AT&T Earnings Down 23.6 Percent - A Good Thing?
January 28, 2009
AT&T stock is down on news that earnings took a 23.6 percent tumble in the recently reported quarter. 
However, the earnings were largely affected by strong sales of the iPhone which AT&T subsidizes at a hefty cost and increased costs from operations.
AT&T added 1.9 million new iPhones in the 4th quarter, 40% of which were new customers to the AT&T network. Average iPhone usage is 1.6 times higher than other AT&T phone subscribers, likely to be a long term win for AT&T once it gets past the initial pain of phone subsidies.
With the recently announced layoffs of 12,000 workers, AT&T will also suffer short term severance expenses but will benefit from overall lowered costs in future quarters.
What is being interpreted as bad news by Wall Street today may result in better numbers for the death star company in the future.
Cyber Advisor A Cyborg Of The Times
January 22, 2009
In what is surely a sign of the times, the Obama administration will appoint a national “Cyber Advisor” who will report directly to the president. While the term “Cyber” is already dated, the idea of focusing efforts to track Internet security and related threats is a much needed adjustment for the Department of Homeland Security.
Much of the world’s business and communications now occur through the Internet, it is about time that the government take “Cyber” threats seriously and develop a strategy to fight not only the specter of terrorism online but data and network security, spam, phishing, identity theft, denial of service attacks, and a host of other schemes which are increasingly making Americans unsafe while online.
The only thing that could improve this welcome news would be coming up with a better name for the office. “Cyber Advisor” sounds a bit too much like your grandmother explaining Arnold Schwartzenegger’s part in the last Terminator movie. Does anyone really use the term “Cyber” any more? Move over Sarah Connor, there’s a new Cyber Advisor in town.
Nortel Files Bankruptcy
January 14, 2009
At the end of December, we wrote about Nortel’s race to zero, today we hear word that the company has filed Bankruptcy protection in Canada, the US, and Europe along with several of its affiliates. It will be a struggle for Nortel to reorganize and return from the stiff requirements of bankruptcy in this economy. Nortel hasn’t see truly happy sales numbers since the late 90s. Today, it faces competitors which offer similar services at dramatically lower prices.
The news comes as a big blow to the Canadian economy where Nortel was once worth 35% of the Toronto Stock Exchange. Today, the company faces the very real possibility of being delisted from the exchange.
The Telecom Zombies of 2008
January 8, 2009
I hate top ten lists, don’t you? They are like zombies from the past which occasionally rise from the dead to eat our brains.
Yet, here I find myself, dirty shovel in hand, writing out a list of last year’s top telecom news items - inked in the blood of the victims of 2008.
Last year, we learned not to listen to PR flacks. Like innocent lambs to the slaughter, the top telecom companies and equipment manufacturers spent the early part of the year denying any effects from the rapidly decaying economy but found themselves impaled on the sharp hook of 2008 in the final weeks of the year, desperately struggling to break free by laying off employees, cutting costs, looking for money, or preparing for bankruptcy (in some cases, all of the above). Along the way, the telecommunications landscape was radically changed, groundwork was laid for a new future, and a new president was elected who will likely change the Federal Communications Commission forever.
We look forward to burying 2008 once and for all with this final look back. And please stand clear of the zombies - Por favor permanezca lejos de los zombis:
Carriers Tricking Customers Into Upgrading With Crappy Service?
January 6, 2009
Are the big telecoms punishing their customers for failing to upgrade to next generation services? Ed Gubbins of Telephony Online details the tactics that some carriers may be using to get customers to upgrade.
Gubbins claims that Verizon may be neglecting DSL as it rolls out fiber. That Qwest DSL customers may be receiving interference from the new Fiber-To-The-Node (FTTN) network and that a best way to resolve the issue is to upgrade to FTTN. And that AT&T may be favoring the 3G wireless network over 2G and may also be pushing users on to U-Verse as a way of resolving issues with DSL.
While Mr. Gubbins doesn’t have any hard proof, the allegations are interesting and worth keeping tabs on. Carriers certainly can’t afford to build out new networks if customers don’t switch to the newer services. If old services cost less, why switch? Unless the older service suddenly stops working as expected. He makes a good point.
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