Simple still sells for telco IPOs

The Valley likes to stuff money into the next telecommunication technology that will tear down the traditional phone company monopolies. And ya’ll know we love to write about them. But the public markets haven’t been too keen on some of the more high-risk, high-spending telcom services. They want simple stuff – stuff they can understand, like cellular phone services.

That might explain why MetroPCS, a flat rate cellular carrier was able to raise over a billion dollars from the stock market this week. Forbes says the reason why MetroPCS did well is it’s making money and doesn’t take too radical an approach to the phone world. True enough. An indicator that MetroPCS will likely stay strong is that cell phone operator Leap Wireless, another flat rate wireless provider, has seen its shares jump by over 50% over the last 6 months.

In comparison, the more exotic telecom services offerings – VoIP provider Vonage and WiMAX operator Clearwire – are swirling down the toilet. This year is touted as the return of the tech IPO, but for telco startups, the public markets are still shying away from anything too far outside the standard.

loading

Comments have been disabled for this post