Monday, May 01, 2006

Level 3 snaps up another network infrastructure company

Level 3 Coomunications announced today the purchase of closely held TelCove Inc. for about $1 billion and demonstrated another step in their roll-up of the telecomms network industry.

In purchasing TelCove, of Canonsburg, Pa., Level 3 will gain access to new infrastructure on the East Coast, including 22,000 miles of data-transmission lines serving 70 markets. Combined, the new Level 3, will provide ever more competition to network infrastructure leaders AT&T and Verizon.

And how things have changed. Only a few years ago there was a glut of telecom capacity the size of a butter mountain. Now, thanks to broadband and data hungry video transmission - the demand for network capacity is soaring again.

And video over digital networks has only just begun it's hockey stick growth - so given that a rising tide lifts all ships, Level 3 looks back on the up even though profits seem to keep alluding them. But, that shouldn't last much longer.

No comments: