Sunday, June 29, 2003
From Rich Shockey et al
>BellSouth Revenues Down but DSL Up
>BellSouth just reported end-of-the-year financial results, with
>revenues
>for the year at $18.23 billion, a decrease of 4 percent from the $18.98
>billion a year ago. Net income was $1.42 billion, down 44.6 percent from
>the $2.57 billion of a year ago. Although BellSouth did not say what
>geographical areas would be covered, the area codes offered on its Web
>site include all the cities covered by Vonage, which covers most of the
>major metropolitan areas in the United States.
>
>BellSouth just reported DSL figures, and has now reached 1,021,000,
>growth
>of 65 percent over the 620,500 DSL subscribers it reported at the end of
>2001. The company has been one of the most aggressive in pushing out DSL,
>and a year ago the service was available to 70 percent of its customer
>base, or 15.5 phone lines. It is likely that the telco now has more than a
>million DSL subscribers, its goal for 2002.
>
>Vonage has been growing rapidly since its launch in August 2002, and
>just
>reported that it has 10,000 subscribers. The company did its first TV spot
>advertising the week of Jan. 13, and is planning direct-marketing
>advertising on television as well.
>
>To VoIP or Not To VoIP
>There are several forces at work, pro and con, in the RBOC's decision
>to
>deploy a flat-rate hosted voice-over-IP service, which uses technology
>that it has not yet deployed anywhere in its network.
>
>Though there is much focus on the technology issues between traditional
>and IP voice, one of the most interesting, yet risky, aspects of the
>Vonage service for an incumbent is that is flat-rate. Flat-rate services
>can be very attractive to consumers and reduce billing complexity, but it
>can also, in the short term, reduce revenues. A telco, such as BellSouth,
>that has just reported a drop in revenues may not be keen on cannibalizing
>its existing business.
>
>"I think they also get the opportunity essentially to keep their
>clients,"
>says Danny Klein, telecom infrastructure analyst for
>Yankee Group, who recently briefed BellSouth
>on Vonage. "If this does impact the market on a large scale, then there is
>going to be a lot of defection from traditional RBOC services to flat-fee
>calling services like Vonage. So though they could be cannibalizing their
>own sales, they are keeping the customer.
>
>Ownership of customers is important because, even if basic voice
>revenues
>go down, the company can always market other services to them. If
>BellSouth keeps ownership of the customer could still market other
>services to them. "It is certainly not characteristic of RBOCs or service
>providers in general to take the pre-emptive move of cannibalizing their
>own sales to add services, though that is the modern way to think," Klein adds.
>
>Klein observes,"This is almost a complementary service" to their
>traditional consumer offerings. It works only with a broadband connection,
>so you need either a DSL line into the home or cable. If BellSouth could
>combine them and offer a BellSouth DSL line plus Vonage service, it is a
>way to attract more DSL customers."
>
>Also, by packaging the two services together, a telco might be able to
>increase price and margins, and still give Vonage its cut. "So instead of
>offering a $40 service, they could offer a $50 service plus the DSL line.
>If customers pay $90 for DSL plus unlimited local plus domestic long
>distance, it's a less-than-$100 phone bill for all communications. It is
>almost like a triple play on the wireline side," Klein says.
>
>One could theorize that, if the BellSouth trial of these services is
>successful, it could launch its own in-house version and go into direct
>competition with Vonage and the other consumer VoIP services, such as
>Packet8, that are poised for commercial launch. Or it could simply buy up
>Vonage and absorb the service into its offerings.
>
>Either way, it seems inevitable that the small VoIP services will find
>competition in the long term from the telcos, which are not about to cede
>their consumer and small-business customer base to competitors.
>
> >>>>>>>>>>>>>>>>>>>
BEDMINSTER, New Jersey, Jan 23 (AFP) - Telecommunications giant AT and T's shares plunged 20 percent Thursday as it forecast sliding revenue in the year ahead.
AT and T swung into profit in the fourth quarter of 2002, but only
because
of the sale of its cable Internet operations, it said in a statement. It lost more than 13 billion dollars for the full year.
"AT and T said that it does not yet see a significant turnaround in the overall business services industry and, as a result, expects total telecom industry spending will be down again in 2003," it said.
On Wall Street, AT and T shares plummeted 5.09 dollars or 20.10 percent
to
20.23 dollars in early afternoon trade.
"The company also provided limited 2003 guidance, which does not paint a very encouraging picture for next year," Morgan Stanley analyst Simon Flannery said.
ATT Corp chief financial officer Tom Horton said the company also was abandoning the practice of providing quarterly and annual earnings per share forecasts.
"The goal will be to provide investors with additional financial and operational metrics to understand the key value drivers of the business," he said.
