Verizon: 3.1 Million FiOS Customers 9.1 million total broadband customers, 8,000 fewer jobs... Monday Jul 27 2009 12:21 EDT Tipped by caco Verizon issued their second quarter earnings this morning, reporting that they saw reduced net income of $1.48 billion, down from $1.88 billion one year earlier. Verizon added 1.1 million new wireless subscribers compared to AT&T's 1.4 million, bringing Verizon's wireless subscriber total to 87.7 million. Despite the lure of the iPhone, Verizon retains the wireless industry's lowest postpaid customer defection (churn) rate of 1.01 percent. FiOS growth was strong during the traditionally slow second quarter, with Verizon adding 300,000 net FiOSTV customers for a grand total of 2.5 million TV customers. The company also set a record with 303,000 new FiOS broadband subscribers during the quarter for a total of 3.1 million. Including both FiOS and DSL customers, Verizon now serves 9.1 million total broadband customers. On the negative side, Verizon saw 117,000 fewer vanilla DSL customers on the quarter, some of whom upgraded to FiOS, and some of whom switched to faster cable broadband. Lower net income was due to continuing residential landline losses, and a 6.7 percent recession-related drop in Verizon's global enterprise business. Still, Verizon's FiOS growth is impressive. The company passed 650,000 new premises in the second quarter, and broadband penetration among potential customers jumped from 23.5 to 28.1 percent. According to Verizon, the average FiOS customer bundles and spends more than $135 a month. All the while, FiOS installs get cheaper and faster, while Verizon continues to focus on wiring apartment complexes in DC, Philly, and New York. Verizon recently even raised prices on customers, increasing revenue per user on their deployment. There's few who'll argue that Verizon's FiOS investment was a necessity if the carrier wanted to remain relevant, with the exception of Sanford Bernstein expert "wrongologist" (and mainstream technology press quote machine) Craig Moffett. Moffett's been criticizing FiOS since its inception, and continues his chicken little routine by ignoring FiOS's healthy growth and telling Bloomberg that investors should run from the stock. quote: The enterprise business’s drop “suggests that we’re nowhere near out of the woods in this recession,” said Sanford C. Bernstein & Co. analyst Craig Moffett in New York. He expects Verizon’s shares to lag behind the rest of the market. Moffett is the only analyst surveyed by Bloomberg who advises investors to sell the stock.
You'll recall that Moffett's the same "expert" who thinks network upgrades are a bad idea, the incredibly profitable wireless industry is nearing collapse, and AT&T should eliminate unlimited $30 data plans. Unlike Moffett, most investors have come around to the idea that Verizon made the right choice to invest heavily in last mile fiber.Of course that investment has come with a human cost: to please investors like Moffett, Verizon has been selling its rural DSL networks to smaller carriers who've been unable to manage them. Meanwhile, to offset continued landline losses, the company says they'll need to lay off 8,000 workers in the second half of 2009. |
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Just waiting....until Verizon officially takes over AT&T and bring fiber to the home. I can dream, can't I? | |
| | openbox9 Premium Member join:2004-01-26 71144 |
openbox9
Premium Member
2009-Jul-27 12:00 pm
Re: Just waiting....T's EV: $219.53B VZ's EV: $154.26B
I think it's going to be a while. | |
| | | | | | | CorydonCultivant son jardin Premium Member join:2008-02-18 Denver, CO |
Corydon
Premium Member
2009-Jul-27 12:19 pm
Re: Just waiting....I'd say it probably depends on how long you plan on holding the stock for. Certainly not a good short-term buy based on the numbers you're supplying. But if you go with the assumption that fiber (or some substitute thereof) is the wave of the future, then sooner or later AT&T and the MSOs will have to invest in FTTH, while Verizon is already making that investment.
