New Telergee Study: Rural telco operating margins declined again

A new financial survey of small rural telcos offers good and bad news about the rural telecom industry today.

On the plus side, small telcos’ Internet business continued to be strong. On the downside, the telcos once again saw operating margins decline. The survey also found that small telcos with video and wireless businesses continue to struggle to earn a profit with those business lines, while telcos with CLEC operations saw margins improve. The Telergee Alliance, a group of accounting firms that specialize in the rural telco market, has conducted the survey, called the Telergee Benchmarking Study, for several years. This year’s survey drew 221 responses, which should be a representative sample of the 800-odd incumbent rural telcos nationwide. It is based on data for calendar year 2010.