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US fixed-line market stabilising despite moves to mobile

12 мая 2010

Moody's revealed that it will maintain a stable outlook on the North America wireline sector as telecoms companies start to hit back against competition from cable and benefit indirectly from the trend towards mobile services. 

The downward trend in the residential sector continues, but fixed-line players are adapting to their surroundings, Moody's said, noting that the telcos have succeeded in matching efforts from the cable companies in terms of broadband and video offerings.

"Although telcos have recently been losing the flow share battle of new high-speed broadband customers relative to cable, we expect the competitive dynamic to ebb and flow in the future based on promotional pricing," said Gerald Granovsky, Moody's VP-senior credit officer.

"[In addition,] companies continue to aggressively cut costs as improvements in operating support systems and prior network investment lead to efficiency gains," said Moody's senior vice president Dennis Saputo.

Declines in access lines are continuing, as customers disconnect their fixed-line phones and go mobile-only. However, these declines are slowing, Moody's said.

Furthermore, "the wireline carriers also stand to benefit from the growing adoption of wireless broadband, as the vast majority of the end-to-end traffic of wireless networks travels on the wireline segment," the company added.

There are also positives for fixed-line players in the business and wholesale markets, where Moody's said has identified "signs of stabilisation" on the back of increased traffic volumes.

"On the business side, we expect wireline telecoms to leverage the significant reach advantage of their networks to carry the ever-growing Internet traffic and do not expect cable to materially impact the enterprise and wholesale business over the next 12-18 months at least," Granovsky concluded.

Источник: Total Telecom

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