I attended Qwest’s analyst day today in New York. New CEO Ed Mueller and CFO John Richardson spoke, and were joined by fellow executives John Yost and Stephanie Comfort for Q&A at the end.

It was a brief meeting - just two hours of presentations - followed by individual one-one-ones by Ed and John for some of the attendees, including yours truly.

The company’s come a long way since I first started following it, digging its way out of massive debt and big losses and back to reasonably respectable, if not stellar, profitability, and roughly stable revenues. And the company is forecasting more of the same, with an outlook of either stable or slightly declining revenues in 2008, with slightly higher profits.

The most telling thing about the event is that Qwest is taking a markedly different tack from the other big US carriers, and possibly from most other carriers in the developed world. Telecoms has always been a growth business, which is part of what drives valuations of tech stocks, and Verizon and AT&T certainly appear to be chasing that goal. But Qwest appears, at least temporarily, to have abandoned that goal, or at least to have set it aside, in favour of a focus on margins and free cash flow.

A lot of the talk during the meeting was about partnerships, but with the main focus on two partnerships that don’t drive a lot of revenue for the company - DirecTV and Sprint. Qwest is building out a fibre to the node network in 23 markets, covering 1.5 million households, in 2008, at a cost of $300 million, but it has no plans to deliver TV services over those cables. Instead, it will focus on faster broadband speeds, which it hopes will deliver higher prices and therefore raise ARPU, providing it with a revenue lift, while relying on the DirecTV partnership for TV services. Since it only makes around a 15% commission on those DirecTV sales, compared with Verizon and AT&T’s full revenue recognition from their TV sales, this is a pretty different strategy, and unlike to change substantially, although Mueller is planning to explore services like video on demand to integrate DirecTV and Qwest capability.

On the wireless side, the company is planning to rethink its partnership with Sprint and form a new partnership (possibly with Sprint again but likely with someone else) which would provide deeper integration but also a portfolio for Qwest that would more closely mirror its competitors’. Mueller appears confident that he can get this, but given that Sprint has historically been much more aggressive about MVNO activities than the other major wireless carriers, and Verizon and AT&T have very little incentive to play ball, I’m not hopeful. It looks like Mueller may be a little naive in this respect.

For what growth Qwest is chasing, it’s going to rely on that boost in broadband ARPU, more bundling to reduce churn in access lines, and better business revenues, from gaining share and starting to see results from the Networx contract. This doesn’t seem too unreasonable, although other than adding 250 salespeople it wasn’t obvious what was really going to change. Mueller appears to believe that the investments made by his predecessor are just now becoming aligned in such a way as to provide a platform for growth, but all the execution still lies ahead, and this may be another area where his optimism is ahead of reality. All that remains to be seen, however. I wish them luck, at any rate.