Traditional Telco Decline

If you look at the stock market performance over the last year you will see an alarming trend among traditional pure telco providers. Companies like IDT, Level3, Ibasis, and even Qwest have seen dramatic reductions in their overall stock prices.

>>IDT went from around $11.20 a share in March of 07 to roughly $3.70 a share in March 2008

>>Level3 went from around $6.20 a share in March of 07 to roughly $1.83 a share in March 2008

>>Ibasis went from around $10.00 a share in March of 07 to roughly $3.75 a share in March 2008

>>Qwest went from around $8.70 a share in March of 07 to roughly $5.09 a share in March 2008

This trend is no doubt not a coincidence and is reflective of these companies poor performances financially and a sign of the changing industry. Unless you are a Telco provider offering a mobile service like Verizon, Sprint and others, your business is not part of the future of Telecommunications. Analysts see mobile as the future and are not impressed by anything a traditional player can come up with... Even VOIP providers like Vonage and Packet8 are seen as yesterdays technology and not collecting much on the trading floor.

I have a feeling we will be seeing a lot of consolodation going on amoungst these traditional Teleco's in the coming months and years. It is the only way they will be able to continue as market share keeps dropping.