Orlando Sentinel, Kagan noted that while lots of customers are not cancelling Internet, phone or TV service, many are cutting back on the bells and whistles, such as premium channels, faster Internet speeds, and extras services on cell phones. Some are canceling TV service and watching shows over broadband through services such as Hulu and Apple iTunes.

As consumers get rid of landlines and go to cellular for voice service, phone companies are creating additional value-added services to make up the gap in lost revenue. Embarq is offering computer tech support over the phone for $15 a month, while AT&T's TV entry in Florida has pushed incumbent cable provider Bright House to add more HD channels and put caller ID up on the TV.

Kagan also expects a middle-of-the-road FCC regulatory hand on telecommunications issues in comparison to the Clinton (heavy) and Bush (hands-off) administrations. He's not so sure if Obama will be able to fulfill his promise of deploying broadband to all of America, given the budgetary challenges the government faces.

For more:
- Kagan predicts goodness for telecom moving forward. Article [1].