Leading telecom company
) is expanding its Digital Life package, home security and
automation service in new markets - Orlando, Providence, Virginia
Beach, Rochester, Buffalo and Syracuse. Customers in these
markets can experience demo services and can also buy Digital
Life from AT&T's retail outlets. AT&T's digital life -
already available in 39 markets - is likely to reach 50 markets
by 2013 end.
In Apr 2013, AT&T unveiled its Digital Life package in 15
cities including Los Angeles, Chicago, San Francisco and Miami.
The product includes security cameras, thermostats and locks that
can be controlled from phones and tablets. We believe that
product diversification will enable AT&T to grow beyond its
legacy market and generate incremental revenues in the coming
The company stated that the market for home security services
remains significantly unaddressed as only 1% of the U.S.
households have an automated security system. As a result, the
company sees financial opportunity in the $18 billion market for
automated home security systems. AT&T has so far seen more
success in this market compared to its peers thanks to its own
technology in home security digital products and adequate
marketing and promotional measures.
The company already enjoys strong momentum in both wireline
and wireless businesses. While continued strength in smartphones
is fueling growth in wireless business, wireline is benefiting
from growth in its U-verse and strategic services. AT&T is
the leader in WiFi (wireless broadband) connectivity with over
30,000 domestic and 190,000 international hotspots. We believe
the addition of Disney content will fuel growth in U-verse
services, resulting in higher data revenues in the wireline
Other positive attributes for the company include a strategic
realignment initiative and a healthy financial profile. However,
persistent access line losses, competitive pressure from the
) and regulatory issues will likely weigh on the stock in the
AT&T retains a Zacks Rank #3 (Hold).
Other stock to consider in this sector include
Cincinnati Bell Inc.
), which retains a Zacks Rank #1 (Strong Buy) and
Hawaiian Telcom Holdco, Inc.
), which has a Zaclks Rank #2 (Buy)
CINCINNATI BELL (CBB): Free Stock Analysis
HAWAIIAN TELCOM (HCOM): Free Stock Analysis
AT&T INC (T): Free Stock Analysis Report
VERIZON COMM (VZ): Free Stock Analysis Report
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