CenturyLink's broadband gains offset ongoing landline loss in Q1

CenturyLink (NYSE: CTL) may be facing ongoing losses in its traditional PSTN business, but in Q1 it was able to stem those losses with strong gains in broadband services.

During the quarter, CenturyLink added over 52,000 new DSL subscribers, bringing it to a total of 2.4 million broadband subscribers.

Glen Post, CEO and president of CenturyLink, said in the earnings release that in addition to "successfully integrating and operating the Embarq properties, slowing the rate of line loss in our business and meeting customer demand for high-speed Internet and high-bandwidth services."

While DSL subscribership rose in Q1, CenturyLink was able to reduce access line loss to 13.6, an improvement over Q4 2010 and 15.2 percent over Q1 2010. At the end of Q1 2011, CenturyLink had 6,397,000 access lines.

Separately, Qwest reported $2.85 billion in operating revenues, down 4.1 percent from $2.97 billion in Q1 2010. However, it did see an uptick in strategic service revenues as a result of increases in Qwest IQ Networking and data transport services, as well as higher broadband revenues driven by subscriber growth and an improving mix of higher speed broadband services.

Similar to CenturyLink, Qwest also saw a strong rise in broadband subscriptions with the addition of about 46,000 broadband DSL subscribers in Q1 2011. It ended the quarter with 3.0 million total broadband subscribers. As expected, Qwest saw its share of access line loss in Q1 2011. At the end of Q1 2011, Qwest had about 8.6 million access lines. The telco lost 223,000 lines in Q1 2011, which represented a 2.5 percent sequential decline and a year-over-year access line decline of 10.7 percent

Of course, the bigger challenge for CenturyLink going forward will be in not only completing its final conversion in Q3 2011 of the former Embarq, but beginning the lengthy integration process of Qwest and wrapping its recently announced deal to acquire hosting and cloud company Savvis Communications.

For more:
- see the earnings release
- Reuters has this article

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