Opinion on  Qwest Communications International Inc (Q)     Sector: Services  >  Industry: Communications Services
Qwest Communications International Inc (New York Stock Exchange)

Qwest Communications International Inc. (Qwest), incorporated in 1997, is a provider of data, Internet, video and voice services. The Company operates its business within its local service area, which consists of the 14-state region of Arizona, Colorado, Idaho, Iowa, Minnesota, Montana, Nebraska, New Mexico, North Dakota, Oregon, South Dakota, Utah, Washington and Wyoming. Qwest operates in three segments: business markets, mass markets and wholesale markets. Most of the Company’s products and services are provided using its telecommunications network, which consists of voice and data switches, copper cables, fiber optic broadband cables and other equipment. The majority of the Company’s network is located in its local service area. Within its local service area, Qwest’s network serves approximately 11.6 million access lines in 14 states and forms a portion of the public switched telephone network (PSTN).

Business Markets

The Company’s business markets customers include enterprise and government customers. Its business markets customers use its data and Internet services to access the Internet and Internet-based services, as well as to connect to private networks and to conduct internal and external data transmissions, such as transferring files from one location to another. These services include private line, which is a direct circuit or channel for connecting two or more sites. Private line offers a high-speed solution for transmission of data between sites. Its Multi-Protocol Label Switching (MPLS) is a data networking technology, which allows network operators to divert and route traffic around link failures, congestion and bottlenecks. Qwest sells MPLS-based services primarily to its business customers under iQ Networking.

The Company’s broadband services allow customers to connect to the Internet through their existing telephone lines. Data integration includes the sale of telecommunications equipment located on customers premises and related professional services. These services include network management, installation and maintenance of data equipment and building of fiber-optic broadband networks for its governmental and other business customers. Web hosting includes providing space, power, bandwidth and managed services in data centers. Qwest also offer a variety of server and application management, back-up and professional Web design services.

As of December 31, 2008, the Company operated 15 Web hosting centers (CyberCenters) in 11 metropolitan areas. In addition, Qwest provides data and Internet services to its business markets customers. These services include wide area network products, such as automated teller machine (ATM), frame relay, dedicated Internet access (DIA), and virtual private network (VPN), integrated services digital network (ISDN), and Internet dial-up access.

The Company offers its business markets customers local voice services, long-distance voice services and wireless services. Qwest originates, transports and terminates local voice services within its local service area. Local voice services primarily consist of basic local exchange and switching services. The Company also provides features with its local voice exchange services, such as caller identification (ID), call waiting, call return, three-way calling, call forwarding and voice mail. Long-distance voice services include domestic and international long-distance services and toll free services. Its international long-distance services include voice calls that either terminate or originate with its customers in the United States.

The Company sells wireless products and services, primarily to customers who are located within its local service area and who buy these products and services as part of a bundle with one or more of its other products and services. In April 2008, Qwest entered into a five-year agreement with Verizon Wireless that allows the Company to market and sell its wireless products and services under its name to its mass markets and business markets customers.

Mass Markets

Qwest’s mass markets customers include consumers and small businesses. The Company’s mass markets customers generally use its data, Internet and video services to access the Internet, Internet-based services and digital television. Its mass markets data, Internet and video services include primarily broadband services and satellite digital television. Qwest’s broadband services allow customers to connect to the Internet through their existing telephone lines. The Company’s satellite digital television services are offered under an arrangement with DIRECTV that allows the Company to market, sell and bill for its service under its name to its mass markets customers.

The Company offers its mass markets customers local voice services, long-distance voice services and wireless products and services. It originates, transports and terminates local voice services within its local service area. Local voice services primarily consist of basic local exchange and switching services. The Company also provides features with its local voice exchange services, such as caller ID, call waiting, call return, three-way calling, call forwarding and voice mail.

Wholesale Markets

The Company’s wholesale markets customers are other carriers and resellers that purchase its products and services to sell to their customers or that purchase the Company’s access services that allow them to connect their customers and their networks to the Company’s network. Data and Internet services offered to wholesale markets customers include primarily private line and DIA. Voice services include local voice services, long-distance voice services and access services. Local voice services include primarily unbundled network elements (UNEs), which allow the Company’s wholesale customers to use its network or a combination of its network and their own networks to provide local voice and data services to their customers.

The Company’s local voice services include network transport, billing services and access to its network by other telecommunications providers and wireless carriers. These services allow other telecommunications companies to provide telecommunications services that originate or terminate on the Company’s network. Long-distance voice services include domestic and international long-distance services. Access services include fees that Qwest charges to other telecommunications providers to connect their customers and their networks to the Company’s network so that they can provide long-distance, transport, data, wireless and Internet services.

The Company competes with AT&T Inc., Sprint Nextel Corporation, Verizon Communications Inc., Global Crossing Ltd. and Level 3 Communications, Inc.