You’d think it might make a bigger local headline, but buried somewhere in the business section on the Seattle Times website home page is news that Qwest is being acquired by CenturyTel in a $10.6 billion stock swap combining the nation’s third and fifth largest landline companies respectively. (The New York Times by comparison, currently has the headline front and center on their home page, just below the top story.)
Why is this such big news? Well, first of all, combined with the recent acquisition of Verizon’s local landline business by Frontier, just about all of the landlines in Washington state will have changed corporate hands, along with a large chunk of residential and business broadband connections. The merger will also surely result in numerous layoffs in Washington and throughout Qwest’s mostly Western territory, as the two companies consolidate operations.
Second of all: CenturyTel Field. Get used to it.
The landline business has been shrinking for years as residential customers shed their home phone lines in favor of wireless, and cable companies like Comcast have eaten into what should have been a dominant position in broadband. But Qwest has never made the investment in high-speed broadband infrastructure necessary to keep customers in the fold, and so they’ve paid the price as they’ve watched their market steadily wither.
I’m one of those Qwest CenturyTel customers the merged company risks losing. I’ve never subscribed to cable, so can’t be tempted by a Comcast bundle, and live only a few blocks from a switch, so I receive advertised broadband speeds via distance-sensitive DSL. But Clearwire is installing a tower a block away, promising fast, reliable wireless broadband, so with three broadband providers offering apples to apples service, I’m willing to shop around on price.
When I moved into my house 13 years ago we had three land lines installed (home, business and fax) plus ISDN. Now I have one basic landline — no extra features, no voicemail, no nothing — plus DSL. In fact, the only reason I keep the landline at all is the desire to have reliable 911 service in a house with a child.
The irony is, the residential phone companies like US West Qwest CenturyTel were in the perfect position to dominate broadband at he birth of the Internet age, but refused to make the kind of infrastructure investments that have allowed much of the rest of the world to leapfrog the U.S. in broadband speed. While the average Japanese consumer enjoys speeds in excess of 60 mbps, most of us out here in Microsoftland are still dreaming about joining the French in the 20 mbps range.
And I’m not sure the Qwest/CenturyTel merger signals anything except the intent to continue milking their existing customers for as long as they can, even as we flee to newer, cheaper, and hopefully faster technologies.