The rule in question requires that landline telecommunications providers "restore outages within certain time frames and provide billing credits to customers when they fail to do so." CenturyLink asked for exemption from this rule earlier this year. However there are already exemptions in place. For example if the outage occurs on a weekend, or is the result of a natural disaster or a result of the actions or inaction of a user, then the company will not be responsible for repairing the outage in the specified 24 hour time-frame.
CenturyLink effectively argues that the rule is outdated. It was instigated in a time before broadband connections. CenturyLink feels that it is now wasting valuable time restoring outages in order to meet the requirements of the rule when it should be installing broadband for consumers. This is what people really want these days, anyway, and the company feels that this will give competitors that are not governed by the rule, such as those that are solely wireless providers, an unfair advantage in terms of the speed with which they are able to bring the service to their customers.
If the company is successful in receiving exemption from the rule it will be able to focus on broadband installation and in the long run this could mean good things for the stock. Rather than complete exemption, though, it appears that a compromise has been reached. This is in everyone's interests. CenturyLink will be able to devote more time to broadband installations while those users without access to the internet will not have to suffer when there is an outage. The compromise has the following terms: now CenturyLink has 48 hours in which to repair the outage and the customers will not receive billing credits if they fail to do so. However 80% of outages are required to be fixed within the specified time frame.
To me, this shows that the company is devoted to ensuring that everyone has broadband. This is clearly something that is financially important for the company itself, but I feel that it also shows that the company has the best interests of its customers at heart as they will also be able to receive the services that they need. It is really just a ploy to stay ahead of the competition if possible, and you cannot blame the company for trying.
Two of CenturyLink's main competitors, namely Verizon (NYSE: VZ) and AT&T (NYSE: T), are competing for the right for the first company to successfully introduce shared-data plans. The reason they are taking their time introducing this new method of providing a pricing data is that, if they get it wrong, the entire scheme could end up costing them. Consequently neither company wants to necessarily be the first to get involved in that regard. However, the company that it gets it right first stands the chance of making a lot of money. There really is a lot of cash at stake here.
This means that the two companies are struggling to decide whether or not it is worth the risk. The new pricing plans will effectively allow consumers to buy one data package that they will be able to use to power all of their devices, including their iPads, computers, phones, etc. It will be faster and more economical for all consumers involved. Regardless what company gets there first it is clear that CenturyLink, at his point in any case, is not a serious competitor regarding this new pricing scheme that will soon come to light.
In some ways, Sprint (NYE: S) is not doing so well. Although it finds it easy to keep customer loyalty by offering the best customer satisfaction, it is losing ground in Kansas City, its hometown. Basically what's happened is that the company's main competitors in this town have introduced a "4G service ... using Long Term Evolution, or LTE, technology." Sprint has a lot to do to catch up with its competitors in this specific area, and I think that it may be too little too late. We will have to wait and see if it is up to the challenge. With Sprint focused on catching up, it may not pose much of challenge to CenturyLink where they overlap in product.
AT&T will probably also lose a lot of customer loyalty in the coming weeks following a report that states that it is one of the mobile carriers that is vulnerable to hijacking. Basically it appears that hackers can hijack the internet connection on smartphones that have a certain firewall that tends to be favored by mobile service providers. If a hacker gains access to your connection in this way, he or she can take control of your activities and threaten the safety of your data connection. Unless the company finds a way to counteract this it could be in serious trouble, and its stock may suffer the consequence.
Cablevision (NYSE: CVC) really wants to spread its wings and make a real impact on the market. I say this because in most recent news Cablevision "is looking for an executive to help it deliver video content to connected TVs and gaming consoles." This will make the company a genuine competitor for Microsoft (NASDAQ: MSFT) which already has the Xbox, which serves a similar purpose to what Cablevision hopes to achieve. If the company successfully manages to compete with Microsoft at a meaningful level it may just be able to come out on top one of these days. This news was inferred from a job posting that the company put up. The job listing advertises for someone who will be able to oversee "all project development activities for Cablevision's embedded device platform environments." A potential war between these cable providers may do damage to one, if not both companies. Certainly their attentions will be turned against each other and outsiders like CenturyLink can sneak more away with more market share.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.