With the Q1 2012 earnings season coming to an end, FierceTelecom is taking the time to size up the performance of the top 10 ILECs.
As seen in previous quarters, the top ILECs continue to see ongoing IP service growth pains. They continued to see gains in their next-gen business and consumer services, including broadband data, video and Ethernet, while voice services continued their expected decline.
At the top of the ILEC heap, AT&T (NYSE: T) and Verizon (NYSE: VZ) both continued to find success in their next-gen U-verse and FiOS service sets. On the consumer side, video and broadband continued to be hot sellers for both AT&T and Verizon. During the quarter, AT&T added 200,000 U-verse TV and 718,000 U-Verse Internet subscribers, while Verizon added 104,000 broadband customers and 108,000 FiOS TV subscribers.
Finally, CenturyLink (NYSE: CTL) reported that while revenues declined due to traditional voice losses, it saw continued progress with consumer broadband and business services growth. On the consumer end, the third largest telco reported that it added 89,000 broadband subscribers and 15,000 IPTV subscribers.
The top three ILECs' business services units were just as impressive. Driven by strategic business services, including managed services and Ethernet Verizon's business services grew 0.9 percent to $3.9 billion, while AT&T reported revenues from strategic business services, including Ethernet, VPNs, hosting, IP conferencing and application services grew 19 percent. While a decline in legacy service dragged down CenturyLink's Business Markets Group (BMG) revenue to $917 million, strategic service revenues such as Ethernet strategic rose 3 percent to $450 million.
Outside of the big three, the Tier 2 ILECs, including Windstream (Nasdaq: WIN), FairPoint (Nasdaq: FRP), and Hawaiian Telcom (Nasdaq: HCOM) all reported gains during the quarter.
Windstream (Nasdaq: WIN) reported a solid quarter with strong gains in broadband and business driving up total revenues to $1.55 billion. With its PAETEC acquisition closed, the service provider saw business revenues rise 3.2 percent to $897 million.
The performance of both FairPoint and Hawaiian Telcom were also notable with both telcos showing progress with their respective business and broadband initiatives. During the quarter, FairPoint added 4,375 broadband subscribers during the quarter, while seeing continued gains from its new carrier-Ethernet offering. Likewise, Hawaiian Telcom reported another positive quarter with $97.6 million in revenues of and added 2,246 new IPTV subscribers, which now passes 41,200 homes.
In the regional Tier 2 telco space, Consolidated Communications is in the process of completing its acquisition of SureWest Communications as the company shareholders and regulators review the deal. Both Consolidated and SureWest separately saw gains in their consumer broadband and video subscriber bases in addition to wholesale FTTT services during the fourth quarter.
Please take a look at the Q1 2012 metrics in the chart below. You can also look at our report of all of the service providers here in Q1 2012, and don't forget to look at our reports from second quarter 2011, and third quarter 2011, and fourth quarter 2011.
Q1 2011 Roundup -- Top 10 ILECs |
|||||||
Carrier |
Revenues |
Access Lines Q1 |
Access Lines Q4 |
Broadband Adds |
Total Wireline Broadband |
Video Adds |
M&A |
AT&T |
$31.8 billion |
37.8 million |
41.3 million |
718,000 new U-verse subs, 103,000 total new wireline broadband subs |
5.9 million |
200,000 U-verse TV |
Sold large stake in Yellow Pages to Cerberus Capital |
Verizon |
$28.2 billion |
23.7 million |
24.1 million |
104,000 |
4.35 million |
108,000 new FiOS TV |
N/A |
CenturyLink |
$4.61 billion |
14.4 million |
14.5 million |
89,000 |
5.64 million |
Nearly 15,000 |
Integrating Qwest, |
Frontier |
$1.27 billion |
5.16 million |
5.26 million |
11,700 |
1.77 million |
4,400 video subs (including satellite TV & net loss of 4,800 FiOS video subs) |
Completed integration |
Windstream |
$1.55 billion |
3.15 million |
3.18 million |
8,500 |
1.36 million |
700 |
completed PAETEC acquisition |
FairPoint |
$248.5 million |
1.01 million |
1.03 million |
4,375 |
318,510 |
Not reported |
N/A |
Cincinnati Bell |
$363 million |
608,600 |
621,300 |
Added 4,000 Fioptics high-speed internet subs, lost 4,400 traditional DSL subs |
257,200 |
3,000 Fioptics entertainment |
N/A |
TDS Telecom |
$1.30 billion (TDS) |
363,500 |
482,000 |
Lost 100 subs |
219,500 |
300 IPTV customers |
N/A |
Hawaiian Telcom |
$97.6 million |
408,883 |
416,667 |
104,358 |
3,167 year-over-year |
added 2,246 new subscribers (increased homes passed to 41,200) |
N/A |
Consolidated Communications |
$93.4 million |
226,167 |
227,992 |
1,455 |
110,913 |
981 IPTV subscribers |
Acquiring SureWest |
|
$51.4 million |
150,641 (RLEC & competitive connections) |
158,693 |
267 |
35,974 |
285 |
Spun off |
SureWest |
$62.8 million |
75,600 RGUs |
76,400 RGUs |
102,600 |
3,600 |
Being acquired by Consoli- |