Windstream Closings 'Make Sense,' But Could Mean 'New Problems'

By Craig Galbraith Comments
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Windstream, best known as a business communications giant, said last week that it is closing 30 retail stores this month, something at least one industry insider says seems to be the right thing to do.

Calling it a well-run company with growth spurred by M&A over the last few years, Tech Analyst Jeff Kagan understands Windstream's decision because "the marketplace is changing and so is growth."

"Local phone companies are struggling if they are not expanding into other business lines. Will Windstream look different going forward?" Kagan queries. “Many customers prefer to do business and pay their bills online. So this move to close stores will let the company save money and makes sense."

But like any company making a choice such as this, the analyst wonders if subscribers will become angry and switch providers.

“One has to wonder ... about the customers who don’t have the ability to pay and do business online," Kagan said. "Will this will cause any new problems for Windstream going forward?"

The 30 retail outlets set to close are in 11 states. Sixty jobs are being cut as a result. Windstream says it's all due to customers turning to the Web to shop.

Looking to the company's future, Kagan implies that organic growth – as opposed to growth via acquisitions – should be part of WIndstream's plans.

“Windstream growth has been more through acquisitions. What about organic growth? What will Windstream look like going forward either through acquisitions or organically? So far acquisitions, changes and growth have been on the business side of the market. Will that continue?" asks Kagan.

Follow senior online managing editor @Craig_Galbraith on Twitter.

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