Once we reach that point, then we may very well see VZ in the catbird seat, just like cable has been milking the HFC investments they made several years ago. | |
| | | | | FFH5 Premium Member join:2002-03-03 Tavistock NJ 1 edit |
FFH5
Premium Member
2009-Jul-27 12:37 pm
Re: Just waiting....said by Corydon:I'd say it probably depends on how long you plan on holding the stock for. Certainly not a good short-term buy based on the numbers you're supplying. But if you go with the assumption that fiber (or some substitute thereof) is the wave of the future, then sooner or later AT&T and the MSOs will have to invest in FTTH, while Verizon is already making that investment. Once we reach that point, then we may very well see VZ in the catbird seat, just like cable has been milking the HFC investments they made several years ago. Yes, Verizon may be able to leverage better earnings from their fiber investments(but see my previous post to show why that is not a given). But I rebalance my portfolio every 6 months - plenty of time to watch their progress and invest prior to rapid stock price appreciation. | |
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| | | jjeffeoryjjeffeory join:2002-12-04 Bloomington, IN |
to FFH5
Yes, lets think short term. That's what we need more of. Screw our children and grand children. I am sick of people only think about the current quarter. I am sick of short term thinking. | |
| | | | | openbox9 Premium Member join:2004-01-26 71144 |
openbox9
Premium Member
2009-Jul-27 7:18 pm
Re: Just waiting....Fee free to invest however you choose. Nobody will stop you. And long term, you'll probably turn a decent profit. | |
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to jjeffeory
said by jjeffeory:Yes, lets think short term. That's what we need more of. Screw our children and grand children. I am sick of people only think about the current quarter. I am sick of short term thinking. Well, I guess you shouldn't have voted for Obama. | |
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| | | openbox9 Premium Member join:2004-01-26 71144 |
to FFH5
said by FFH5:It is a good HOLD stock, but not a BUY recommendation. The dividend is nice if you're looking for decent income stock. Otherwise I agree...if you own it, hold it, otherwise look elsewhere. | |
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Chuck Carlson to FFH5
Anon
2009-Aug-2 10:56 am
to FFH5
With the stock market indexes set to lose at least another 50 percent there will never be a better time to sell stocks in general. Stocks rarely make you money when indexes go down. In the long run you'll never beat the indexes. I'd wager money the stock markets will be sharply lower ten years from now than they are today. | |
| | | | | FFH5 Premium Member join:2002-03-03 Tavistock NJ 2 edits |
FFH5
Premium Member
2009-Aug-2 11:02 am
Re: Just waiting....said by Chuck Carlson :
With the stock market indexes set to lose at least another 50 percent there will never be a better time to sell stocks in general. Stocks rarely make you money when indexes go down. In the long run you'll never beat the indexes. I'd wager money the stock markets will be sharply lower ten years from now than they are today. But stock markets are going to be UP between now and mid 2010. Sell now and you will be giving up gains of 25 to 50%. As to 10 years from now - who knows. » news.morningstar.com/art ··· =2684014» news.morningstar.com/art ··· d=302122And what indexes are you basing this on? Just US indexes? Start thinking of investing in Foreign stocks & bonds. | |
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to openbox9
said by openbox9:T's EV: $219.53B VZ's EV: $154.26B I think it's going to be a while. Oh well, if that's the case, then I will be with Comcast for a long time. U-Verse looks like they are behind the times and they are not in a lot of neighborhoods in Georgia. | |
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to fatmanskinny
Not a chance. I'd pin Qwest as a likely takeover candidate however. At which point Verizon would upgrade ADSL2+ and VDSL nodes to FTTH, then probably sell the rest of Qwest's areas (the more rural ones that aren't getting either ADSL2+ or VDSL2) to Frontier, WIndstream or CenturyLink.
