Qwest To Exit Wireless Business In October

Customers have two months to switch to Verizon Wireless

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August 19, 2009
Qwest has informed its customers that they have two months to switch to another provider, as it will be discontinuing wireless phone service by October 31st, 2009.

The Denver, Colorado-based company, which originally partnered with Sprint Nextel to provide voice and broadband services to customers in 2004, switched to Verizon Wireless last year. Qwest began transitioning its customers to Verizon Wireless in August of 2008, and the company claimed it has successfully switched "tens of thousands" of customers.

Customers were informed by Qwest that they could make the switch to Verizon Wireless within 60 days without incurring any termination or cancellation fees.

Qwest, which has customers in 14 Western and Midwestern states, attempted to profit through entering the Mobile Virtual Network Operator (MVNO) business, where a wireless carrier rebrands and resells another company's services to particular markets. The MVNO market has been seen as a growth opportunity, as cost-conscious consumers switch to prepaid plans rather than all-you-can-eat monthly plans for their services.

Qwest, however, was unsuccessful in profiting off the resale of Sprint's and Verizon's services. Of Qwest's total 763,000 wireless customers, only 185,000 were remaining with its MVNO service, said Chief Operating Officer Tom Richards during the company's quarterly earnings call on July 29.

Qwest plans to focus on its landline phone service and reselling bundled "triple-play" phone/cable/Internet offerings from other companies. Qwest also partners with DirecTV to resell its satellite television service.

Coincidentally, The Department of Justice said yesterday that it would let stand a ruling by a federal appeals court that shortened the sentence of former Qwest CEO Joe Nacchio, convicted in 2007 for insider stock trading. The court ruled that Nacchio's sentence should be reduced due to a miscalculation in how much money he had allegedly made as a result of the trades.