IPTV promise meets reality

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Parks Associates analyst Deepa Iyer agrees. She said most people who would consider switching their TV service to the phone companies' offering just want more of what they already can get from the cable operators at a better value.

"Early adopters may want to play around with new services," she said. "But most users just want to turn on the TV and sit back and be entertained. And they are happy to pay the same amount, as long as they get a bit more content or a few more features."

Iyer said new features that seem to most interest consumers include remote home monitoring, viewing caller-ID information on the TV, downloading music from the TV.

Even though AT&T will be selling a me-too TV service initially, the company likely won't cut prices drastically to win new customers. Fees charged by Verizon Communications, which has already begun rolling out its TV service, serve as good indicators of what to expect in terms of pricing.

While some customers have been able to individually negotiate reduced pricing in areas where Verizon's TV service is available, most cable companies have held their ground on pricing. Instead they've offered discounts on bundles of high-speed Internet access, telephone and video services.

For example, in New York City's Long Island suburbs, where Cablevision competes with Verizon's Fios fiber-optic service, the cable operator is offering a package of cable, high-speed Internet and phone service for $90 per month for the first year--very close in price to Verizon's Fios triple-play package, which costs $105 per month.

In Keller, Texas, the first city where Verizon offered TV service, the local cable operator, Charter Communications, is charging $70 for the first six months for a 3Mbps broadband and cable service. This is exactly the price Verizon charges for its new 5Mbps high-speed Internet access and TV offering.

Matching features--and price
Microsoft's Heckart said AT&T and other phone companies don't need to slash prices right away to win customers. According to a study Microsoft commissioned that surveyed over 800 potential IPTV consumers, AT&T and other phone companies offering TV service could get as much as 13 percent of the market simply by offering a service that matched cable's on features as well as price.

Even with predictions such as these, Cox Communications president Patrick Esser said he isn't too worried about competition from AT&T, which will compete in at least 40 percent of Cox's territory once AT&T completes its merger with BellSouth.

While AT&T takes its time deploying IPTV, Cox will continue to push new services and bundles into its existing customer base. The bundle is key, Esser said, because it makes customers more loyal to a service provider, which makes them less likely to switch to another company.

"As long as we can get one service into the home, we can work on selling a second service and a third service," he said. "Am I worried about competition from the phone companies? I worry about all competition, but I don't sit in fear. I sit in planning."

[TV James]

Am I worried about competition from the phone companies?

You should be in fear. If anyone can come in and match you on features and price, a large bunch of people are going to immediately jump ship.

But you know it won't stop there. They won't match you on price, they'll beat you. And they'll do it, offering more features.

Why? Because they don't want dissatisfied cable customers, they want all cable customers.

Finally, you'll have to actually compete and innovate. You'll have to go beyond boring commercials of guys with bad attitudes and a satellite dish on their heads being mean to customers and actually improve your service, improve your customer service, improve your installation process, offer more selection, more choices and compete.

It'll be yours to lose and if past progress is any indication, you will lose it.

[shineon4me]

Competition

Be nice to see Cox cable have a bit of competition.

Maybe they will stop raising their rates every
year at twice the rate of inflation.

[aabcdefghij987654321]

How long before a Microsoft virus/worm takes it down?

Even you M$ luvers can't deny it, hackers will be owning this Microsoft based system in no time.

[paulsecic]

Remember Webtv???????????????????

slow

[aabcdefghij987654321]

How often will my Microsoft IPTV crash and need to be rebooted?

You think that was a joke question?

[Jackson Cracker]

no joke

But since it's connected to the Internet it should
be able to just "phone home" to Microsoft a few times
a day and download the latest patches and Security Pack.

[206538395198018178908092208948]

How much will MS be invading my privacy?

I assume, based on past behavior, MS will be looking to collect as much data as they can get away with and reselling it to marketers or using it to monopolize another market.

[ralfthedog]

How about Verizon's service?

I will not use the service from Microsoft, but I might add the verizon service to my mix.

I just killed my cox cable TV (Bad analog, good digital) but I still use them for my Internet and my phone. I get my TV from Dish Network.

It would be cool to have a second channel of high speed Internet, as well as better reception on some low bandwidth channels like Scifi (Lots of macro pixels in dark spots on the screen).

I don't see it as a choice of one verses the other. All the services have advantages and disadvantages. Why not mix and match?

[libertyforall1776]

H.264/AVC (MPEG-4 Part 10) QuickTime Streaming Server option

AT&T should use a system based in UNIX like Mac OS X Server,
heck AT&T invented UNIX. Coupled with that they could use a H.
264/AVC (MPEG-4 Part 10) & an industrial strength version
QuickTime Streaming Server option, then they would have a
scalable solution from 3G mobile phones upto 1080P HD:

<a class="jive-link-external" href="http://www.apple.com/quicktime/streamingserver/" target="_newWindow">http://www.apple.com/quicktime/streamingserver/</a>

Forget the M$ instability...

[libertyforall1776]

H.264/AVC (MPEG-4 Part 10) & QuickTime Streaming Server option

AT&#38;T should use a system based in UNIX like Mac OS X Server,
heck AT&#38;T invented UNIX. Coupled with that they could use a H.
264/AVC (MPEG-4 Part 10) &#38; an industrial strength version
QuickTime Streaming Server option, then they would have a
scalable solution from 3G mobile phones upto 1080P HD:

<a class="jive-link-external" href="http://www.apple.com/quicktime/streamingserver/" target="_newWindow">http://www.apple.com/quicktime/streamingserver/</a>

Forget the M$ instability...

[barrelli]

i signed up for att/uverse when i called w/question, my 10 minute wait time was 45 minutes!! then told the system was down, call back monday. i will, to cancel my uverse bundle !! how can u expect any service when they cant even keep the order/service site up.