Besides, if Verizon bought AT&T antitrust lawyers would go wild, forcing another breakup. Additionally, Verizon is overbuilding AT&T in some areas with FiOS. | |
| | | openbox9 Premium Member join:2004-01-26 71144 |
openbox9
Premium Member
2009-Jul-27 7:29 pm
Re: Just waiting....said by iansltx:I'd pin Qwest as a likely takeover candidate however. Given VZ's desire to shed less profitable markets, I don't see VZ going after Q. said by iansltx:Besides, if Verizon bought AT&T antitrust lawyers would go wild Why? With exception of two markets, VZ and T don't compete. Plus, the telecom market is significantly different today than it was 25 years ago. | |
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Re: Just waiting....Re: Smaller markets, Qwest actually has a large amount of good-sized markets that Verizon could then take over (Denver, Colorado Springs, Phoenix, Salt Lake City). Again, the smaller stuff would likely get sold off to Windstream or CanturyLink, but anywhere Qwest is deploying ADSL2+ and/or VDSL are plenty big enough for Verizon's liking.
Also, Verizon would be able to grab a large IP transit network, consolidating the Tier 1 networks by a bit and netting Verizon control of large backbone customers like Charter Communications (who, granted, is building out their own netowrk now but isn't at Comcast or TWC's level yet). Would also give the former MCI/UUNet backbone a decent midwestern footprint.
Re: telecom situations, AT&T is now the largest landline company. Verizon is the largest mobile company, with AT&T not far behind. Seeing as how merging the entities would result in a company that has half as many mobile lines as there are people in the whole US...well, you see where I'm going.
Besides, Verizon and AT&T's business models diverge a bit. AT&T is all about milking current/past standards for all they're worth, locking in customers because they're the only game in town (iPhone, anyone?). Verizon tends to at least desire some "openness" spin, and their focus is clear: FiOS and wireless. They compete on features rather than price, whereas AT&T is forced to compete on price in many areas because cable can beat them with even DOCSIS 1.1.
Maybe I'm off-base here, but AT&T's everything-and-the-kitchen-sink mindset is quite different than Verizon's reliance on two core competencies to push itself forward. Qwest also now relies on two core competencies, though until a few days ago both were fading into the sunset. Now, with Qwest at least paying halfway attention to their internet business, they've got a leg to stand on that's pointed into the future. AT&T's efforts are merely to stay relevant, rather than to lead the pack... | |
| | | | | openbox9 Premium Member join:2004-01-26 71144 |
openbox9
Premium Member
2009-Jul-27 10:41 pm
Re: Just waiting....Decent thought, but I wouldn't buy Q based on the small potential of a takeover by VZ. said by iansltx:Qwest also now relies on two core competencies Q has relied on its only two competencies for quite some time. said by FloridaBoy:AT&T's efforts are merely to stay relevant, rather than to lead the pack... I'd suggest that Q's efforts are the same as T's | |
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iansltx
Member
2009-Jul-27 11:12 pm
Re: Just waiting....I'm not buying anyone's stock right now...not enough disposable income On Qwest's side, their VDSL2 service is competitive with anything cable can push out right now, as long as you're close enough to the DSLAM. AT&T U-Verse, for all its strong points, tops out at 18 Mbps down and 1.5 Mbps up. DOCSIS 1.1 can do that, let alone DOCSIS 3.0. | |
| | | | | | | openbox9 Premium Member join:2004-01-26 71144 |
openbox9
Premium Member
2009-Jul-28 5:52 am
Re: Just waiting....said by iansltx:AT&T U-Verse, for all its strong points, tops out at 18 Mbps down and 1.5 Mbps up. For now. Lets see what happens when/if they get line bonding working. | |
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mrkevinKnowledge comes, but wisdom lingers. Premium Member join:2007-08-07 Aurora, ME
1 recommendation |
mrkevin
Premium Member
2009-Jul-27 12:03 pm
copper and fiber?So Verizon brings Fios to your neighborhood. you decide not to get it. Verizon will still provide a copper loop, Dial tone, DSL? What a nightmare, maintaining two outside plants in the same area. I feel bad for the Verizon techs...(no not really) | |
