Fear over landline losses has prompted analysts to reduce estimates for third-quarter profit from telecom companies. The shares of Verizon and AT&T have been under pressure since last they reported earnings in late July. AT&T has slid 20% and shares of Verizon are down 21% over the last three months.
According to Thomson Reuters, analysts have reduced estimates for earnings per share and revenue for both Verizon and AT&T over the fear of landline losses. In its last quarterly report, AT&T said total connections fell 8.1% from the year ago period, worse than many anticipated.
Verizon’s landline revenue has also fallen 1.8% from a year ago. Total landlines fell 8.5% in the second quarter from a year ago, with a large amount of that decline coming from the residential segment.
With wireless penetration above 80% in the U.S., there is a limited pool of new subscribers for AT&T and Verizon to compete for.
Meanwhile, AT&T U-verse TV subscribers have topped 100,000 in Houston. It was first introduced in the Houston area nearly two years ago in November 2006. It is now offered throughout the Houston region, including parts of Brazoria, Fort Bend, Galveston, Harris and Montgomery counties. AT&T U-verse is the only national provider to offer a 100 percent Internet Protocol-based television (IPTV) service, using twisted pair to deliver voice, data and video. U-verse services are available in 69 markets in 15 states. The company expects to have more than 1 million subscribers by the end of 2008.
