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http://www.courant.com/technology/sns-ap-cable-telecom-outlook,0,7669378.story
Fitch Ratings sees trouble for cable and telecom industries from economy, regulatory changes
By Associated Press
12:55 PM EST, December 3, 2008
NEW YORK (AP) _ Fitch Ratings on Wednesday pointed to difficult times ahead for the cable and telecommunications industry as unemployment and home foreclosures balloon and it faces an uncertain regulatory landscape under a new president.
The ratings agency said the sector will likely see weaker cash flow and increased leverage. If the downturn becomes more severe, Fitch said it might downgrade some companies' credit ratings.
The housing slump, Fitch said, has pumped up competition among phone and cable companies for existing voice and video customers,
"Aggressive marketing and retention campaigns will likely be a focus in 2009 for operators as they compete for market share," in a fixed or slightly declining market, Fitch said in a statement.
Fitch also expects phone companies to continue losing traditional landline customers as more homes go completely wireless. The agency estimates 20 percent of homes were wireless in 2008, a figure likely to climb next year as "some retail consumers look to reduce duplicate services in an effort to save money."
A new lineup at the Federal Communications Commission under a Democratic administration could be tough on the industry as well, Fitch said, potentially instituting more stringent merger reviews and other measures aimed at protecting consumers.
Fitch Ratings sees trouble for cable and telecom industries from economy, regulatory changes
By Associated Press
12:55 PM EST, December 3, 2008
NEW YORK (AP) _ Fitch Ratings on Wednesday pointed to difficult times ahead for the cable and telecommunications industry as unemployment and home foreclosures balloon and it faces an uncertain regulatory landscape under a new president.
The ratings agency said the sector will likely see weaker cash flow and increased leverage. If the downturn becomes more severe, Fitch said it might downgrade some companies' credit ratings.
The housing slump, Fitch said, has pumped up competition among phone and cable companies for existing voice and video customers,
"Aggressive marketing and retention campaigns will likely be a focus in 2009 for operators as they compete for market share," in a fixed or slightly declining market, Fitch said in a statement.
Fitch also expects phone companies to continue losing traditional landline customers as more homes go completely wireless. The agency estimates 20 percent of homes were wireless in 2008, a figure likely to climb next year as "some retail consumers look to reduce duplicate services in an effort to save money."
A new lineup at the Federal Communications Commission under a Democratic administration could be tough on the industry as well, Fitch said, potentially instituting more stringent merger reviews and other measures aimed at protecting consumers.
