Wed, Jun. 17, 8:12 PM
- In an audit that New York City plans to release tomorrow, the city slams Verizon (NYSE:VZ) for failing to deliver FiOS fiber connections to anyone who wanted them, a promise the company made in 2008.
- In signing a franchise agreement with NYC then, Verizon said all comers would be served by 2014 -- but there are more than 40K requests for service and about three-quarters of those have been outstanding for 12 months or longer, according to the audit.
- Verizon, meanwhile, says the main reason buildings don't have service is in its struggle to get access from landlords.
- Lowell McAdam's ascension to the CEO role four years ago has seen the company focus on its wireless operations, and sell off wireline assets in three states as well as stop plans to build FiOS in new territories.
- A Verizon spokesman says the company's invested $3.5B in the city's FiOS network and that Verizon and the city both want more people on it. He said the audit appeared to be politically based, linked to the city's upcoming union negotiations.
- Previously: Union accuses Verizon of leaving landlines broken (Jun. 09 2015)
- Previously: Citigroup: Altice's next move may be $34B in Verizon wirelines (Jun. 03 2015)
Mon, Jun. 15, 7:30 PM
- Verizon (NYSE:VZ) isn't looking to sell the Huffington Post, CFO Fran Shammo says. And despite the company's move into video, it's not interested in buying spectrum-rich Dish Network (NASDAQ:DISH) either.
- Speculation recently has centered on whether AOL's content assets, which include HuffPost as well as TechCrunch, were a fit in a $4.4B Verizon acquisition deal said to be focused on AOL's ad technology.
- Shammo said Verizon likes all of the AOL portfolio and hopes to keep it together. As for spectrum, he says if Verizon wanted more, it would have bought more at the last FCC AWS-3 auction.
- Previously: Not the old AOL: Verizon purchase all about ads (May. 12 2015)
- Previously: Report: Amid Verizon talks, AOL exploring Huffington Post spinoff (May. 12 2015)
- Previously: Verizon scoops up AOL for $4.4B (May. 12 2015)
Fri, Jun. 12, 5:19 PM
- Today in telecom consolidation speculation: While Dish Network (NASDAQ:DISH) and T-Mobile (NYSE:TMUS) have been talking about a deal with upsides for both (and shareholders have driven DISH up 2.6%, TMUS up 1.8% since word broke June 3), they aren't each other's only option.
- And much of what transpires there depends on T-Mo parent Deutsche Telekom (OTCQX:DTEGY) and what it wants to do with an asset that can command top dollar as perhaps the last attainable big U.S. cell provider.
- “They’re obviously controlled by a German company who has strategic initiatives, both in Europe and the United States, and they may not be in a position where they want to do anything," Dish chief Charlie Ergen said in a Bloomberg TV interview.
- From Dish's perspective: It doesn't need to rush, as it's making free cash flow and has time to sit on its large spectrum stockpiles yet. Ergen could look for a sale to Verizon (NYSE:VZ), or break the spectrum off into a separate company with a sale-leaseback. In any case, many deals that seemed well under way have been kiboshed by the mercurial Ergen.
- Fron T-Mobile's: Deutsche Telekom is reportedly worried about an overvalued Dish and getting too much of that stock. T-Mobile could probably command $49/share in a sale, or a 25% premium, says Gabelli's Sergey Dluzhevskiy. One company that wouldn't blink at that price would be Comcast (NASDAQ:CMCSA) in its own quad-play grab.
- Altice (OTC:ATCEY), which considered a run at Time Warner Cable (NYSE:TWC), could be a long-shot for T-Mobile, or even Charter (NASDAQ:CHTR). And with AT&T expanding in Mexico, how interesting would it be if América Móvil (NYSE:AMX) pumped up its U.S. presence with Big Magenta?
Thu, Jun. 11, 5:18 PM
- With just hours to go before the FCC was to begin enforcement of new net neutrality rules, a federal appeals court has declined to stay them in a blow to telecom firms that hoped to block them while litigation plays out.
