Qwest: 10-15Mbps 'Plenty for Foreseeable Future' > Qwest between a rock and a hard place

reply to fAcEtIOUs

Re: Qwest between a rock and a hard place

I'd imagine muni competition, like the UTOPIA project, are Qwest's biggest concerns...and I dunno about the cable companies in the vast areas Qwest serves. Also consider the population density in their service area makes it much harder to get the ROI they need to keep investors happy.

They do need to move a little more aggressively, I think, though. Perhaps it would be wise for them to open up what fiber they do have to service providers, like Utopia has? I dunno...
KM
--
Lake George Poetry

Qwest's dilemma is pretty simple.

If they really want to compete with cable, they'll have to have big capacity into the house. They may think that 15-20 Mbps will do it, but it may not, depending on viewing habits, success of HDTV, and other factors. But we're looking at significant bucks for either level of video-capable speed.

In any event, the most that they can reasonably hope for would be to get about half of the video market--cable will fight to keep as many video customers as it can.

Nobody on Wall Street following telcos thinks "risk" of any type is a good idea--especially when the best you can hope to get is half of somebody else's business. Nobody following telcos on Wall Street sees the potential of true, full video on demand, either.

The result is that even if Qwest frees itself from a "Bellhead" mentality, it still has to deal with stock analysts thinking in that manner.

A dilemma, yes--but no tears shed here.

calvoiper
--
VoIP--the death knell of remaining voice monopolies!

reply to sporkme
You are kidding, right?

Why is Verizon the measurement of everything broadband? VZ may be deploying Fiber in many areas, but the lay is still very small. It looks like a large deployment because they are pickign areas in various cities and it makes it look like a nationwide roll out - but the bottom line is that VZ is still decades away from coming close to a systemwide deploy.

Further, competition? Try Comcast. Comcast is a serious threat to Qwest in the areas it serves. I can attest to that in the Twin Cities area as CC has taken about 145,000 phone lines from Qwest and with CDV they will take more.

Comcast will be launching DOCSIS 3.0 nationwide as it becomes available - this is not a guess, this is for sure. Comcast has been pushing for the 3.0 platform and has plans to lauch it. Unlike 2.0, which wasn't much worth investing in,3.0 is talked about by corporate all the time.

Want your competition? There it is.

Now, on the Qwest side, they are very correct that 10.0 is going to be enough for the close future. Why? Well, cable WILL be the more expensive choice as they believe it's all about value for the dollar. (reserve your comments if they are immature, thoughtless, or just bashing comments) Cable is pushing to give value for the money, not number of channels for a price. I tend to agree that there is a difference. Some people may experience issues with their cable (so do phone and sat customers, just read these forums) but cable does have a better product at this time and looks like they will in the future not to mention they roll them out much faster than phone.

HOWEVER - the reason that 10mbps will work for Qwest is simple - they will be going after the market that wants a a lower price, lower level of service to fit thier budget.

Cable wants to build the service of the future, phone wants to simply serve the "needs" of their customer base. To think that everyone wants or needs 200mbps up and down is foolish, or, simply living and thinking in your own world. EVEN with HD TV, and other advance services, NOT EVERYONE NEEDS OR WANTS THEM! There are many levels of needs out there - cable will serve most of them and phone will grab the rest.

Example - over New Years Eve, two nightlubs across the street from each other. One sold a huge street party package, grand dinner buffet with real nice food and other entertainment for a cover of $50.00. Normal cover is $10. That club usually has 600 people inside a given weekend night. NYE, they saw about 275. The club across the street, a little smaller, usually has no cover or a $3.00 cover and holds about 200 people. NYE they USED to sell an event for $20 but this year decided to sell a cover at $5 and really offer nothing more than a place to go a drink, watch musioc videos and creat their own party. This year, this bar was so packed and the line was out the door and they couldn't take everyone while the bigger club charing more had less - as usual. The smaller bar had net more moeny this year over last becuase they simply trimmed down their offering, offered the low price basic package for less than the competitor and they attracted a larger crowd.

Some people here have this fantasy that somehow all prividers are going to jack up their speeds and offerings and drop the price to near nothing in order to "survive" when the truth is, there is no need for everyone to offer the turbo charged service for everyone. I think they are realizing that there is still a very large market for those subscribers looking for less of a service for less of a price.

The moral? Yes, 10 *is* enough for Qwest.