Hawaii no paradise for struggling telco

Hawaiian Telecom is one of the oldest ILECs in the United States and the largest telco in Hawaii. It's also more accustomed to losing money than Bear Stearns. The company, which Verizon sold to Carlyle Group in 2005, this week reported another lackluster quarter (if you can call losing $30.5 million simply lackluster). Since being purchased for $1.6 billion, Hawaiian Telecom has lost some $201 million and has reported just three profitable quarters.

In addition to the expected decline in landlines (about 2 percent), Chief Financial Officer Robert Reich said "mild softening in the business climate here in Hawaii" in Q2 hit the telco, leading to a revenue decline of 5 percent to $115.3 million from $121.4 million a year ago. On the bright side, Hawaiian Telecom said high-speed Internet connections edged up 2 percent, led by a 3 percent uptick in residential subscriptions.

The Carlyle/HT union has had its rough spots. Customer service and billing issues prompted consumer complaints and even some interest from state regulators. Top execs have left -- and been fired -- and the company has trimmed about 100 positions from its management team. Perhaps the new CEO and six top-level managers that came in during Q2 can stop the bleeding.

For more:
- See the Pacific Business News story
- Or the Honolulu Star-Bulletin story

Related articles:

Carlyle Group struggles to fix HT. Carlyle report
Hawaiian Telecom surfs directory sale to profit. Hawaiian Telecom report

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