The big mergers have finally been concluded, and there is a lot of people who are wondering what BellSouth’s future is going to be. BellSouth CEO Duane Ackerman had rejected an overture from SBC, according to USA Today. He had waffled on a deal with AT&T, and now well he is the odd man out. Wall Street (analysts) thinks that as the competition cranks-up, BellSouth is going to feel the heat and the profits will simply keep walking out of the door.
Here is the Bell track record so far: BellSouth has 9 states, $28 billion in sales and profit margin of 22.4%. SBC has 50 states, more than 150 countries, $110 billion in sales, and 14.4% profit margins. Verizon has $90 billion in sales, and 18.4% in profit margins. Clearly, bigger doesn’t make you better.
“We may have given up some scale” by passing on deals, Ackerman says, winding up for his punch line. “But nobody has outperformed us.”
A lot of people are feeling negative on the company, but I am not. It is one of the innovators, reluctant as it might be, amongst Bells. It will roll-out video services much before their Cingular partner SBC. They have some of the fastest growing geographies under their footprint. They could buy Sprint’s local business, and could go after some of the smaller CLECs. They could become reluctant buyers of Qwest, or even some of the smaller independent companies like Surewest. There is a lot of things they can do.
No, don’t write them off yet.