| | FFH5 Premium Member join:2002-03-03 Tavistock NJ |
FFH5
Premium Member
2009-Jul-27 12:35 pm
Re: copper and fiber?said by mrkevin:So Verizon brings Fios to your neighborhood. you decide not to get it. Verizon will still provide a copper loop, Dial tone, DSL? What a nightmare, maintaining two outside plants in the same area. I feel bad for the Verizon techs...(no not really) That is a significant problem you have pointed out. Maintaining dual access(copper & fiber) in most neighborhoods is an unneeded extra cost. I would suspect at some point that Verizon will ask the FCC & the state PUCs for permission to terminate all copper plant in Fios covered areas. And wait till the screaming starts then!!! | |
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Re: copper and fiber?I agree. it is only a matter of time before the copper phone lines will be removed from the poles. I wouldn't be surprised if they are forced to do a hack job doing a fiber+powerold copper line at the pole to appease a very small small minority. | |
| | | mrkevinKnowledge comes, but wisdom lingers. Premium Member join:2007-08-07 Aurora, ME |
to FFH5
said by FFH5:said by mrkevin:So Verizon brings Fios to your neighborhood. you decide not to get it. Verizon will still provide a copper loop, Dial tone, DSL? What a nightmare, maintaining two outside plants in the same area. I feel bad for the Verizon techs...(no not really) That is a significant problem you have pointed out. Maintaining dual access(copper & fiber) in most neighborhoods is an unneeded extra cost. I would suspect at some point that Verizon will ask the FCC & the state PUCs for permission to terminate all copper plant in Fios covered areas. And wait till the screaming starts then!!! Doesn't Verizon own the plant? can't they just say "hey we're done with the copper, if you want service from us, we will provide DT but through the fiber" as long as you are getting the same service what does it matter how it's delivered? the people screaming probably miss:milkmen Ice boxes black and white TV VCR's vinal records | |
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vinnie97
Premium Member
2009-Jul-27 2:34 pm
Re: copper and fiber?vinyl records are still a joy to use, even in the underground nightclub DJ circuits (and were still in use regularly up until this decade...with use only leveling off now thanks to the digital revolution). | |
| | | | | mrkevinKnowledge comes, but wisdom lingers. Premium Member join:2007-08-07 Aurora, ME |
mrkevin
Premium Member
2009-Jul-27 2:55 pm
Re: copper and fiber?said by vinnie97:vinyl records are still a joy to use, even in the underground nightclub DJ circuits (and were still in use regularly up until this decade...with use only leveling off now thanks to the digital revolution). Yah, you're right. But you can't buy them at Walmart. | |
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vinnie97
Premium Member
2009-Jul-31 6:18 pm
Re: copper and fiber?Thank goodness. | |
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to mrkevin
I would think the state PSC's would give a big no to that. Going to all fiber would lock out what few CLEC's are left and noone in government wants that. | |
| | | | | mrkevinKnowledge comes, but wisdom lingers. Premium Member join:2007-08-07 Aurora, ME |
mrkevin
Premium Member
2009-Jul-27 2:54 pm
Re: copper and fiber?said by FloridaBoy:I would think the state PSC's would give a big no to that. Going to all fiber would lock out what few CLEC's are left and noone in government wants that. I never thought the CLEC angle... couldn't they just "abandon" it to the CLEC.? Don't most CLEC's co-locate their equipment? So a CLEC could stymie a whole area from going fiber just because they didn't want to upgrade (cost, other)? | |
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Re: copper and fiber?Mrkevin,
Co-locating is a little out of my realm. I am sure we have guys here who can comment on that.
As for abandoning it to a CLEC, I can think of a couple of reasons they would not be able to do this.
First, since the CLEC uses Verizon techs to "fix" any problems, I cant imagine any CLEC suddenly wanting to hire a work force to take care of copper plant that is just going to bleeed customers anyway.
