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Qwest Markets Not Getting IPTV – Yet

CenturyLink Inc. (NYSE: CTL) execs say the company is already moving aggressively to recapture enterprise business Qwest Communications lost to CLECs and cable companies, but won't decide until mid-year where, and whether it will roll its Prism IPTV service out in the former Qwest territory.

In announcing first-quarter earnings today, CenturyLink CEO Glenn Post said the company is "pleased with the progress" that Prism TV is making elsewhere, where it contributed to a 2 percent increase in broadband customer ARPU. (See CenturyLink Earnings Up, But Headed Down?)

For the newly acquired Qwest customer base, however, the immediate effort will be to duplicate what CenturyLink has done with many of the Embarq markets it acquired -- that is, focus on new customer acquisitions and higher rates of retention, according to Post and COO Karen Puckett. (See Merger a Boon to CenturyLink Business?)

"We expect to regain market share -- the opportunity is there," Post said.

CenturyLink is making "significant changes" to the go-to-market strategy in the former Qwest markets, including changes in relationships and compensation with agents, and those market plans are now in place for each of its market regions, Puckett said.

"We are getting more local -- competing with the CLECs and cable companies who have been taking market share from Qwest," Puckett said.

As for rolling out IPTV to former Qwest markets, those decisions will take more time and be influenced by the cost of pushing fiber closer to customers, Post said. Prism TV will pass 1 million homes by the end of the year elsewhere in CenturyLink-land.

"We do not expect any additional IPTV rollouts in new markets," he said. "We are working to accelerate the [penetration of the service] in the existing markets. We will be evaluating the Qwest markets in the coming months. We are in the process of working through the costs and plant requirements, shortening of loops that will be needed, and we expect to make the decision mid-year."

CenturyLink will be investing about half-a-billion dollars in building out local fiber, if FTTN and fiber-to-the-cell tower investments are combined. That's out of a total capital budget of $2.6 billion.

— Carol Wilson, Chief Editor, Events, Light Reading

cnwedit 12/5/2012 | 5:05:57 PM
re: Qwest Markets Not Getting IPTV – Yet

I wouldn't say the are putting IPTV on the back-burner - they closed the deal April 1 and are promising IPTV decision mid-year, which is only a couple of months away.


There are complex issues to consider, however, including whether Qwest's FTTN buildout can deliver the PRISM IPTV service, or whether the local loops need to be shorter.


I do get the sense that they aren't IPTV barnburners, however. The news today was no new IPTV markets, but a bigger effort to sell IPTV where they do offer it. In the first quarter, CL didn't even spend the money it budgeted on marketing IPTV because it didn't have to - the customers came without heavy persuasion. Now, the company sees it will start heavier marketing.  

Jeff Baumgartner 12/5/2012 | 5:05:57 PM
re: Qwest Markets Not Getting IPTV – Yet

Guess I'm not surprised they're putting IPTV on the backburner in the Qwest markets for the moment, though it would definitely make things a bit more interesting here in the Denver area, where Comcast is the cable TV incumbent.  Qwest offered IPTV in Highlands Ranch, CO, back in the day, but it didn't have much of a competitive effect here among the few homes that could actually get it. And it didn't raise much of a stink among the few folks who were signed on when Qwest scuttled the thing a couple of years ago.  Around here, it seems like CenturyLink is viewed as a welcome, fresh face and will likely enjoy a honeymoon period, so they shouldn't sit on their hands on this kind of stuff for long.  JB

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