Sunday, August 9, 2015

Former Rural Telcos Now Drive Revenue from Business Customers

Of $4.4 billion in CenturyLink second quarter 2015 revenue, business revenues represented $2.7 billion while consumer revenues were about $1.5 billion. In other words, the business segment represents 61 percent of company revenue.

That is a huge transformation for a firm that once mostly got its revenue from subsidies and consumers.

What is interesting in that regard is the transformation of revenue sources at CenturyLink, Windstream and Frontier Communications, all legacy rural telecom service providers who have turned to business customer segments to drive growth.

Since about 2010, both Windstream and Frontier have earned most of their money in the business segment, despite the continuing preponderance of consumer accounts.

In its second quarter of 2015, Windstream had revenues of $1.4 billion. Consumer revenues  represented just $314 million--about 22 percent--of total revenues.

Frontier Communications total revenue of about $1.4 billion as well, with consumer revenue of about Total residential revenue was stable at $615 million for the second quarter of 2015, while total business revenue was $621 million. So a bit more than half of revenue was generated by business customers.

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