The decision follows in the footsteps of Coca-Cola Inc, Gillette Co, and McDonald's Corp.
In the fourth quarter, AT and T made a net profit of 516 million dollars, or 66 cents a share, after raking in 1.32 billion dollars from the sale of its AT and T Broadband division.
That compared to a year-earlier loss of 1.39 billion dollars, or 1.97 dollars a share.
Sales slumped 8.6 percent to 9.29 billion dollars in the quarter.
"We had solid operating results in the fourth quarter, reflecting our execution of the basics," said AT and T chairman and chief executive David Dorman.
"We saw continued growth in our local voice and data businesses despite
an
unsettled economic environment," he said in a statement.
"We are entering 2003 with a strong focus on meeting customer needs, improving shareowner value and maintaining our financial discipline and flexibility."
AT and T said it expected earnings per share in 2003 of 50 to 55 cents a share.
The business and consumer divisions both expected revenue to decline, albeit at a slower rate than in 2002.
AT and T completed the spinoff of AT and T Broadband in November. The division was merged with Comcast Corporation.
For the whole of 2002, AT and T reported a net loss of 13.08 billion dollars, as a 14.51-billion-dollar loss on discontinued operations dragged it down from a net profit of 9.15 billion dollars in 2001.
Revenue for 2002 was down 10.4 percent at 37.83 billion dollars.
djw/aln
REUTERS[ TUESDAY, JANUARY 28, 2003 03:35:02 PM ]
TOKYO: Japanese electronics conglomerate NEC and telecoms equipment maker Oki Electric Industry said on Tuesday they would cooperate in offering internet protocol phone systems for corporate customers.
Details will be announced at a joint news conference slated for 3.30 pm (0630 GMT).
IP systems carry voice over packet-based networks controlled by routers, which are cheaper to build than conventional telephone networks with costly circuit-switching systems.
Companies are increasingly looking at IP as an alternative to conventional telephony as its functionality and voice quality improve.
Nippon Telegraph and Telephone, Japan's dominant telecoms operator, said last year in a three-year business plan that it will focus resources on expanding its IP network, halting in principle fresh investments in its conventional telephone network.
That prompted Oki and NEC, major makers of equipment for conventional phone networks, to look for new sources of revenue.
Shares in NEC closed morning trade down 1.91 per cent at 461 yen, while Oki fell 1.42 per cent to 208 yen. The Nikkei average slid 1.01 per cent.
>BellSouth Revenues Down but DSL Up
>BellSouth just reported end-of-the-year financial results, with
>revenues
>for the year at $18.23 billion, a decrease of 4 percent from the $18.98
>billion a year ago. Net income was $1.42 billion, down 44.6 percent from
>the $2.57 billion of a year ago. Although BellSouth did not say what
>geographical areas would be covered, the area codes offered on its Web
>site include all the cities covered by Vonage, which covers most of the
>major metropolitan areas in the United States.
>
>BellSouth just reported DSL figures, and has now reached 1,021,000,
>growth
>of 65 percent over the 620,500 DSL subscribers it reported at the end of
>2001. The company has been one of the most aggressive in pushing out DSL,
>and a year ago the service was available to 70 percent of its customer
>base, or 15.5 phone lines. It is likely that the telco now has more than a
>million DSL subscribers, its goal for 2002.
>
>Vonage has been growing rapidly since its launch in August 2002, and
>just
>reported that it has 10,000 subscribers. The company did its first TV spot
>advertising the week of Jan. 13, and is planning direct-marketing
>advertising on television as well.
>
>To VoIP or Not To VoIP
>There are several forces at work, pro and con, in the RBOC's decision
>to
>deploy a flat-rate hosted voice-over-IP service, which uses technology
>that it has not yet deployed anywhere in its network.
>
>Though there is much focus on the technology issues between traditional
>and IP voice, one of the most interesting, yet risky, aspects of the
>Vonage service for an incumbent is that is flat-rate. Flat-rate services
>can be very attractive to consumers and reduce billing complexity, but it
>can also, in the short term, reduce revenues. A telco, such as BellSouth,
>that has just reported a drop in revenues may not be keen on cannibalizing
>its existing business.
>
>"I think they also get the opportunity essentially to keep their
>clients,"
>says Danny Klein, telecom infrastructure analyst for
>
>on Vonage. "If this does impact the market on a large scale, then there is
>going to be a lot of defection from traditional RBOC services to flat-fee
>calling services like Vonage. So though they could be cannibalizing their
>own sales, they are keeping the customer.
>
>Ownership of customers is important because, even if basic voice
>revenues
>go down, the company can always market other services to them. If
>BellSouth keeps ownership of the customer could still market other
>services to them. "It is certainly not characteristic of RBOCs or service
>providers in general to take the pre-emptive move of cannibalizing their
>own sales to add services, though that is the modern way to think," Klein adds.
