Cincinnati Bell to Spin Off Data Centers

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| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

Cincinnati Bell to Spin Off Data Centers

Last week when asked, I said that I did not see Cincinnati Bell spinning off its data centers. One reason was that the ILEC would be left with a declining wireline business and debt, which was the reason that CinBell had pursued a data center acquisition -- to offset the line losses.

This week, CinBell announced that it will examine spinning off Cyrus One as a REIT (real estate investment trust). The IPO will bring in much needed cash to pay down debt - $2.5B.With the data center business up 21% to $53M, CinBell is expanding the data center space.

Cincinnati Bell 1Q 2012 revenue is $363 million. Wireless revenue for the quarter is $64 million; Total wireless subscribers decreased to 446,000. Postpaid ARPU in 1Q2012 increased to $50.82 with Postpaid churn for the quarter at 2.2 percent. [source]

Wireline revenue for the quarter was $182 million - down less than 1%. CinBell is offsetting wireline (copper) revenue with FTTH.

"Total local access lines declined 7.8% year over year to 621,300 at the end of 2011, and comprised 552,400 in-territory lines and 68,900 out-of-territory lines," Zacks states.

"The company passed 13,000 additional homes and businesses during the quarter with its Fioptics product suite, bringing the total number of units passed to 147,000. Wireline added 3,000 new Fioptics entertainment subscribers and 4,000 new Fioptics high-speed internet subscribers during the first quarter, bringing the totals to 43,000 entertainment and high-speed internet subscribers at the end of the quarter," reported Seeking Alpha.

I wonder if cell churn is due to coverage or handset choices.

I don't know what the IT Services and Hardware segment is but it increased 4% to $73M.

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