Big business rules telecom
SBC and Verizon aren't the only phone companies wooing big business customers.
Verizon Communications and SBC Communications aren't the only telephone companies wooing high-end business customers. On Thursday the UK's largest telecom operator BT Group said it has won a $3 billion contract with Reuters Group.
The deal is BTÂ’s biggest ever service contract, and it's part of a strategy to reduce the company's dependency on less lucrative local and long telephone service by providing fully managed and complex networks to multinational companies.
This is a similar strategy to the carriers in the United States. In fact, that is why SBC said it's buying AT&T, and why Verizon is buying MCI.
Big business customers could turn out to be the deciding factor in who triumphs in the new communications market. While these customers require a much higher degree of customer service and cutting edge technology than small and medium companies and consumers, profit margins for these services are much higher compared to the other two markets, Jon DeLuca, president and CEO of FiberNet, a local fiber and communications provider in New York City, said during a recent chat.
And because these networks have been custom built, customers are less likely to ditch their provider for someone else. While BT, Verizon and SBC tout big plans for offering video services or deploying fiber to homes, at the end of the day, the success of these projects could depend on how much cash they generate from winning over big business customers.