Ready, Fire, Aim! - Mihail's Public Blog: Cable TV, broadband and local calls

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Thursday, September 5, 2002

Cable TV, broadband and local calls

Although cable's beachhead for providing phone service over cable wires is tiny when compared with the 102.2 million U.S. households with phone service and the $140 billion in revenues that comes in annually, it has the phone companies worred. And it should have consumers like myself worried too since cable service by itself is so damn pricey. Maybe the pain will be lessened if I can at least reduce my phone costs.

The two leaders in this business, AT&T Corp.'s AT&T Broadband unit and Cox Communications Inc., have signed up over 1.7 million local telephone customers and are adding new ones at a rate of more than 60,000 a month. Other industry leaders, including Comcast Corp. and AOL Time Warner Inc.'s Time Warner Cable, plan to launch cable phone service next year using a less expensive Internet-based technology that transmits sound digitally.

...As it turns out, subscribers who sign up for phone service along with cable TV and high-speed Internet are more likely to stay loyal to their cable company and not switch to, say, satellite TV. "As a stand-alone business, telephone is very strong," says David Pugliese, a Cox vice president in sales and new-product marketing. "It's even greater for us as a piece of a three-product bundle."

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