>
>Klein observes,"This is almost a complementary service" to their
>traditional consumer offerings. It works only with a broadband connection,
>so you need either a DSL line into the home or cable. If BellSouth could
>combine them and offer a BellSouth DSL line plus Vonage service, it is a
>way to attract more DSL customers."
>
>Also, by packaging the two services together, a telco might be able to
>increase price and margins, and still give Vonage its cut. "So instead of
>offering a $40 service, they could offer a $50 service plus the DSL line.
>If customers pay $90 for DSL plus unlimited local plus domestic long
>distance, it's a less-than-$100 phone bill for all communications. It is
>almost like a triple play on the wireline side," Klein says.
>
>One could theorize that, if the BellSouth trial of these services is
>successful, it could launch its own in-house version and go into direct
>competition with Vonage and the other consumer VoIP services, such as
>Packet8, that are poised for commercial launch. Or it could simply buy up
>Vonage and absorb the service into its offerings.
>
>Either way, it seems inevitable that the small VoIP services will find
>competition in the long term from the telcos, which are not about to cede
>their consumer and small-business customer base to competitors.
>
> >>>>>>>>>>>>>>>>>>>
BEDMINSTER, New Jersey, Jan 23 (AFP) - Telecommunications giant AT and T's shares plunged 20 percent Thursday as it forecast sliding revenue in the year ahead.
AT and T swung into profit in the fourth quarter of 2002, but only
because
of the sale of its cable Internet operations, it said in a statement. It lost more than 13 billion dollars for the full year.
"AT and T said that it does not yet see a significant turnaround in the overall business services industry and, as a result, expects total telecom industry spending will be down again in 2003," it said.
On Wall Street, AT and T shares plummeted 5.09 dollars or 20.10 percent
to
20.23 dollars in early afternoon trade.
"The company also provided limited 2003 guidance, which does not paint a very encouraging picture for next year," Morgan Stanley analyst Simon Flannery said.
ATT Corp chief financial officer Tom Horton said the company also was abandoning the practice of providing quarterly and annual earnings per share forecasts.
"The goal will be to provide investors with additional financial and operational metrics to understand the key value drivers of the business," he said.
The decision follows in the footsteps of Coca-Cola Inc, Gillette Co, and McDonald's Corp.
In the fourth quarter, AT and T made a net profit of 516 million dollars, or 66 cents a share, after raking in 1.32 billion dollars from the sale of its AT and T Broadband division.
That compared to a year-earlier loss of 1.39 billion dollars, or 1.97 dollars a share.
Sales slumped 8.6 percent to 9.29 billion dollars in the quarter.
"We had solid operating results in the fourth quarter, reflecting our execution of the basics," said AT and T chairman and chief executive David Dorman.
"We saw continued growth in our local voice and data businesses despite
an
unsettled economic environment," he said in a statement.
"We are entering 2003 with a strong focus on meeting customer needs, improving shareowner value and maintaining our financial discipline and flexibility."
AT and T said it expected earnings per share in 2003 of 50 to 55 cents a share.
The business and consumer divisions both expected revenue to decline, albeit at a slower rate than in 2002.
AT and T completed the spinoff of AT and T Broadband in November. The division was merged with Comcast Corporation.
For the whole of 2002, AT and T reported a net loss of 13.08 billion dollars, as a 14.51-billion-dollar loss on discontinued operations dragged it down from a net profit of 9.15 billion dollars in 2001.
Revenue for 2002 was down 10.4 percent at 37.83 billion dollars.
djw/aln
REUTERS[ TUESDAY, JANUARY 28, 2003 03:35:02 PM ]
TOKYO: Japanese electronics conglomerate NEC and telecoms equipment maker Oki Electric Industry said on Tuesday they would cooperate in offering internet protocol phone systems for corporate customers.
Details will be announced at a joint news conference slated for 3.30 pm (0630 GMT).
IP systems carry voice over packet-based networks controlled by routers, which are cheaper to build than conventional telephone networks with costly circuit-switching systems.
Companies are increasingly looking at IP as an alternative to conventional telephony as its functionality and voice quality improve.
Nippon Telegraph and Telephone, Japan's dominant telecoms operator, said last year in a three-year business plan that it will focus resources on expanding its IP network, halting in principle fresh investments in its conventional telephone network.
That prompted Oki and NEC, major makers of equipment for conventional phone networks, to look for new sources of revenue.
Shares in NEC closed morning trade down 1.91 per cent at 461 yen, while Oki fell 1.42 per cent to 208 yen. The Nikkei average slid 1.01 per cent.
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