- The rules are set to go into effect tomorrow. The plaintiffs argue that they do not object to some of the regulations, like bans on blocking/throttling and paid prioritization, but they are fighting vigorously against Title II classification, which would mean regulating broadband as a tightly controlled telecom service.
- Represented/related companies: VZ, TMUS, S, CMCSA, CHTR, TWC, CVC, CTL, FTR, CCOI, DISH, DTV
- Previous coverage on net neutrality
Tue, Jun. 9, 10:20 AM
- Verizon's (VZ -0.4%) biggest union, the Communications Workers of America, is saying that the company is refusing to fix broken landlines in the Northeast, instead steering customers to wireless Voice Link home phone service.
- The union is filing requests with regulators to try to uncover data about the extent of the problem.
- Verizon says the union is simply applying pressure ahead of contract talks later this month -- "It’s pure nonsense to say we’re abandoning our copper networks," a spokesman says -- but the complaints echo some from Hurricane Sandy, when Verizon was criticized for offering customers a complaint-plagued Voice Link while trying to avoid fixing copper damaged by the storm.
- As with other telecoms, Verizon has expressed a desire in the past to shut down its dwindling copper line system and replace it with cheaper and faster alternatives, namely wireless and fiber. The union acknowledged, though, that Verizon investing more in copper means more union jobs.
- Verizon invested $5.8B in wirelines last year, down 7.7% Y/Y. The company has about 10.5M residential landline customers, about half of which are on copper.
Fri, Jun. 5, 5:39 PM
- The current wisdom holds that Dish Network (NASDAQ:DISH) and T-Mobile's (NYSE:TMUS) combination bid might have a relatively easy time with regulators, and it shouldn't face debt problems either, says one analyst.
- “Dish bond covenants are very loose,” says Covenant Review analyst Scott Josefsberg, and the satellite provider would have “wide latitude to structure a transaction." Meanwhile, T-Mobile covenants allow for the firm to issue at least $10B more in debt. Dish Network has an enterprise value of $45.8B; T-Mobile's is $52.9B.
- Meanwhile, Citigroup's Michael Rollins says the other option is clear for spectrum-rich Dish: Sell itself to Verizon (NYSE:VZ).
- He thinks that's the likely outcome for a number of reasons, including the need for Verizon to keep up with AT&T/DirecTV, the spectrum shortage that Verizon currently faces heading into next year's incentive auction, and the chance for Dish to make a shift to IP video to "dramatically" increase magnitude and duration of video cash flows.
- He has Dish and T-Mobile rated at Buy and raised T-Mobile's price target to $46, while maintaining Dish's target at $94. Today: DISH +1.7% to $75.51; TMUS +2.3% to $40.24; VZ -1.8% to $47.25.
Thu, Jun. 4, 11:41 AM
Wed, Jun. 3, 1:01 PM
- With an acquisition deal for Suddenlink in the rear-view mirror, France's Altice (OTC:ATCEY) might have its eye on a much bigger move into the U.S.: a purchase of Verizon's (NYSE:VZ) residential wireline business, including FiOS TV/Internet.
- That's according to Citigroup's Michael Rollins in his latest report. "While press reports suggests many in the market believe Cablevision is Altice's next acquisition, we believe an acquisition of Verizon's local wireline operation (excluding the enterprise and smaller strategic business units) is more likely," Rollins writes.
- Verizon sold local wireline operations in three states to Frontier Communications earlier this year. Verizon's remaining assets in that business could bring $34B, Rollins estimates.
- Altice, owner of Numericable and SFR in France, has aimed to merge those TV and wireless firms with Bouygues Telecom (OTCPK:BOUYY), to bring France's wireless market down to three major firms, but Bouygues has said nothing's in the pipeline.
- "A sale of Verizon's remaining (local) operations could accelerate the reduction in financial leverage without meaningful dilution to free cash flow per share," Rollins says. "Such a move would also increase flexibility for Verizon to more aggressively pursue spectrum purchases and further scale for its emerging wireless, over-the-top video strategy."
Tue, Jun. 2, 6:46 PM
- Mogul John Malone floated an interesting idea today: Forget Sprint and T-Mobile -- the wireless industry could get its third major alternative to Verizon and AT&T (NYSE:T) with the merger of Charter Communications (CHTR -1.6%) and Time Warner Cable (TWC -0.9%).
