Cincinnati Bell says business VoIP migrations are alleviating pain of POTS line declines

Cincinnati Bell is not immune to voice landline declines, but in its business services segment it says the ongoing migration from TDM to VoIP is helping to ease these losses.

Speaking to investors during the fourth quarter earnings call, Chief Financial Officer Leigh Fox said that while the provider saw overall voice lines fall 4 percent between 2014 and 2015, these declines are being offset by customers transitioning to VoIP based services.

"I would say consistent 4% aggregate decline as you've seen it from 2014 to 2015," Fox said. "We are seeing a heavier adoption especially on the business side of VoIP lines, which is just a migration from access to VoIP lines. We see that staying pretty constant. So I would say that the migration and the decline on access lines all remain the same and you should see a consistent decline similar to what you saw in 2015."

As of the end of the quarter, Cincinnati Bell had a total of 305,000 business voice lines, down from 307,000 in the same period a year ago. Out of that mix, it had a total of 89,500 business VoIP lines, up from 86,000 in the third quarter. This figure includes Fioptics VoIP business customers.

In the Services and Hardware Segment, Cincinnati Bell reported fourth quarter 2015 revenues of $105 million, down $5 million from the fourth quarter of 2014. Full year revenue was $435 million, up $2 million compared to the prior year. Growth in strategic professional services, cloud solutions and managed services revenue was offset by anticipated declines in hardware sales.

Another area where Cincinnati Bell could make an impact with its VoIP and IP-based services overall is in the small to medium business (SMB) arena, one where it has seen growing competition from cable operators like Time Warner Cable (NYSE: TWC).

"As we expand on our relationships with commercial and enterprise customers, both in and out of territory, we are also exploring opportunities to increase market share with small and midsized businesses located in our region," said Ted Torbeck, CEO of Cincinnati Bell, during the earnings call.

During the fourth quarter the provider began a number of moves to make its offerings more palatable to the SMB market through new partnerships set on helping customers transition from TDM and copper-based services to fiber.

Cincinnati Bell is working with ETI Software Solutions' circuit management module to migrate existing T1 copper based business customers to fiber, while ATC has built a portal that will allow business customers to get quotes for Internet access and fiber-based Ethernet and transport services from Cincinnati Bell and other area providers.

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