November 11, 2003 9:46 PM PST

Cablevision adds VoIP to broadband menu

Cablevision said Tuesday that it now offers Internet phone service to all of its cable broadband customers, giving it one of the largest potential markets for commercial voice over Internet protocol service in the United States.

As of Tuesday, the company's $35-a-month Optimum Voice dialing plan is available to 1 million high-speed Internet customers in the lucrative New York market, which the company claims is the most widely available so-called VoIP plan in the United States. Cablevision launched Optimum Voice on N.Y.'s Long Island in September.


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"We are well positioned to leverage in the introduction of this new voice service," said Tom Rutledge, Cablevision's president of cable and communications. Cablevision will soon bolster its dialing plan with new features such as keeping an old phone number when switching from a traditional phone company, he said.

VoIP calls use the Internet rather than the toll roads of a telephone company's network, and as a result are $20 to $30 cheaper than are monthly subscriptions from traditional phone companies such as Verizon Communications and BellSouth.

More than 1 million U.S. residents make free VoIP calls over their broadband connection; another 1 million subscribe to a commercial VoIP plans, which allow dialers to reach traditional home and business phone lines.

Most U.S. cable providers are launching VoIP plans to challenge the telephone companies' stranglehold on the local and long-distance phone market. Cablevision is the second major U.S. cable provider to make a bigger commitment to VoIP in less than a month.

In late October, Time Warner Cable announced plans to expand its "Digital Phone" service to four more cities. Meanwhile, the nation's top cable broadband providers, Cox Communications and Comcast, are still testing the technology, and both say they won't implement it until at least late next year.

Rutledge made his comments during a conference call to discuss Cablevision's wider-than-expected net loss of $104.6 million, or 36 cents a share, during the just-completed third quarter. Cablevision reported a net loss of $79.5 million, or 26 cents a share, in the same financial period a year ago.

Cablevision executives, during the same conference call, also reported that for the third time since June an internal audit found accounting irregularities. As a result, the company plans to restate first- and second-quarter earnings from this year.

 

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