Second, think of the how much copper is in the ground. If you were Verizon, would you give up tons of copper that could still be financially valuable if you get a chance to pull it up out of the ground and sell it on a metal market?? Nope, I just cant see them doing that for the CLEC's. | |
| | | | | | | mrkevinKnowledge comes, but wisdom lingers. Premium Member join:2007-08-07 Aurora, ME |
mrkevin
Premium Member
2009-Jul-27 3:55 pm
Re: copper and fiber?First, since the CLEC uses Verizon techs to "fix" any problems, I cant imagine any CLEC suddenly wanting to hire a work force to take care of copper plant
Does the CLEC share in the maintenance costs? If so, there are companies out there that do contract utility maintenance. Second, think of the how much copper is in the ground. If you were Verizon, would you give up tons of copper that could still be financially valuable if you get a chance to pull it up out of the ground and sell it on a metal market?? Nope, I just cant see them doing that for the CLEC's.
I'm just saying if the Public Services Commission wouldn't let them pull it out. | |
| | | | | | | openbox9 Premium Member join:2004-01-26 71144 |
to FloridaBoy
said by FloridaBoy:First, since the CLEC uses Verizon techs to "fix" any problems, I cant imagine any CLEC suddenly wanting to hire a work force to take care of copper plant that is just going to bleeed customers anyway. Gee, of course a competitor doesn't want to hire a workforce. Therein lies a problem with the CLECs. If they'd started building out their infrastructure, we might not have some of the competitive issues that people complain about today. said by FloridaBoy:Second, think of the how much copper is in the ground. If you were Verizon, would you give up tons of copper that could still be financially valuable if you get a chance to pull it up out of the ground and sell it on a metal market?? Copper is on its way back up, but it's still not where it was a couple of years ago. Abandoning the copper in place is probably more profitable to VZ right now considering the current copper prices. | |
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to mrkevin
FiOS has been available on my street for 2 years now. My neighbor called about DSL because he was trying to save money (at the time they had a very low price promo for DSL) VZ would not sell to him, they only offered FiOS service. | |
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to mrkevin
said by mrkevin:So Verizon brings Fios to your neighborhood. you decide not to get it. Verizon will still provide a copper loop, Dial tone, DSL? What a nightmare, maintaining two outside plants in the same area. I feel bad for the Verizon techs...(no not really) The Union loooovess Copper and Fiber plants in the same place!!!! | |
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to mrkevin
VZ will not sell DSL *at all* in any area where FIOS is available (however, they *will* sell FIOS bundles of broadband and phone, broadband and TV, or all three, with or without wireless; DSLExtreme will sell dry-loop FIOS). Also, where FIOS is being deployed, it can (and does) obviate the need for VZ to sell any form of xDSL (especially in areas where it has never sold it, or had low sales of same). The real problem for VZ's techs is the certainty of copper Going Away. If you aren't willing to learn fiber, your career advancement path is going to come to a rather abrupt halt. | |
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baineschile2600 ways to live Premium Member join:2008-05-10 Sterling Heights, MI 1 edit
1 recommendation |
Though most people love itquote: Unlike Moffett, most investors have come around to the idea that Verizon made the right choice to invest heavily in last mile fiber.
Though people, especially on this website, love the Fios service, it still hasnt and we wont know it to be a "good investment" for many years. Their net income was 1.48 billion; they are investing ~23 billion over the next 10 years to run FTTH, which is a HUGE capital cost. The main factor will be how powerful the lte/wimax/5th gen wireless becomes. There may not be a need for a wired connection in the future, which would make the investment a poor one. | |
| | •••• | ·Frontier FiberOp..
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Verizon will weather this stormThey market FiOS hard in NYC, and the super polished ads are catchy enough to woo even the dumbest customer in.
I think Moffett's point is that the investment needed to roll this out is initially cost-prohibitive considering the promotional price points available to the consumer, and I suppose he's right to that extent considering the current penny-pincher mentality of everyone hit by the recession.
What Moffett's short-sighted mentality doesn't acknowledge is that consumers want faster and cheaper and don't care who to get that from, and that's Verizon's job to be "it." | |
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problemThe problem with verizons handling of fios they are cherry picking where fios gets installed.
Even here on long island in the same village they are only installing fios on certain blocks.
