Level 3 Communications Has Learned Its Lesson

By Author: sudhir singh
Total Articles: 35
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Level 3 Communications is no stranger to acquisitions. Between 2005 and 2007 alone, the international communications company successfully completed 8 different acquisitions – and learned a great deal in the process. Moving forward, the carrier believes that all that practice will lead them toward a smooth, customer-focused integration with Global Crossing.

In September of 2011, federal regulators approved Level 3’s $3 billion agreement to purchase Global Crossing. The merger united what were once two of the world’s largest fiber-based providers of telecom solutions, creating a single enterprise with network ownership in more than 50 countries and connections to over 70 countries.

At the time of the approval, Level 3’s president and COO, Jeff Storey, stated that the merger will create “a new kind of competitor that will offer customers the network reach, scale and reliability they are looking for, all from a team steeped in an entrepreneurial culture and singularly focused on the customer experience.”

Now, nearly 8 months later, the carrier is still holding true to its word. Subsequent ...
... to Level 3’s first-quarter results, Nick Yu and Donna Jaegers – D.A. Davidson & Co. analysts – reported that the provider is making a coordinated effort to thwart previous mistakes while integrating Global Crossing. According to Yu and Jaegers, Level 3 is greatly concerned with customer satisfaction throughout the integration process, and has put a number of “'early warning' systems in place” that will track provisioning issues and trouble ticket resolutions.

The analysts explained that in prior acquisitions, the communications carrier was more concerned about attaining synergies than it was focused on the customer experience. As a result, customers became frustrated with extended install times, provisioning issues, and when all was said and done Level 3 ended up losing revenue. This time around, however, Level 3 has learned its lesson and will be “laser focused on the customer experience,” said Yu.

But not all analysts are painting such a rosy picture; in a May 4th letter to investors, Canaccord Genuity analysts Eric Chu and Greg Miller wrote that they, “have no reason to expect the Global Crossing acquisition will be different," and recommended a hold on the carrier’s stock after it underperformed in the wake of numerous acquisitions.

About Level 3 Communications

Level 3 delivers what business demands. Headquartered in Broomfield, Colorado, Level 3 Communications is one of only six Tier 1 Internet providers in the world. As one of the largest IP transit networks in North America and Europe, Level 3 delivers premier data, voice and video services, and is currently ranked as one of the most connected Internet Internet Service Providers(ISPs).