Qwest's impending exit from the wireless service business not only highlights the challenges of being a mobile virtual network operator (MVNO), but also the idea that the service provider should refocus its attention on being a wireline provider. The carrier informed customers they have 60 days to find another wireless provider and they will not charge an early termination fee for any customer that disconnects from the service. What's more, Qwest says it will retain its agency relationship with Verizon Wireless so it can continue to offer a quad play bundle to its customers.
Despite the progress it made as an MVNO, Qwest was never really a big wireless player like its RBOC brothers AT&T and Verizon. Last year, Qwest ended an MVNO relationship with Sprint in favor of reselling wireless services from Verizon Wireless. As of July, the service provider said 75 percent of its wireless base migrated over to the Verizon Wireless network.
Wireless was not the only side business Qwest has tried to shed. Earlier this year, the service provider was reportedly shopping its long-distance network to other service providers, but then quickly abandoned the effort when it failed to get what it thought was a fair offer for the business. Reports emerged that Level 3 and Sprint were interested in purchasing the assets.
As the smallest of the three remaining RBOCs, Qwest has struggled to remain viable amid strong cable competition and wireless substitution. One silver lining that could arise from its exit from wireless is that Qwest will likely refocus more of its attention on its local service efforts, including its ongoing build out of its Fiber to the Node network, which passed about 2 million homes as of July.
- Dow Jones has this article
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