Leading U.S wireline communications company CenturyLink Inc. CTL has introduced Prism IPTV services in Vancouver, WA thereby challenging Comcast Corp.‘s CMCSA dominance in the region. Notably, CenturyLink had been working with Vancouver and county representatives since Dec 2014 to materialize this deal. The city council has granted CenturyLink a five-year, non-exclusive cable TV franchise effective Jan 22, 2016 through Dec 31, 2020.
In August this year, CenturyLink had extended its Prism TV service to Seattle – another Comcast stronghold.
Gearing Up for Competition
CenturyLink is investing in fiber-to-the-tower (FTTT) and fiber-to-the-home (FTTH) expansion and has expanded its fiber-based backhaul services. Its IPTV roll out will bring high-speed Gigabit broadband to these new markets through the FTTH network infrastructure. CenturyLink has also developed an IPTV mobile app for Prism TV, to lure an increasing number of individuals who prefer streaming service over a full-blown TV service.
IPTV and video overall continues to be a big priority for CenturyLink. The company is focused on increasing its customer base. In the third quarter of 2015, CenturyLink added nearly 11,300 Prism TV customers. This apart, it added more than 360,000 homes in new and existing service areas, raising its total count to around 3 million homes by the end of the reported quarter. In addition, the company is trying to complement its IPTV service with an over-the-top video offering to counter increasing deployment and content costs.
The Bottom Line
CenturyLink’s Prism TV service is performing reasonably well and is expected to compensate for the revenue loss experienced due to the decline in single play voice customers. Going forward, CenturyLink remains committed to further expanding Prism TV service to additional households and markets. However, apart from its immediate rival Comcast, the company also faces competition from similar services from telecom providers, like U-Verse from AT&T Inc. T and Go90 from Verizon Communications. Inc. VZ.
CenturyLink currently carries a Zacks Rank #3 (Hold)
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