QUOTE AND NEWS
Telecom Ramblings  Apr 7  Comment 
There have been two key video announcements at the NAB event out in Las Vegas for Level 3. Given how dominant video bits are when it comes to overall internet traffic these days, it's a reminder of just how much more there could be in a few...
Cloud Computing  Apr 7  Comment 
BROOMFIELD, Colo. , April 7, 2014 /PRNewswire/ -- Level 3 Communications, Inc. (NYSE: LVLT) today announced it has received high scores in a variety of product categories evaluated by Gartner in its new report, "Critical Capabilities for U.S....
Cloud Computing  Apr 7  Comment 
LAS VEGAS , April 7, 2014 /PRNewswire/ -- Level 3 Communications, Inc. (NYSE: LVLT) today announced at the 2014 National Association of Broadcasters Show the recent launch of Level 3's Video Cloud Services, a cloud-based solution that moves,...
Cloud Computing  Apr 3  Comment 
BROOMFIELD, Colo. , April 3, 2014 /PRNewswire/ -- Level 3 Communications, Inc. (NYSE: LVLT) today announced it has teamed up with Elemental Technologies, a leading supplier of software-defined video solutions for content delivery to any device,...
DailyFinance  Apr 1  Comment 
MELVILLE, NY--(Marketwired - April 01, 2014) - Allied Pediatrics of New York, one of the largest private medical practices in the New York metropolitan area today announced that the majority of its 27 offices have received Level 3 recognition from...
FX Street  Mar 31  Comment 
EURUSD The 50-day SMA and the 50 fib level, 3 February lows to 13 March highs, have combined to... For more information, read our latest forex news and reports.
Cloud Computing  Mar 27  Comment 
BROOMFIELD, Colo. , March 27, 2014 /PRNewswire/ -- Level 3 Communications, Inc. (NYSE: LVLT) today announced Maggie Chan Jones , senior vice president of North America Marketing, is one of nine women to receive the Colorado Diversity Council's...
Cloud Computing  Mar 25  Comment 
BROOMFIELD, Colo. , March 25, 2014 /PRNewswire/ -- Level 3 Communications, Inc. (NYSE: LVLT) will release its first quarter 2014 results on Wednesday, April 30 , and will host a conference call at 10 a.m. ET . read more
SeekingAlpha  Mar 21  Comment 
By Dan Rayburn: Late yesterday, Netflix’s (NFLX) CEO published a blog post making the argument that “stronger” Net Neutrality is needed and that Netflix will “fight for the Internet”. This follows a post earlier in the week from Level 3...
Telecom Ramblings  Mar 19  Comment 
On Level 3's blog yesterday, the topic was "chicken" as it relates to traffic interconnection, net neutrality, and the last mile. The chicken part was in relation to the game Level 3 says some last mile operators are playing when it comes to...




 


Level 3 Communications (NYSE: LVLT) is a provider of a range of integrated communications services including network and Internet services, colocation service, media services and voice services. Its operations are divided into communications and coal mining.[1] Its largest segment, communications, consists of Core Network Services, Wholesale Voice Services, and Other Communications Services.[2] Its operations are primarily located in North America and Europe. As the demand for online video, gaming, and the streaming of movies and live events continues to rise, providers of these services are striking long-term contracts to IP Upstream carriers. Reaching deals with streaming companies has been critical to Level 3’s revenue growth. [3]

Business Growth

Level 3 reported a loss of $622 on $3.65 billion in 2010 revenues, compared to a loss of $618 million on $3.76 billion in revenues in 2009.[4] The declines in profitability and revenues can be partially attributed to a decline sales from large companies. In addition, expenses have risen as a result of high interest costs associated with the company’s debt load. However, contracts with companies providing streaming services has the potential of providing new sources of revenue growth.[5]

Trends and Forces

Visual streaming services provides new growth area for diversified communications companies

Increases in consumer demand for online video, online gaming, streaming full-length movies and lives events has the potential of providing significant growth opportunities for communication services providers. In 2010, Americans spent as much time online as they did watching TV, and Level 3 expects that the amount of time spent streaming online to increase.[6] Level 3’s broadcast services network and Vyvx capabilities delivered approximately 15,000 video feeds month as well as major live events like the Super Bowl, which the network has delivered for the past 22 years. In 2010, Level 3 Communications’ IP Upstream service was selected to be a primary content delivery network (CDN) for Netflix's fast-growing streaming service.[7] However, this rapid growth is not without its costs. Level 3 says it will double its storage capacity to help accommodate the new contract. Expanding its services has the potential of forcing the company to increases its debt load, which would lead to significantly higher costs.[8]

Global Economic Crisis has forced many customers to cut or delay several communication services

In an effort to control or reduce costs, many of Level 3’s customers have deferred or foregone purchases of services.[9] In addition, customers have also had trouble making periodic payments. As a result, there has been a decline in demand for communication services, which has resulted in lower revenues for Level 3. Meanwhile, utility costs have remained relatively stable for communication companies, leading to tighter margins.[10] However, as the result of a gradual pick up in economic activity, Level 3’s profit margins on the Core Network Services have improved.[11] Increased economic activity has the potential of leading to increased revenues and profits on Level 3’s core operations.[12]

Telecommunications Companies

While rising demand for IP Upstream services provides a new growth opportunity, a slow economic recovery has led to decline in demand for many other services provided by diversified communication companies. In addition, competition for fewer contacts for many networking services has led to depressed margins.

LVLT's top three competitors in telecommunications are:[13]

References

  1. Reuters.com: Company profile for LVLT
  2. Reuters.com: Company profile for LVLT
  3. LVLT Company 10-K for 2010
  4. Morningstar.com: financials for LVLT
  5. LVLT Annual Report for 2010
  6. LVLT Annual Report for 2010
  7. Yahoo! Finance: Netflix/Level 3 Deal Underscores Communication Service Trends
  8. Yahoo! Finance: Netflix/Level 3 Deal Underscores Communication Service Trends
  9. Yahoo! Finance: Netflix/Level 3 Deal Underscores Communication Service Trends
  10. Yahoo! Finance: Netflix/Level 3 Deal Underscores Communication Service Trends
  11. Yahoo! Finance: Level 3 1Q loss narrows
  12. Yahoo! Finance: Level 3 1Q loss narrows
  13. Hoovers: LVLT Competitor Fact Sheet. Retrieved on June 20, 2008.
  14. WikInvest: Sprint Nextel. Retrieved on June 26, 2008.
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