10 May 2006

Verizon may sell lines

I came across this news item today that illustrates one of the lesser known phenomena of the telecom industry. It is not unusual for telephone companies to swap lines to rationalize and consolidate their service areas to gain operational efficiences. What is unique about this particular news item is that Verizon appears to be using this "sale" as a way of effectively acquiring smaller telephone companies.

Update: This story in BusinessWeek has a different spin on this story. Rosenbush frames this as a strategy by Verizon to readjust its "investment portfolio" away from a shrinking wireline business and towards a growing wireline one.

Which analysis is more compelling to you?

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