Tuesday, November 16, 2004

VoIP - Game of Chicken? 

"None of the Bells have a choice," telecom consultant Raul Katz told USA Today. SBC senior VP Scott Helbing put it more directly: "It's a game of chicken, to a certain extent," he told the newspaper. "Cable operators have been pushing to get into our bread-and-butter business, and now we're going to get into theirs."

www.washingtonpost.com features VoIP: A Shot in Telecom's Arm today (registration req), a very interesting article about the race between cable operators and baby bells, triggered by SBC Communications as the latest Baby Bell to jump headlong into the world of Internet telephony, a move aimed at boosting its offerings in an increasingly competitive broadband marketplace and at catching up with upstart 'Net phone players like Vonage that have seen a surge in business as consumers look for cheaper calling plans.

But SBC's move also amounts to "the latest salvo in what's fast becoming a high-stakes race between phone and cable-TV companies. Both are hoping to woo customers with a full menu of phone, data and video services," USA Today reported.

Related to Comcast see also VoIP Watch and Telepocalypse

USA Today noted, however, that SBC still relies on traditional phone service for its bottom line. .... But SBC, Verizon and the other big carriers really don't have a choice. Cable companies are rapidly rolling out Internet phone service. ... At the same time, cell phones are gaining favor as a substitute for traditional 'wired' phones. The two developments, driven by advances in technology, are forcing SBC and the others to respond. Verizon, based in New York, already offers VoIP for consumers."

The Ann Arbor News of Michigan on Sunday reported that consumers are set to be the big winners in the VoIP wars: "Comcast Corp. and SBC Communications Inc. have already revved up their broadband engines to attract the coveted high-speed Internet customer. But the next two years could bring nothing short of an broadband arms race, as cable TV and Baby Bell phone companies joust to furnish your home's every communication and entertainment need. Phone companies say they're committed to spending billions to build fiber-optic networks capable of bringing high-definition TV, Internet services and phone systems directly to homes. Meanwhile, cable firms hope to cut into the phone market by rolling out Internet-based calling, possibly next year," the paper said. "For consumers, the rivalry could yield a cornucopia of new features -- and possibly lower prices - as the nation's seemingly insatiable thirst for a flash-like Web pace persists. But some observers wonder whether broadband proliferation will result in real competition -- or merely create cable-only or fiber-only territories. One thing is certain: The lines traditionally separating cable and telephone companies are blurring."

Comments: Post a Comment

This page is powered by Blogger. Isn't yours?