subject: What's Next For Qwest After Acquisition By Centurylink? [print this page] Why has Qwest been stuck while AT&T and Verizon are successfully remaking themselves? This isn't the way it started. Qwest was changing the world ten years ago. What happened and why has this company been struggling ever since? The bigger question is what is next. How will the company change after the acquisition by CenturyLink?
In 1984 AT&T was broken up into one big long distance company and seven regional local phone companies. Qwest started out life as one of these. Names changed over the next decade or two. It was called US West before they changed in the late 1990's. They started out being a simple local phone company then decided to expand and merge with a long distance company and transform themselves. The future looked bright for the company. Then the bottom fell out and the company has been struggling ever since.
They brought in a new CEO Dick Notebaert. He ran one of the other baby bells, Ameritech out of Chicago until it was acquired by SBC who changed its name eventually to AT&T. His job was to save Qwest, which was in the process of imploding.
Notebaert had two jobs. One was to stop the bleeding, which he did. The other was to grow the company, which he did not. He retired in 2007 and was replaced by Ed Mueller as CEO. Everyone watching this hoped for the best.
The hope was Mueller would help the company grow. Unfortunately that wasn't the case.
We have seen many mergers over the last decade. There are only three baby bells now. AT&T and Verizon are the two largest. They both merged with other baby bells. They have grown into the two largest local phone giants, the two largest cell phone networks, the two largest IPTV providers competing with the cable television industry. They have transformed themselves and are growing rapidly.
Qwest on the other hand is not. They do not own their own wireless business. They resell Verizon. They do not own their own IPTV service. They resell a satellite television service.
In essence they are the same company they were several years ago. Competitors like cable television companies are taking customers and they are not taking any away themselves like AT&T and Verizon are doing.
Why can't Qwest grow and change like other baby bells? That is the question we have been asking for years.
Now the company is being acquired by CenturyLink. This is a small local phone company who has been rapidly growing through acquisitions. They are now acquiring Qwest which will make them a baby bell.
Now the future depends on what this company does. Will it remain the same, just part of a larger company? Or will it change course like AT&T and Verizon?
The bottom line is we don't yet know. We have not closely followed CenturyLink, but we will now going forward.
Will they continue to acquire companies? The thinking is yes. Who is next? There are no more baby bells for sale. There are other smaller ones scattered across the landscape from coast to coast. That is likely.
What about wireless? Do they see wireless being important going forward? Is a wireless company in their sites? If so who? Maybe Sprint, T-Mobile or one of the smaller ones? There are few wireless carriers left. They too have gone through a wave of consolidation.
We don't have the answers yet. They may not either at this time. We'll have to wait and see. First they have to finish the acquisition of Qwest. I would not expect anything new until after the acquisition.
It will be interesting to see what happens next to customers, services, investors and workers. What changes and what stays the same. Will this new company grow into a competitor, or will they just continue to serve customers, as is, just a larger version of who they were before.
The future could be bright, but we just don't know yet. It will be interesting to watch the next inning in this game play out.
