SureWest: Broadband Exceeds Telecom

Make no mistake: transforming a legacy "telco" into a "broadband" company is tough, expensive, often-slow work. But SureWest Communications, for the first time, now makes more money from broadband revenues than from traditional telecom segment revenues.

A couple of observations. SureWest lumps its out-of-region services in the "broadband" category, so the growth is not all in-region broadband access connections and video, though both are growing.

Still, the milestone is important. SureWest is in some ways a "classic" smaller, independent "telco." But it has invested heavily in fiber-to-home networks based on Ethernet standards and IPTV. It has no mobile assets and has "bet the farm" on broadband.

But the strategic implications are impotant. It has gone "out of region" in an important way. Most smaller entities, as well as tier one providers, now find that out-of-region growth is crucial.

Also, business customer revenues are important. Over time, as it faces heightened competition from cable companies in the consumer space, SureWest has found business customers a more important customer segment.

That will be true for most smaller providers that cannot rely on mobility or mobile broadband to fuel growth.