Qwests Business Growth
Overall for Qwest, where is your business growth going to come from during the next 24 months? In our business markets groups, we are all about increasing our market share. To your readers, I would point out Qwest is a very viable nationwide company on the business side. It is not an entity limited to the 14 states where we are known as the incumbent local carrier.Across the business markets group, certainly, you have a lot of people taking traditional long-distance voice services. More often than not ... we see people taking voice and IP and local dial tone from us outside the 14 states. We offer business voice and IP nationwide. And then, of course, IP and Ethernet are huge draws. This is a huge opportunity for Qwest as companies begin transitioning from legacy Layer 2 services to MPLS [multiprotocol label switching]-based services. Business users are taking a new look at their networks. That's an opportunity for us to come in and take market share. What about your wholesale channel? In our wholesale channel, we are increasing revenue, but we're increasing the revenue that is profitable. In other words, we are interested in a wholesale business that has a margin associated with it and not just the revenue to say you have revenue coming through the door. How's your retail consumer market shaping up? That's all about taking market share in the area of broadband. Qwest is very proud that we have got our DSL penetration to 85 percent of all the phones inside our 14-state footprint. We've been very successful with solutions to be able to push broadband more into rural areas. We're just now getting to the point where the affordability is getting more difficult on a per-home-pass basis [the cost to the carrier for running broadband lines past a house]. Behind that, we are now coming out with our fiber-to-the-node architecture. We offer-albeit now in limited areas because we are just now beginning to build-the fastest public IPSL [Internet protocol subscriber line] service in the country-in fact, in North America, at 20M bps. We also offer a 12M bps product. In the areas where it is available, sales activity is well ahead of where we expected the service to be. We couldn't be more pleased with the uptake in that service. I think people are really looking at and recognizing the advantage of high-speed DSL architecture versus cable modem architecture. It seems there's not another carrier with as much rural area to cover as Qwest. Do you feel like Qwest starts with one strike against it when it comes to broadband coverage? If you look at Qwest territories, there is a belief that it is extremely rural. The reality is we're not as rural as people may think we are. Yes, we serve 14 states that are wide open, but if you really look at the areas inside those 14 states, they are really some dense metropolitan areas. So, I think our percent of rural is not that different than some of our peer incumbent traditional carriers. Clearly the fundamental financials would say it's more cost effective to build broadband-and certainly extreme broadband speeds-in the denser areas. But we're not Southeast Asia, we are not parts of Europe in terms of densities where everyone lives in an MDU [multiple dwelling unit].
You've said 50 percent of your business customers are outside your 14-state footprint. What services are they taking?