Verizon is still on a roll
Verizon Communications' hot streak continued during the first quarter of 2008.
The company said Monday that first quarter profits jumped about 10 percent to $1.64 billion, fueled by demand for its mobile phone service and fiber-to-the-home service called Fios.
Revenues grew about 5.5 percent to $23.8 billion, the company said. About $11.7 billion of that revenue came from its wireless business, an increase of about 13.2 percent from the first quarter of 2007.
There's no question that Verizon Wireless, which is jointly owned by Vodafone, has a good reputation as a wireless provider. Its network is considered to be highly reliable, and the company has always done well retaining customers.
And now Verizon is getting those customers to use more of its data services, such as picture messaging, text messaging and Internet surfing. In fact, it looks like mobile data is driving growth in the highly profitable wireless business with revenue from data services jumping 48.9 percent from the previous year generating about $2.3 billion in revenue.
Verizon reported that its customers sent or received more than 58 billion text messages and 1.1 billion picture/video messages during the quarter. And customers completed 34.6 million music and video downloads. On average, Verizon's wireless customers spent $11.94 a month on data services, an increase of about 33 percent from a year earlier.
Mobile data accounted for about 20 percent of all wireless sales for the quarter, but the company hopes it will eventually account for a bigger chunk of the revenue pie in the future. About 58 percent of Verizon's retail customers had broadband capable devices at the end of the first quarter, the company said.
Wireless operators, such as Verizon, are counting on consumers to use even more data in the future. That's the reason Verizon spent $9.3 billion on new wireless spectrum licenses in the Federal Communications Commission's recent 700MHz spectrum auction. The company has already said that it plans to use this spectrum to build its 4G wireless broadband network that will deliver even faster data speeds to its customers using a technology called LTE.
The company is also trying to spur innovation by opening its network to a faster certification process for new devices and applications. The hope is that streamlining the process will allow developers to get products and services that use the Verizon network on the market faster than before offering customers new and cool devices and applications first.
But wireless isn't the only shining light for Verizon. The company also saw big growth in its fiber-to-the-home service called Fios. This service, which includes high-speed broadband access, telephony and TV service, competes head-to-head with cable offerings. Verizon said it added 263,000 new TV customers in the first quarter bringing the total number of Fios TV customers to 1.2 million. In terms of broadband, the company said the majority of its new broadband customers were for Fios. The company added 262,000 Fios broadband connections during the quarter for a total of 1.8 million Fios broadband customers.
Verizon CFO Doreen Toben
(Credit: Verizon Communications)As expected, Verizon continued to see declines in its traditional telephony business, which fell 2.5 percent during the quarter. The company cut about 6,500 workers in 2007 and more job cuts in the traditional telephony business are expected throughout the year, company CFO Doreen Toben said.
Verizon's bets on wireless and fiber seem to be paying off. But as the overall U.S. economy softens it will be interesting to see if the company's strong growth will continue. My gut feeling is that Verizon is in good shape. Cell phone, TV, and broadband service are three things that most people won't want to live without even if they are crunched for cash. But the big question is how much more will people be willing to spend on the extras, such as mobile music downloads, mobile TV service or the highest level TV and broadband packages? That's the big question that will likely determine how much growth Verizon will experience in the future.
Marguerite Reardon has been a CNET News reporter since 2004, covering cell phone services, broadband, citywide Wi-Fi, the Net neutrality debate, as well as the ongoing consolidation of the phone companies. E-mail Maggie.
On install day, no one showed, no one called. I had my mobile with me at ALL times. So around 1:30 PM I called Verizon to see what was going on. If something came up, I had a week off to move in and if they needed to come by in a day or two, I was totally cool with that. After about an hour on hold I got in touch with a ?state level? dispatcher. That said that there were ?no facilities available for my order? and I was called. Nope, I wasn?t called; they did have my cell (which I had with me all of the time) in their records. I wanted them to come out later in the week if possible since I was home. They said that their next available time for me was 4-12-08, which was a day where I was going to a wedding. The next available time after that was at the end of the month, on a work day for me.
Basically because they did not show up, or even notify me with a reason, they put me at the back of the line. I was trying to escalate my request and the support only gave me unreasonable dates and that ?no facilities available for my order? BS. I later wanted to get my copper line put back so I could at least get phone service, and after a long wait in hold they gave me the end of the month as a date. Basically I was being run around in circles and being shoved to the end of the line because Verizon screwed up my installation. I was told the only way I could get it sooner is if I ?knew an installer who?d do me a favor,? and I was pretty much screwed with the window of time I had to get the service installed. The salesperson fed me a load of bull and the installer didn?t even call me with a reason. I tried to figure out what ?no facilities available for my order? meant, and why this was such a problem since I already had the ONT in my house. Half of their work was already done.
The same day, I called a local cable company who installed my phone, internet, and cable the next day. They showed up on time and did the normal pre and post appointment verification. I unplugged the ONT in my house and let the battery go out. Verizon gave me such a lousy customer experience I swore I would never do business with them, and be sure to let other people know about their awful customer service and commitments they setup and do not honor. Verizon screwed up prior when they bought Bell Atlantic, and screwed up our perfectly find DSL service I had around 98/99. My money is going to a competitor, and Verizon won?t see it because they have abysmal customer service. I am certainly interested in fiber optic lines connected to my house, but so long as Verizon is the only provider, I will happily do without.
James
Herndon, VA
ended up being that I had talked to a national representative and
they had never transferred my information to the local/state
representatives. Since they messed up, they scheduled me in on
a Sunday, and the installer came out and spent the whole day
wiring my house with the fiber, coax, telephone, etc. They even
ran an extra two Cat5's across my house so I could set up two
wireless hubs at either end. All in all they rescued what could
have been a very bad situation into one I was exceptionally
pleased with.
After having had DSL, cable modem, and FiOS internet, I can say
that I'm certainly never going back to non-fiber network. The
telephone and television service? Eh. But the network is
amazing, and believe it or not worth the crap you have to put up
with because of Verizon's disorganization... I wouldn't cut off my
nose to spite my face by refusing FiOS because of a bad
customer service experience.
- Verizon is too expensive !! too controlling
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by question4seller
April 29, 2008 10:12 PM PDT
- i was with verizon for 6 years, and just moved to tmobile, and i couldnt be happier.
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Reply to this comment
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(7 Comments)Although verizon has great service ( the best) tmobile for example is not far off...
It is only worth having verizon if 1.you only use it for phone calls ( not data/texts) 2. if you dont mind spending more money for the same similar plans.
if you need to text or internet your verizon bill will really inflate...
On top of their more expensive than competitors plans they force you to sign a contract which says that they can charge you up to %45 percent on top of your plan for their own made up fees called SURCHARGES. This does not have anything to do w. taxes or gov. fees... It's their own made up hidden fees...
This does not seem like an honest company to me, and i wouldnt want anything to do them...
Other providers also have great cell phone service, in my opinion its not worth the extra $$ to have the most reliable cell service especially if the diff. is almost not noticeable.