Qwest Mulls Selling Its Nationwide Fiber Network

Qwest struggles to compete as its traditional landline business continues to shrink. In February, it reported it had cut 1,700 jobs from company payrolls.

William Gardner

April 2, 2009

2 Min Read
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Qwest may be interested in selling its nationwide fiber-optic network -- its crown jewel -- as the regional telecom company struggles to pay down its heavy debt load.

With most eligible suitors also struggling with heavy debt in the current global economic crises, Qwest's biggest challenge could well be to find a party with deep pockets. According to The Wall Street Journal, sources said a sale of the fiber-optic unit could raise between $2 billion and $3 billion. The company has declined to comment on the report.

As the smallest of the remaining so-called Baby Bells created in the breakup of the old AT&T monopoly more than two decades ago, Qwest has struggled to compete as its traditional landline business continues to shrink.

Qwest built up its fiber network over the years and in 2007 said it had tripled the network's geographic availability while quadrupling broadband capacity for existing customers. According to Qwest releases, the network's access points are available at all major U.S. business centers.

In addition, the Qwest network has extensive international connectivity. Users have reported deployments of private-line service using dense wavelength division multiplexing technology with speeds up to and surpassing 10 Gbps.

In February, Qwest reported that it had cut 1,700 jobs from company payrolls and would refrain from making cash contributions to the company's pension plan this year. Recent filings indicate Qwest has cash on hand of $575 million and almost $14 billion in debt.

A grim reminder of Qwest's once-high-flying days has been playing out in Denver's federal court system in recent months. Former CEO Joe Nacchio, found guilty by a jury of illegal insider trading a year ago, has filed an appeal with the U.S. Supreme Court in an attempt to avoid serving a prison term.

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