- Malone was speaking at his various Liberty companies' annual meetings and noted that in 2012, the cable consortium SpectrumCo got an option to participate in a wireless MVNO service with Verizon (NYSE:VZ) after the wireless firm bought $3.9B in frequencies.
- Charter wasn't in SpectrumCo then, but merger partners TWC and Bright House are. “The concept that Comcast, a greatly enlarged Charter and Cox could together offer a WiFi-optimized connectivity service with a default to a Verizon MVNO is an interesting concept," Malone said.
- He thinks "there's very little dirty underwear" left to be found in a regulatory review of Charter-TWC after the past year's scrutiny.
- Also of interest regarding Charter capex and the dividend: “Everybody's going to say, ‘Oh he’s spending too much capital,’ but I think the end result with be worth it ... To a large degree we’re betting on Tom Rutledge and his team to wake up a sleepy cable company that was treading water in all honesty for a while and trying to satisfy shareholder pressures with buybacks and dividends as opposed to putting the money into having a competitive service offering.”
- Malone company shares today: LMCA -0.1%; LMCB flat; LMCK flat; LTRPA -0.9%; LTRPB +2.2%; QVCA +0.8%; LBRDA +0.1%; OTCQB:LBRDB flat; LBRDK -0.1%.
Tue, Jun. 2, 1:19 PM
- On a runway to be taken over by Verizon (NYSE:VZ) -- for the purpose of lending its ad-tech expertise to a mobile-video push -- AOL says it's increasing its video output and moving Aol.com toward a mobile-first design.
- Mobile unique visitors to Aol.com have grown 79.5% over the past 12 months, and now make up 37.8% of traffic, the company says.
- It's promising participation from "premium content partners to next-generation creators, as well as content published and trending across social platforms."
Mon, Jun. 1, 7:57 PM
- Time Warner Cable (NYSE:TWC) has this going for it: It no longer has the industry's worst customer service, at least according to Consumer Reports.
- That honor goes to smaller player Mediacom, though not by much -- and peers like Charter (NASDAQ:CHTR) and Comcast (NASDAQ:CMCSA) aren't much better than that.
- Armstrong and WideOpenWest were highest rated in all the services they provide, suggesting small really is better when it comes to customer service (though Mediacom has just 890K subscribers against TWC's 12.25M).
- When it comes to TV service, Verizon's FiOS (NYSE:VZ) and satellite providers Dish Network (NASDAQ:DISH) and DirecTV (NASDAQ:DTV) did very well with consumers.
Thu, May 28, 3:50 PM
- The FCC is close to rejecting T-Mobile's (TMUS -0.9%) push for more spectrum set-asides in next year's government auction -- expected to be the biggest yet -- and siding with market leaders AT&T (T -0.5%) and Verizon (NYSE:VZ), Reuters reports.
- The agency already has some set-aside planned, but T-Mobile has been aggressively lobbying for more (40 MHz of an expected 70-80 MHz reserved for smaller carriers like T-Mobile and Sprint (S -1.6%), rather than 30 MHz).
- Sources tell Reuters the panel's thinking is that an adequate amount is being set aside, and that frequent swing vote Jessica Rosenworcel looks disinclined to rethink the current plan.
- Previously: Analyst: Risky to bend auction rules too much for Sprint, T-Mobile (May. 14 2015)
- Previously: T-Mobile, Sprint gambling on increasing spectrum set-aside (Apr. 09 2015)
Tue, May 26, 5:03 PM
- With one eye on the Internet of Things, Verizon (NYSE:VZ) is offering a promotion to small-business signups featuring FiOS Internet/voice bundles with 50 Mbps upload/download speeds for the 25/25 Mbps price.
- That applies to businesses in the FiOS fiber markets. With more devices "talking" to the network, Verizon expects upload activity will double by late 2016.
- The deal follows a similar previous move upgrading businesses on asymmetrical speed tiers to symmetrical ones via its SpeedMatch program (for example, 50/25 customers were upgraded to symmetrical 50 Mbps).
