Originally published: January 20, 2011
Last updated: January 20, 2011 - 4:25pm
[Commentary] Whatever happened to independent telco consolidation? We have been waiting for it to take off -- really take off -- for most of the last decade.
Maybe it seems like the wrong time to ask, as CenturyLink gets closer to acquiring Qwest Communications, , the company’s latest act of consolidation. Also, just this week we were reminded of another indie telco acquisition, FairPoint Communications’ buy of Verizon’s New England properties, a deal that went wrong but finally appears headed toward solid ground. Along with those deals, there have been plenty of others, led by companies like Frontier Communications and Windstream Communications. There was even at least one last month, as TDS Telecom moved to buy TEAM for business market expansion. Still, consolidation has failed—or is really taking its own sweet time--to develop into an industry-wide transformative experience. That’s a little surprising because the drivers for telco consolidation, such as the need to achieve greater scale to get more revenue channels and better vendor deals, as well as the need for bigger telcos like Verizon to get rid of landlines they don't care much about, have not gone away. For now, the things that could most be keeping telco consolidation from running rampant are fear and an extra dose of caution. That’s not necessarily bad. Maybe we (or was it just me?) were wrong to believe the wave would have swept in, changed everything and receded by now. Instead, telco consolidation is moving like the tortoise into its second decade. Perhaps it’s all for the best, as wiser companies will only make better deals in the future. But, when?
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