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Verizon Communications (VZ)

- NYSE
  • Thu, Apr. 23, 5:21 PM
    • Verizon (NYSE:VZ) says that Walt Disney (NYSE:DIS) -- one of a group of program providers that claim Verizon's new slim cable packages violate their contracts -- is refusing to carry Verizon's ads for the new packages.
    • NBCUniversal (NASDAQ:CMCSA) and Twenty-First Century Fox (FOX, FOXA) joined Disney this week in saying that Verizon's plan to let subscribers choose smaller, cheaper bundles violated their carriage agreements. Verizon CFO Fran Shammo said firmly that the company wouldn't retract the product.
    • Fox and NBC haven't pulled the ads so far. Disney owns the ABC Network as well as the ESPN networks.
    • The new Verizon plans, designed to offer more variety than large one-size-fits-all bundles, start at $55/month for a smaller channel lineup. They're available on Verizon's FiOS service, which has 5.7M TV subscribers.
    • Previously: Disney: Not so fast on skinny bundling, Verizon (Apr. 17 2015)
    | 3 Comments
  • Wed, Apr. 22, 8:29 PM
    • Google's Project Fi wireless MVNO (mobile virtual network operator) service will piggyback on the networks of Sprint (S +2%) and T-Mobile (TMUS +2.2%) when it's not using Wi-Fi to route calls and data -- and while traffic is better than "no traffic," analysts at Cowen and Evercore say it won't mean much benefit for the two wireless firms.
    • Colby Synesael of Cowen says that financial gains will be limited for the two (and for Google): It's all about Google trying to shape the market in ways that might eventually pay off. The offer is "compelling" on price and technology and could make a monetary difference if device support grows, but it's more likely about carriers making Fi's practices mainstream, he says.
    • On price, the data giveback and international aspects of Fi could pressure AT&T (NYSE:T), Sprint and Verizon (NYSE:VZ) to follow suit, Synesael writes.
    • Evercore's Jonathan Schildkraut found the announcement in line with expectations, though "we also would not rule out a potential relationship between GOOG and the MSOs' Wi-Fi networks as another way to dis-intermediate the traditional carrier," he writes. "Not as Bad as Expected for T and VZ. We view the higher than expected toll to get on the network ($20) as likely better for carriers than anticipated."
    • Previously: Google launches Fi mobile service - $20/month for voice/text, $10 per GB (Apr. 22 2015)
    | 17 Comments
  • Wed, Apr. 22, 3:24 AM
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  • Tue, Apr. 21, 5:00 PM
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  • Tue, Apr. 21, 8:53 AM
    • Verizon (NYSE:VZ) is flat premarket after a first quarter where it added 565K net retail postpaid wireless connections (up 4.8% Y/Y) and churn fell back to 1.03%, from a prior-year 1.07% and Q4's 1.14%.
    • On an adjusted basis, EPS of $1.02 was up from last year's $0.84 after accounting for gains from the company's acquisition of full ownership of Verizon Wireless in February 2014. EBITDA of $11.95B beat expectations by $420.4M.
    • Revenue by segment: Wireless, $22.3B (up 6.9%; Service revenue of $17.9B, equipment revenue of $3.4B); Wireline, $9.5B (down 2%; Mass market revenue of $4.6B, Global Enterprise of $3.3B, Global Wholesale of $1.5B).
    • Operating income of $8B was up 11.2%, and operating income margin up to 24.9% from the prior year's 23.2%. EBITDA margin rose to 37.4% from 36.7%.
    • The company's monetization of tower assets led cash flow from operations to rise to $10.2B from $7.1B, but excluding tower impact, free cash flow was up to $4.2B from $3B.
    • FiOS revenues were up 10.2% Y/Y, to $3.35B. Verizon added 133K net new FiOS Internet and 90K net new FiOS Video connections to bring totals to 6.7M Internet and 5.7M Video connections.
    • Verizon's retail postpaid average revenue per account fell to $156.14 from $159.67. Smartphone postpaid accounts rose to 91.4% of phones activated.
    • Press release
    | 7 Comments
  • Tue, Apr. 21, 7:40 AM
    • Verizon (NYSE:VZ): Q1 EPS of $1.02 beats by $0.07.
    • Revenue of $31.98B (+3.8% Y/Y) misses by $290M.
    • Shares +0.36% PM.
    • Press Release
    | 10 Comments
  • Mon, Apr. 20, 5:30 PM
  • Fri, Apr. 17, 9:13 PM
    • A spokesperson for ESPN (NYSE:DIS) has weighed in on reports that Verizon (NYSE:VZ) will offer unbundled or "skinny" packages to give customers choice about what they receive -- and ESPN says that's not allowed.