Tue, May 26, 3:39 PM
- After Verizon (NYSE:VZ) went to AOL to talk deal last year -- talks that were ultimately successful in a $4.4B merger agreement -- it was approached by three other (unnamed) firms regarding an acquisition, newly filed documents show.
- Verizon had been thinking about a joint venture in order to get its hand on ad tech for its mobile video plans before going for the whole acquisition, the filings show.
- Along the way AOL had thought about selling off "brand assets" (Huffington Post, TechCrunch), and the fate of those sites is still an open question.
- AOL chief Tim Armstrong got a special Founders' Incentive Award of 1.5% of company market value at the time of the deal's completion (at a current $3.9B, a bonus of about $59M) -- though he holds options and shares that would bring him $179M and up.
- 14D-9 filing
Thu, May 21, 9:30 AM
- Alongside Goldman's list of 50 stocks appearing most as top holdings at hedge funds is its list of the 50 top shorts.
- New additions this quarter: Baxter Intl (NYSE:BAX), UPS, Marriott (NASDAQ:MAR), NextEra (NYSE:NEE), Ford (NYSE:F), National Oilwell Varco (NYSE:NOV), McDonald's (NYSE:MCD), M&T Bank (NYSE:MTB), CenturyLink (NYSE:CTL), Amgen (NASDAQ:AMGN), Pioneer Natural (NYSE:PXD), Duke Energy (NYSE:DUK), Seagate (NASDAQ:STX), AbbVie (NYSE:ABBV), Cisco (NASDAQ:CSCO).
- The full list (in order of $ value of short interest): AT&T (NYSE:T), Disney (NYSE:DIS), IBM, Verizon (NYSE:VZ), Intel (NASDAQ:INTC), Kinder Morgan (NYSE:KMI), Exxon (NYSE:XOM), Pfizer (NYSE:PFE), J&J (NYSE:JNJ), Deere (NYSE:DE), Caterpillar (NYSE:CAT), Exelon (NYSE:EXC), GE, Boeing (NYSE:BA), Halliburton (NYSE:HAL), Fox (NASDAQ:FOXA), Comcast (NASDAQ:CMCSA), UTX, Regeneron (NASDAQ:REGN), Merck (NYSE:MRK), salesforce.com (NYSE:CRM), AbbVie (ABBV), Conoco (NYSE:COP), Wal-Mart (NYSE:WMT), Eli Lilly (NYSE:LLY), Celgene (NASDAQ:CELG), Schlumberger (NYSE:SLB), AutoZone (NYSE:AZO), Wells Fargo (NYSE:WFC), Emerson (NYSE:EMR), McDonald's (MCD), Reynolds (NYSE:RAI), Target (NYSE:TGT), Accenture (NYSE:ACN), Coca-Cola (NYSE:KO).
Tue, May 19, 9:39 PM
- Verizon (NYSE:VZ) is seeing about 60% savings as it takes initial steps into converting central offices to fiber from its old copper infrastructure, its senior VP of transformation said at a conference today.
- The company has only transitioned seven of more than 2,000 COs, but it's seen enough to plan to switch them all over, making it the only carrier to make that attempt so far.
- The move was spurred after the company had to replace one of its largest New York COs, wrecked by Hurricane Sandy in 2012. Now, Verizon's Sowmyanarayan Sampath says, the company doesn't really need 60-80% of the 50M square feet of CO real estate it holds today.
- Why now? Copper revenues slides 8-10% each year while remaining a fixed cost. The old network is a $100B annual-revenue industry that costs $63B just to power.
- Speaking of Verizon and fiber: Cablevision (NYSE:CVC) has stepped up a legal scuffle with Verizon by filing suit, asking a judge to find that a Cablevision commercial claiming that Verizon's FiOS isn't "100% fiber optic" is true. Verizon had previously challenged the ad. Cablevision says that the service uses regular cable in the home.
Verizon Communications Inc is a provider of communications, information and entertainment products and services to consumers, businesses and governmental agencies. Its two segments are Wireless and Wireline.
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