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New CEO enters as Qwest faces stiff competition
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Mueller, who took the reigns at Qwest only about six months ago, addressed a packed house of analysts and journalists in New York on Monday at an event hosted by the company to provide a glimpse at its strategy for the next year. He told the crowd that he recognized that Qwest has some holes in its business--namely in wireless--and he said he's ready to start plugging those holes.
He said he sees wireless becoming a big part of the company's strategy going forward. Not only will wireless broadband be important, Mueller said, but offering some kind of wireless service to bundle with Qwest's other services will become crucial as the company competes head-to-head with cable operators.
But Denver-based Qwest, the third-largest phone company in the U.S., is not going to spend millions of dollars acquiring wireless spectrum and building a new network. Instead, Qwest is on the hunt for partners.
Qwest already resells wireless service from Sprint Nextel. But Mueller said this partnership is not working well for Qwest, and the company is looking to either renegotiate its deal with Sprint or find another company with which to partner in wireless.
Mueller pointed to Qwest's partnership with satellite TV provider DirecTV as an example of a partnership that is working well. And he said he hopes that the company could replicate that relationship and expand it in wireless.
CNET News.com sat down with Mueller and two other Qwest executives--Dan Yost, executive vice president of product and IT, and John Richardson, CFO--after the analyst conference on Monday to drill down on how they think these partnerships can help Qwest grow.
You talked earlier today about Qwest striking better partnerships. But it's hard to make money from partnerships, so how does this work for Qwest?
Mueller: We make some money on the partnership. So today, we have an MVNO (mobile virtual network operator) relationship with Sprint. And we lease the network. We also have a partnership with DirecTV where we take some of the revenue.
But can you really make money in a wireless partnership where you don't own any of the assets?
Mueller: For wireless, making money with partners is one part, but getting a bundled product with a full set of products that we can (use to) keep stickiness with the rest of our product set is just as important and very powerful for us.
You also mentioned forming deeper, more integrated partnerships. What does this mean?
Mueller: Let's take DirecTV as an example. Today, we market their product and put it on our bill. It's conceivable that down the road, they might provide video-on-demand service. They could go over our high-speed Internet link. We would then not only provide the transport for that service, but maybe we'd also be integrated into their set-top boxes. That would be an example.
How would you form it in wireless?
Mueller: In wireless, we would be able to bring our customers those services immediately, which is deeper than we do today. We would have high-speed broadband wireless products that would be jointly marketed and come to the marketplace together.
We may also have a product on a wireless device that may have an application for us, like in your home. Take an iPhone, for example--they have an application that might integrate with our voice service or e-mail and voice mail. Those kinds of things that would be unique to our partnership and our region.
See more CNET content tagged:
Edward Mueller, Qwest Communications Inc., wireless service, broadband wireless, DirecTV
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Qwest Wireless (then US West and US West Wireless) was building out a best of breed wireless network following a "make it the best network in the market" strategy (every market they had wireless network in, they dominated market share and had the best coverage and capacity by far), starting in their wireline 14 state region and then growing from there. Network buildouts were gaining in efficiency and had capabilities INCLUDING broadband (2.5 and 3G speed) wireless data (using CDMA technologies) baked in. They also had a very close and positive relationship/partnership with the network infrastructure providers... so they got access to emerging technologies that the other networks simply didn't bother with (e.g. Wireless data, Wireless E 911, Location based services, Wireline integration, Wireless local loop services, etc.). Back then, the vision was convergence of services and Qwest's current consumer offering is a mere echo of the capability they had when they held their wireless assets (that strategy was basically moving all the consumer voice traffic off the copper network to free up the bandwidth for video and data over copper).
The new leadership needs to swallow their pride and look backward in order to move forward. The "I wasn't here when that happened" excuse just doesn't cut it. They need to learn what IP, people, knowledge, etc. it already has in house or nearby to formulate a truly innovative strategy, not just make minor improvements to duct tape and bailing wire crap bundles they are dishing out today. Peter Mannetti (Former president of US West Wireless) is still in Denver and I am confidant Sol Trujillo (President & CEO of US West at that time) could even be lured back to renew this once great company to its former grandeur. Granted it?s a very different company these days (US West was very profitable and flush with cash before Qwest sucked it dry) but these are two leaders who knew what they were doing and were executing on a vision... That vision was clipped short by the greed of an antsy board and a bombastic jackass convict named Joe. Maybe they would be willing to help bring some of that magic back.
The US wireless market is retarded at least... and in some cases seems like it's going backwards. We need a (renewed) champion of emerging technology, not just another crappy reseller who is following the herd. Take a look at Europe and the Pacific Rim countries and try to tell me we are leading this charge in any way shape or form... that needs to change. US West/Qwest used to be that company... maybe it could be again.
I found this article while searching for a way to communicate with Qwest management. Qwest has done a good job of building a firewall between management and customers.
My family has been loyal Qwest customers for over a decade. Recently, my daughter dropped her phone in a bucket of water. Trying to reach a workable solution with Qwest customer service has been frustrating at best. Now, after all these years of loyalty, we are considering another service provider. Qwest, you need to give your customers a reason to brag about your customer service, develop some flexibility instead of rigidity, and create a communication path to your management team. Your survival depends on it.