Synopsis
The US telecommunications sector witnessed further significant consolidation between 2005 and 2007, first with Verizon’s acquisition of MCI, then SBC Corporation’s acquisition of AT&T Corp, rebranded AT&T Inc, and finally AT&T’s acquisition of BellSouth. The mergers are largely a strategic response to the increased competition from new technologies which are eroding traditional fixed-line telephone revenues. Competition from wireless voice and data (SMS) providers such as Sprint Nextel continues to intensify as wireless usage grows. More recently, VoIP has become a significant competitor, being offered by the cable MSOs as well as by pureplay providers such as Vonage and Skype. The telcos are responding not only by merging, but by focusing on their DSL offering while picking up the pace of their fibre optic deployments, in order to themselves offer a triple play bundle of video, broadband and voice services. This report provides an overview of the major US telecommunication companies, focusing on the three major fixed-line operators AT&T, Verizon and Qwest.