    • “Media reports about Verizon’s new contemplated bundles describe packages that would not be authorized by our existing agreements," says the company's statement. "Among other issues, our contracts clearly provide that neither ESPN nor ESPN2 may be distributed in a separate sports package.”
    • The move's unsurprising coming from ESPN, which charges the highest prices per subscriber by far among national cable peers, reportedly now more than $6/month. That compares with TNT at around $1.48/subscriber month.
    • ESPN has made defending bundles a policy priority in Washington, and companies with powerful bundles of channels like Disney (with the various flavors of ESPN as well as the Disney Channel and Soapnet) can force channels with low or no consumer interest into bundles with the desired flagship stations to build their audience.
    • The statement suggests Verizon didn't get a sign-off from Disney before talking about unbundling, though Peter Kafka reports that Verizon's Alberto Canal said the company had gotten authorization from all programmers in its new bundle.
    | 36 Comments
  • Fri, Apr. 17, 7:54 PM
    • Mobile phone consumers might be happy, but the industry's price war is showing up as average revenue per account is dropping, according to Cowen's quarterly wireless survey.
    • Bills fell for a second straight quarter, to an average of $136/month, down from Q4's $141. The biggest drop came to Sprint (NYSE:S), whose "Cut Your Bill in Half" promotion is taking hold by reducing its average bill 14% Q/Q to $132/month.
    • Verizon (NYSE:VZ) is below $150 for the first time in the survey, slipping 5% to $143.
    • On the other hand, AT&T (NYSE:T) was essentially flat at $143/month and T-Mobile (NYSE:TMUS) actually increased ARPA 4% to $121.
    • Sprint may face a churn problem: 24% of subscribers whose contracts are up in the next six months say they'll leave, above the industry average of 13%.
    • Subscribers without contracts are up to 34.5% from Q4's 30.5%, spurred by T-Mobile's huge contract-less base.
    | 42 Comments
  • Fri, Apr. 17, 3:40 PM
    • AT&T (NYSE:T) is a dividend stalwart, yielding 5.7%, but Morningstar DividendInvestor Editor Josh Peters dropped it from his model portfolio in favor of lower-yielding Verizon (NYSE:VZ).
    • He's willing to swap for Verizon's 4.5% yield because the "quality, the safety of the dividend, and the growth of the dividend and the total return it will drive are superior."
    • He lost some patience with AT&T's wandering outside of core business rather than sticking to its knitting and growing the dividend faster than 2%. Verizon is focused on U.S. wireless with better capital allocation, he says.
    • Coverage plays a part as well: "Verizon is covering its dividend 1.5 times with free cash flow. AT&T is just barely covering its dividend now with free cash."
    • Josh Peters video interview
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  • Fri, Apr. 17, 4:36 AM
    • Starting April 19, Verizon's (NYSE:VZ) FiOS service will offer new TV packages aimed at giving customers flexibility to purchase only certain groups of channels they want to watch.
    • "While this is not all-the-way a la carte, customers have the ability to consolidate and collapse the kind of content they want to view," announced President of Verizon FiOS Tami Erwin.
    • FiOS’s cheapest plan will cost $55/month and include two channel packs. Each additional package, which can consist of 10-17 channels, will cost $10/month.
    • Customers will also be able to switch to a different channel pack after having one for 30 days.
    | 7 Comments
  • Thu, Apr. 16, 1:31 PM
    • Verizon (NYSE:VZ) is turning to college sports for its mobile-first streaming video service, inking deals with a number of partners to fill out an offering that should have 20-30 channels later this year.
    • The company has deals with ACC Digital Network, Campus Insiders, CBS Sports, ESPN and 120 Sports to join its deal for 200 hours with Awesomeness TV (NASDAQ:DWA).
    • What does Verizon get? "Dozens of live major college games" from CBS and "select live college football and college games" as well as original-entertainment shows like 30 for 30 from ESPN (NYSE:DIS).
    • Pricing and packaging for the service are still unresolved, but Verizon does plan to offer it only via its mobile data plans at first.
    | Comment!
  • Tue, Apr. 14, 7:17 PM
    • With the FCC's new net neutrality rules published in the Federal Register, AT&T (NYSE:T) and three industry trade groups representing cablecos and wireless carriers have filed separate lawsuits challenging the rules, which subject firms to heavier "telecom services" regulations.
