Technically theyre still phone companies, but traditional providers of voice services are making more and more of their money these days by selling data services. And theyre partnering to a greater extent than ever before with data integrators who can provide necessary back-end connections, as well as voice integrators making the switch to data services.
Savvy companies, like Qwest Communications, jumped on the data opportunity early. Though financial forecasts can change at a moments notice, Qwest CEO Joseph Nacchio has a bullish outlook for 2001.
Many other telcos arent quite so fortunate. With long-distance prices continuing to fall through the floor, some telcos are cutting their workforces. WorldCom, for one, fired 6,000 employees last week, because voice revenue is falling faster than expected. The layoffs were WorldComs first—ever.
Vendors of high-end voice systems also are feeling the pain. Lucent Technologies, for one, lost a whopping $1.58 billion in Q4 and sales fell 28 percent to $5.84 billion during the period. Lucent blamed the bloodbath on "softening" product demand in the CLEC market.