AT&T, Verizon Cope With Wireless World

The upcoming earnings reports of telecom giants AT&T (T Quote) and Verizon (VZ Quote) are expected to underscore the growing strength of their wireless divisions at the expense of their struggling landline operations.

With AT&T set to report third-quarter earnings Wednesday and Verizon to report its own the following Monday, the woes of their landline business segments should once again be on full display, as cash-pinched customers have continued to disconnect home phone access lines in favor of wireless connections.

"We think the incremental pressure on residential access lines is more of a function of wireless substitution (with consumers cutting the cord to save money) than incremental competition from cable," writes Chris Larsen, research analyst with Credit Suisse, in an earnings preview. ...