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CenturyLink to Sell Net Security

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Leading landline operator CenturyLink Inc. (CTL - Free Report) will offer the cyber-security solutions of Blue Ridge Networks to its government customers, as per a recently signed agreement. However, none of the parties disclosed the financial aspect of the deal.

Through several contract vehicles, CenturyLink will sell a diversified range of cyber protection products that include Blue Ridge's tailor-made, fully managed network security systems to various federal, state and local government clients. The company will also extend these services through its subsidiary Savvis – that renders cloud computing and managed hosting solutions for enterprises.

Chantilly, Va. based Blue Ridge Networks has been engaged in carting high-quality Internet safety offerings to government and industry customers for over 15 years. These security software enable users to stay protected from virus, spyware and malware, while being connected.

We believe that this alliance will establish a strong business relationship between CenturyLink and Blue Ridge Networks. Specialized cloud infrastructure and hosted IT solutions of CenturyLink combined with Blue Ridge’s excellent and affordable online crime protection solutions will aid the former in securing a strong market position. It will also help Blue Ridge gain market recognition. The regulatory clients of CenturyLink will get the advantage of best-in-class Internet security without buying any additional product.

We appreciate CenturyLink’s commitment to meet the growing customers’ demand for high-speed Internet and high-bandwidth services. In this regard, the company has chalked a detailed investment plan directed toward broadband expansion and enhancement, fiber-to-the-tower (FTTT) deployment, growth of managed hosting and cloud services, and faster IPTV offering.

However, the pressures of debt maturities, deteriorating legacy voice and access revenues and competition from other low-cost telecom operators like LEAP Wireless International Inc. plus the constant need for technology upgrades will continue to remain significant headwinds for the company.

CenturyLink, which has business tie-ups with Verzion Communications Inc. (VZ - Free Report) and SAP AG (SAP - Free Report) , has a Zacks Rank #3, implying a Hold rating.

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