Wireless, telecom and pay TV — including cable, satellite and Internet services — are all on a growth trajectory, but each company is taking a different path. That means comparing them will be more difficult going forward. In the past, the companies in these sectors in many respects looked the same and offered nearly the same basic services. Looking forward however, things appear very different.
The future is all about the cloud, artificial intelligence, virtual reality, cognitive computing and much more. Those are the areas where the growth and amazing technology will be centered.
AT&T and AT&T Mobility
AT&T started out as a telephone company. Today it is one of the top communications providers in the U.S., offering telephone, wireless, Internet access, IPTV and satellite TV services.
AT&T has introduced mobile TV, tying its wireless TV with DirecTV, letting viewers watch programming on their smartphones or tablets anywhere in the United States, over the AT&T Mobility wireless network.
It plans to expand into the content side with its pending acquisition of Time Warner. AT&T continues to grow in areas that make sense and that bolster its competition with companies like Comcast and NBC, and Verizon, AOL and Yahoo.
Verizon and Verizon Wireless
Verizon used to be on the same page as AT&T, but it is changing as well. It once offered wireline phone service, but it seems it is moving out of that area. It now offers wireless and IPTV through its FiOS brand.
It plans to move into content and advertising in the future. It acquired AOL, and its Yahoo acquisition deal is pending. Verizon sought these companies for their customers and advertising opportunities.
There now is talk that Verizon may be interested in getting into the cable TV space, perhaps by acquiring a company like Charter Spectrum, to compete with AT&T.
Sprint, a wireless-only player, is turning into a growth company once again. That is great news for shareholders and customers.
Under new management, it started upgrading its network in the last couple of years, and it now provides innovative service offerings and low pricing.
Inspired marketing has helped restore Sprint’s health, and it now is heading in the right direction again.
T-Mobile, another wireless-only player, also was struggling several years back, having missed the move from 2G to 3G.
Then it brought in new management, which transformed the company.
T-Mobile started its recovery a few years before Sprint did, and it now is on a solid growth track. It has turned into a growth company.
CenturyLink has been growing through mergers. It acquired Qwest, which turned it into a big telecom player overnight, when it became the third-largest baby bell.
It also acquired companies like Embarq and Savvis, and recently announced its acquisition of Level 3.
CenturyLink is a much smaller player than AT&T and Verizon, and it is not a wireless or television player, but it is making progress on the wireline side.
Windstream also has grown through a variety of mergers. The most recent — just announced last week — was with Earthlink.
These mergers will help Windstream grow in the Internet space by adding customers and technology for expansion into new areas. The company offers a variety of wireline services, including telephone, Internet and digital television.
The problem is that it has nothing to offer in wireless. Several years ago, in a speech to the Windstream board of directors, I recommended expanding into new areas. I am glad to see the company is doing that. However, a move into wireless would be good to see, since it is one of the most important areas going forward.
Comcast Xfinity’s Goals
Comcast started out as one of the many smaller cable television companies, but about a dozen years ago it acquired AT&T Broadband, then the largest cable television company, and Comcast became No. 1 in the space overnight.
Next, Comcast acquired NBC, and it has been in both the service provider and content space for years.
Its push into Xfinity has helped it buck the trend hurting others in the traditional cable TV space. It failed at wireless, but it is going to give it another try in 2017. We’ll see if it is successful this go-round.
Charter Spectrum’s Plans
Charter recently acquired Time Warner Cable, enlarging the size of its operations. It now is the No. 2 cable provider. While this traditional cable TV merger increased the size of Charter, the company still faces a decline in market share. This is a real problem it needs to solve.
Charter also acquired Bright House recently.
Customers are not happy with the treatment they’re receiving from Charter Spectrum. This is a serious problem it needs to address, as it faces more competition every year.
With the introduction of Spectrum, it hopes to buck the trend and see growth going forward, much like Comcast has done with Xfinity. We’ll see. Charter does not offer wireless.
AI and Cognitive Computing
All sorts of new technologies are beginning to transform a wide range of industries. Consider IBM Watson. It uses AI, the cloud and cognitive computing. It reads and absorbs unbelievable amounts of data and can do things that no human brain has the capacity to do.
Its healthcare capabilities can be life-saving. It transforms the automotive experience with AI on the dashboard for the driver and passengers.
There are many other companies, large and small, starting on their next growth wave in the machine learning space, including Microsoft, Amazon and many others. This is an exciting time whether you are an investor, customer, worker, executive, partner or user.
Not every company will succeed, though. There are quite a few players besides these top companies, and there will be both winners and losers among them. Expect a wild ride for the industry, and do your best to choose the winners.