Windstream-Avaya Ink UC Deal
Windstream Corporation (WIN) has announced a partnership with Avaya to expand its managed Unified Communications (:UC). Avaya, a U.S.-based provider of business communications and collaboration systems, will provide Windstream’s UC services its suite of communication solutions – Aura – that is complemented by the cloud platform of Windstream.
The collaboration will provide users easy access with advanced UC functionality such as mobile and desktop integration.
We appreciate Windstream’s focus on expanding its service offerings to businesses with VoIP services, data bundles, cloud and managed services; data center co-location; fiber transport as well as increasing distribution channels. Apart from Avaya, the company has also teamed up with LifeSize Communications, a division of Logitech International SA (LOGI) to provide high definition (HD) video conferencing services to customers using Windstream's IP networking solutions.
With the acquisition of the leading broadband service provider PAETEC Holding Corp in Dec 2011, the company aims to gain significant momentum in its enterprise market with nationwide coverage of fiber network cables. The acquisition increased opportunities in cloud computing and managed services. It also attracted business customers across many locations. Windstream is also planning to introduce customized business solutions that will improve its competitive position.
In the retail business, Windstream has re-branded its consumer offerings with advanced Internet and entertainment services that come with a Roku box, including several entertainment applications to enhance pay TV service. The company’s strategy of bundling consumer services with high-speed Internet service aids subscriber growth and at the same time reduces churn (the tendency of customers to switch providers).
We remain optimistic on the company’s performance based on a lucrative bundle of service offerings, an expanding customer base and various strategic measures. The company’s strong operational base is expected to drive growth in business and consumer channels with synergies from the acquisitions.
However, we remain concerned about competitive pressure from other industry players such as Frontier Communications (FTR) and Consolidated Communications (CNSL), constant upgrades in the technological scenario as well as continued access-line erosion.
Currently, Windstream has a Zacks Rank #3 (Hold).
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