So I think verizion might have a tough time making its money back on this since they are slowly giving up customers buy only putting fios on certain blocks and not keeping up with their dsl network that customers who dont have fios on their block can access. | |
| | •••• | ajc18aka IGnatius T Foobar join:2000-05-06 Mount Kisco, NY |
ajc18
Member
2009-Jul-27 2:53 pm
FTTH is the future, and a good investment.AT&T and Qwest are going to have to upgrade to FTTH eventually. There's only so much bandwidth that you can squeeze out of an old copper pair, even at short distances. U-Verse is already obsolete. They're very close to maxing out the capacity of VDSL. The reason? AT&T saw U-Verse as a telephone-and-Internet play. They saw it as "we're going to offer the fastest DSL in the industry." They weren't forward-thinking enough to anticipate that digital television was going to be part of the picture.
Verizon was forward-thinking enough to realize that if they replaced their aging copperplant with fiber, they could offer digital television service along with voice and data, and still have bandwidth to spare. FiOS is a long term investment. They got a hundred years out of the copper plant. They're not going to replace it with something that will be obsolete in less than a decade.
Cable ate telco's lunch by offering fast Internet and cheap voice. Now it's telco's turn to eat cable's lunch by offering a better television service. Verizon is well positioned to do this. AT&T isn't. It's a good investment. | |
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Re: FTTH is the future, and a good investment.AT&T is cutting corners by deploying FTTH in new neighborhoods and developments, while continuing to use copper in existing neighborhoods. Kinda like how VZ is cherry picking. Both want deployment costs to go down so they can put FTTH in more areas. | |
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Verizon and NYCHAHere's a question. Do you guys think Verizon will actually deploy fiber in the projects? By the way for you outsiders, NYCHA stands for New York City Housing Authority. Will they bring fiber to the ghetto? lol. Have they actually done so in other areas throughout the country or no? | |
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anon007
Anon
2009-Jul-28 8:31 am
Re: Verizon and NYCHAVerizon is the cherry picking type, if people in NYCHA have an income higher then 50,000 yeah if not, don't hold your breath . And don't do the math ofcourse is the later one ppl that live in NYCHA income is lower then 26,000 that mean Verizon is not intrested soo you will be serv last. | |
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to NJBoricua75
They installed Fios in the projects in Florida | |
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Power Lover
Anon
2009-Jul-27 7:00 pm
Time for broadband over power lines.Eventually broadband over power lines will come into the picture due to the lack of attention to rural areas. Just a matter of time. | |
| | THoff join:2004-01-15 Santa Monica, CA |
THoff
Member
2009-Jul-27 7:34 pm
Re: Time for broadband over power lines.Not until there is a viable BPL technology. What's available has been a technical nightmare and under-delivered. It may be good enough to replace DSL, but it can't be used as a substitute for FTTH. | |
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WatchingItRot
Anon
2009-Jul-27 7:52 pm
Verizon copper linesI'll tell you how verizon is going to get all of their customers off of the copper in fios covered areas. Verizon is not spending a dime on the copper plant, chosing to let it rot in place. Then when it gets so bad no service ( hsi, dsl, pots ) will run on it, Verizon will go to the fcc and tell them it will cost billions to repair or replace and the fcc will give the ok to move everyone to fios. | |
| ReVeLaTeD Premium Member join:2001-11-10 San Diego, CA |
ReVeLaTeD
Premium Member
2009-Jul-27 11:26 pm
Better question...When is Verizon going to deploy FiOS consistently in areas where it exists instead of the current swiss cheese deployment (most commonly in new buildout areas where they had it easy)?
Case in point: 4S Ranch has it. Down the street does not. Literally, walking distance. If you're going to activate an area, activate the entire friggin zip code.
I totally want FiOS for internet, but for some reason Verizon doesn't want my business. | |
| altermatt Premium Member join:2004-01-22 White Plains, NY |
Impressive ;)I can see the ads now..."3.1 Million Customers, and not a single correct first bill in the bunch!" I am only ing now that it's three months and I finally got a correct bill. | |
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