The FCC has removed its rules against CLEC-Cable mergers. Right now the M&A department at Comcast, flush with cash, is picking out its next target. "Hey, Guys! Call me if you need help with valuations or choices!"
Sprint and VZ and 42K other companies are selling Office 365. This consultant says to short that stock. "Resting on existing revenue streams, they are becoming good at expense management, but aren't finding meaningful growth." Which is True. "Telecom are generally stuck in the legacy thinking that their role is to choose vendor technologies, operationalize them, and sell them to the masses." Which is also True due to Monopoly Mindset or what I call Bell-Head Thinking. "It does not cost that much money for new entrants to come into the marketplace and replace telecom in nearly every sense at a fraction of the cost structure. Hope is not a strategy. Real disruption is on the horizon. Great leaders will embrace the chaos and create new markets for their companies, and will assemble a team of people who have fun doing it." (I work with some of the smart ones!) Razorsight says that Pipe revenue will always drive most Duopoly revenue, since their margins on it are high.
On the flip side, CLEC business hasn't turned out as expected, says Gary Kim. A majority of the CLEC business was UNE-P until 2004 - and most of that went to consumers of AT&T and MCI. Cable owns that consumer voice business of the CLECs today. Cable is turning its attention to small business, which it will dominate to the chagrin of CLEC's and ILEC's alike. Cloud and managed services will be important for CLEC's and ILEC's for a couple of reasons: (1) staying relevant to the marketplace; (2) a non-facilities revenue stream; (3) an avenue of differentiation (if they actually take it); and (4) a way to reduce churn and increase ARPU with customers.
Script out Change by Dan Heath for Comcast Business
AT&T Southeast experienced a huge Metro Ethernet outage in Atlanta and South Florida yesterday. AT&T reported that it was a core Cisco router. This is the third outage for AT&T in the last few months. See here and there. What is formerly BellSouth's Metro Ethernet surprisingly is not resilient.
Final piece of news in the CLEC space: Inteliquent Announces Changes to Its Management Team. Inteliquent is the new name of Neutral Tandem and Tinet. Inteliquent's President/COO, Surendra Saboo, and the CFO, Robert M. Junkroski, are both stepping down on October 1.