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TMCNet:  Jeff Kagan: What to Expect in 2014 in Wireless, Wire Line and Internet (Part III)

[January 01, 2014]

Jeff Kagan: What to Expect in 2014 in Wireless, Wire Line and Internet (Part III)

(Equities.com Via Acquire Media NewsEdge) (On Dec. 20 analyst Jeff Kagan gave his first round of predictions for what tech and telecom would look like in 2014. He followed with another round on Dec. 26, detailing what he saw in store for Microsoft, Qualcomm, Sprint, and others. This is the third and last round of predictions for the nascent year.) C Spire Wireless C Spire is a smaller wireless carrier in the southeast United States and they have really been making some very interesting moves this year.


They are expanding beyond traditional wireless. They started Vu Digital which helps web surfers find the stories and news they search for. And they do this over the wire line and wireless Internet.

They also stirred up excitement in 2013 by announcing they would roll out super high speed Internet in a city in Mississippi. They ended up selecting several cities and that is generating lots of excitement.

This it the same kind of very high speed Internet like Google in Kansas City, AT&T in Austin and CenturyLink in Las Vegas.

This company has punched its way onto the marketplace and is definitely worth keeping an eye on.

CenturyLinkCenturyLink (CTL) is the number three "Baby Bell." If you recall, they acquired Qwest and Embarq and several other companies in recent years. They are now a stronger player who is trying to see growth in new areas like wireless and television.

While this is what AT&T and Verizon are both doing very well, CenturyLink is still struggling for a successful foothold in these areas.

They operate like a young and energetic company who is trying time and time again and you have to give them a lot of credit for that.

I like the company and the management and think they can see growth in these and other areas going forward. Let's hope they begin to do so in 2014.

WindstreamWindstream (WIN) is another interesting wireline company. They have spent the last few years acquiring other smaller companies and growing their business. They are larger today and that is the good part. The bad part is the wireline phone business is not growing. Just ask AT&T, Verizon and CenturyLink. It's shrinking.

Since Windstream is not a wireless company or television provider, my concern is for future growth. They continue to focus on business services and they continue to do strong business today.

So while I don't see any red flags, I also don't see any enormous or rapid growth opportunities either. Things could change of course, and I hope they do.

I have met their CEO Jeff Gardner and several of the key executives, and think they are good people, doing a good job. However I sure would not mind seeing them in a faster growing segment of the business.

tw telecomtw telecom (TWTC) originally came from Time Warner and is now an independent company. They focus on the business community and have been doing a great job.

Similar to Windstream, they deliver wireline services to the business community and are part of the backbone used by other telecoms. They are positioned well, even though they don't deliver wireless or television.

This is a relatively quiet company. There is never a lot of news from tw telecom, and their growth is never stellar, but they are consistent. I see that continuing.

ComcastComcast (CMCSA) is the largest cable television company after acquiring the cable business from AT&T. If you recall AT&T acquired TCI from Denver in the late 1990's.

Comcast is involved with delivering not only cable television, but telephone and high speed Internet. In recent years Comcast also acquired NBC properties and have multiple growth opportunities.

However the traditional cable television business is under threat. They grew for many years when there was limited competition from satellite TV. Today things are changing.

During the last few years we have seen both AT&T Uverse and Verizon FiOS jump in and compete. Comcast still has the majority of market share on a nationwide basis.

However in the cities where they compete against AT&T Uverse and Verizon FiOS, Comcast is losing customers. One example, in the Dallas area, where they compete against AT&T Uverse, the market share is roughly a 50 / 50 split between Comcast and AT&T.

That means Comcast is losing while AT&T is winning. That's the problem for Comcast.

They tried to offer a wireless service and unfortunately it did not work. Today they are partnered with Verizon and Verizon Wireless in a confusing business relationship.

And we are just in the very early stages of this transformation that is changing the cable television industry. New technologies and new competitors are threatening to change the space.

Comcast must transition and continue to grow. However they may be the best positioned to do so among the cable television industry today.

Time Warner CableTime Warner Cable (TWC) is the second largest cable television company, but is rumored to be in play. Will it be acquired? Maybe. By who is the question? We have heard about Charter and Comcast, maybe others.

Why is Time Warner Cable getting out of the cable television business? If they are, the pressure to change and the threat of new and innovative competitors and technology may be one reason.

The cable television space has many new competitors and technologies that are changing the business.

They tried to offer a wireless service and unfortunately it did not work.

Time Warner Cable has provided a good quality service over the years. The cable television industry has never had a good relationship with customers. However Time Warner Cable has done pretty well in this marketplace.

Cox Cox is a company in a lot of different businesses, from the media like radio, television and newspapers, to being a cable television competitor in markets around the country as well.

Cox is a well run and consistent company. They are however facing the same industry reshaping changes and challenges as Comcast and Time Warner Telecom.

The company will likely continue to do well going forward, however their growth in cable has not been what I expected.

They tried to offer a wireless service and unfortunately it did not work.

This is a company, which customers really like. That's in the plus column. However they still must be in a good position to transform because their entire industry is starting to do so.

Final Thoughts There are many more companies and these are just a few that are changing as their segments change We have seen the industry go through these kinds of fits and starts before, and I think 2014 will be yet another big year of transformation.

Expect change in the types of services that will be hot and the types of services each company will offer.

Expect more mergers and acquisitions.

Expect companies to compete outside their core areas with other competitors. Some who they have competed against before, and others who they haven't.

Who will lead going forward, who will follow and who will struggle? Some of today's leaders will get stronger. Some will weaken. Some of the companies who have struggled over the last several years will now grow.

2014 will be a year of rapid growth, change in technology, competitors and leadership. Nothing stays the same. They key question is who will lead going forward in the communications space, wireless, wire line and Internet.

It will be very interesting to keep our eyes on today's leaders, and see who wins and loses going in 2014. You know there will be surprises going forward. Let's just keep our eyes open and see what happens next

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