The RBOC advantage, is of course, incumbency. But those carriers also seem to have something to sell customers, no matter what a customer decides regarding local calling, long-distance calling, wireless service, data service, and/or, as announced recently, satellite TV service (see SBC's EchoStar Pact: For Real?).
Investors, however, don't appear terribly hot or cold to the recent earnings news. The Dow Jones Telecom Index, which comprises all the major U.S. carrier stocks, was down $0.92 (0.81%) to $112.63 in early afternoon trading on Tuesday.
Though the company is aggressively moving on its DSL strategy, its consumer voice revenues dropped more than 30 percent from a year ago. Its retail business voice revenues also dropped at a high single-digit rate, and its wholesale voice revenues fell more than 20 percent from the year-ago period.
On Wall Street, there's much back-and-forth about whether AT&T is a choking business with limited upside, or a gem that is undervalued and misunderstood. "Overall demand for telecom services remains weak, but AT&T continues to execute by taking market share from distressed competitors, attacking incumbent LECs, and ripping costs out of its model," writes Kaufman Bros. LP analyst Vik Grover, in a research note published last week.
Grover is right about Ma Bell attacking competitors. She's been trashing MCI/WorldCom (Nasdaq: MCIT) for more than a year now, and it doesn't look to let up (see MCI's 'Creative Routing' and AT&T's Dorman Weighs In on WorldCom).
In contrast to the IXCs, the RBOCs continued with decent revenues and big quarterly profits.
Nothing new was said on the labor negotiations front, which could affect more than 78,000 of Verizon's domestic workers. The company's labor contracts with the union representing those workers expire at midnight on August 2.
Other carrier earnings reported of late include:
- France Telecom Q2 Profits Rise (Maybe)
- Tyco Q3 Revenues Rise
- Telus Quadruples Q2 Income
- Equant Cuts Q2 Loss
- Wanadoo 1H Revenues Rise
- Alltel Hits a Homer in Q2
- Level 3 Slides Into Q2 Loss
- Colt Q2 Revs Rise, Loss Widens