In 1995, Ameritech, BellSouth, Disney, GTE and SBC Communications entered into a joint venture to form Americast,which is based in Los Angeles. Just last week, the CEO stepped down because the telcos are no longer interested in programing. In fact, SBC has been trying to pull out of the deal for the past year. Growth in the long distance market is flat. Competition is intense.
Profit margins are small.
The business of the future in telecommunications is data transfer. That's why the RBOC's must get into long distance as soon as possible. According to their numbers, by the year 2010, more than 95 percent of all businesses will be using data networks, compared to approximately 50 percent today. GTE predicts that data revenues will go to 53 percent of total telecommunications revenues by 2006, while voice will decrease to 28 percent. These numbers represent a huge shift in services and revenues in a very compressed time period.