    • AT&T is the first large individual challenger, joined by the National Cable and Telecommunications Association, wireless group CTIA and the smaller American Cable Association. The NCTA has hired former solicitor General Ted Olson, who argued Bush v. Gore before the Supreme Court.
    • Publication in the Federal Register means the rules take effect 60 days from yesterday -- which is why affected companies had their briefs warmed up.
    • Represented/related companies: VZ, TMUS, S, CMCSA, CHTR, TWC, CVC, CTL, FTR, CCOI, DISH, DTV
    | 53 Comments
  • Fri, Apr. 10, 8:32 AM
    • AT&T (NYSE:T), Verizon (NYSE:VZ) and T-Mobile (NYSE:TMUS) have received the AWS-3 wireless spectrum licenses that they bid for in a record FCC auction, but -- with a complicated application that involved its use of designated entities as bidders -- Dish Network (NASDAQ:DISH) has not, yet.
    • Dish spent the second-most in the auction ($13.3B gross bids, to AT&T's $18.2B), but its use of three DEs was criticized by competitors and Republican FCC commissioners alike, and it was missing from the agency's new list of 11 of 31 bidders whose bids were found to be complete and paid in full.
    • Still, given time, Dish is expected to ultimately get confirmed for its spectrum, as challenges to its approach haven't found traction -- at least this year. The FCC is reviewing its rules for DE bidding in advance of 2016's low-band spectrum auction.
    • "We ... still don't believe any restrictive or punitive action can take place on Dish's designated entities as a result of the AWS-3 auction," says Walter Piecyk of BTIG.
    • Previous FCC auction news
    | Comment!
  • Thu, Apr. 9, 10:00 PM
    • In a new report on fiber, DSL and cable broadband subscribers, Infonetics Research projects that consumers are driving global fixed broadband adoption toward a 5% compound annual growth rate through 2019, from a current base of 733M (up 8% last year).
    • Global growth will lead the way, the firm says, especially in China (Asia Pacific has 50% of the world's fixed broadband subscribers, and China Telecom (NYSE:CHA) is the worldwide share leader) -- as well as Russia, Brazil, Mexico, Arrgentina, Indonesia, Thailand and Vietnam.
    • Other insights: DSL's still the biggest technology, but growth is coming via fiber-to-the-home and DOCSIS 3.0 cable; and FTTH subscribers grew 22% last year to cross the 100M-subscriber line.
    • U.S.-traded players in the firm's report: T, BT, CHA, CHU, CHT, CMCSA, OTCQX:DTEGY, OTCPK:KDDIY, KT, NTT, ORAN, OTCQX:ROSYY, TI, TEF, OTCPK:TELNY, OTCPK:TLSNY, OTC:TMXLF, OTCPK:TLSYY, TWC, OTC:TRKNY, VZ, VIP, VOD
    | 2 Comments
  • Thu, Apr. 9, 9:08 PM
    • Don't let recent merger challenges and failures fool you, Michael Wolff argues: "M&A mania" is coming to a media conglomerate near you amid pressure for a new wave of consolidation.
    • "Perhaps never before has consolidation been so much the flavor of the month, nor has it seemed so difficult to get a taste," he writes. "The table is set, but nobody's sitting down to eat."
    • If Comcast (NASDAQ:CMCSA) fails in its bid for Time Warner Cable (NYSE:TWC), he notes, it just means other cablers will step up to match Comcast's ambition, and Comcast will still look for a way to stay dominant.
    • He points to a number of mergers he thinks are easily imaginable: Viacom (NASDAQ:VIA) and FOX? Disney (NYSE:DIS) and Time Warner (NYSE:TWX)? TWC and Charter (NASDAQ:CHTR)? Discovery (NASDAQ:DISCA) and, well, most anyone (Disney, Fox, CBS)?
    • Factors encouraging the wave: Media's all about video now, and the pure-play aspect makes merger logic cleaner; distribution and content are separate and now even antagonistic businesses; the growth of over-the-top means not unbundling but re-bundling; and everyone needs scale for negotiation strength in content and ad deals.
    • Other key players: John Malone (LMCA, LBTYA, STRZA); Verizon (NYSE:VZ); Lions Gate (NYSE:LGF); Scripps Networks (NYSE:SNI); Netflix (NASDAQ:NFLX); DirecTV (NASDAQ:DTV) and AT&T (NYSE:T); Dish Network (NASDAQ:DISH).
    | 17 Comments
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Company Description
Verizon Communications Incis a provider of communications, information and entertainment products and services to consumers, businesses and governmental agencies. Its two segments are Wireless and Wireline.