News reports, initiated in the Wall Street Journal, suggest that CenturyLink and Level 3 Communications are on the cusp of a merger agreement. Reuters' sources suggested a deal could be announced as soon as next week.
Neither company has commented on the reports.
A CenturyLink/Level 3 merger would create a communications systems company with a broad portfolio of business and residential services. CenturyLink has invested heavily in recent years in its residential broadband infrastructure, as well as its business-targeted fiber-optic network footprint (see, for example, "CenturyLink offers gigabit services to 14,000 MTUs"). The company also has moved aggressively into cloud-based and software-defined networking (SDN) enabled offerings for businesses (see "CenturyLink offers managed SD-WAN service" and "CenturyLink buys Active Broadband Networks SDN/NFV assets"). It also offers wholesale services.
Level 3, meanwhile, is focused on the provision of business and related services. It offers services such as SIP, security, cloud, and hybrid WAN to enterprises, healthcare, research and education, and related customers. It also offers content distribution network services to content providers as well as wholesale capacity to other service providers. The company has an ownership stake in several submarine cable systems as part of these endeavors.
Level 3 was said to be exploring its strategic options as recently as this past July (see "WAL: Level 3 reportedly exploring 'strategic options,' Comcast fingered as possible suitor"). The company reported revenue of $2.056 billion for its most recently reported quarter (the second quarter of 2016) Full-year 2015 revenues were $8.229 billion, up from $8.123 billion in 2014.
CenturyLink reported 2Q16 revenues of $4.40 billion and total year 2015 revenues of $17.9 billion, down from the $18 billion in earned in 2014.
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Stephen Hardy | Editorial Director and Associate Publisher
Stephen Hardy has covered fiber optics for more than 15 years, and communications and technology for more than 30 years. He is responsible for establishing and executing Lightwave's editorial strategy across its digital magazine, website, newsletters, research and other information products. He has won multiple awards for his writing.
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