MSO Leaders Bullish on Voice
By Ted Hearn -- Multichannel News, 3/20/2006 1:05:00 PM
Washington -- Cable executives said Monday that they were upbeat about competing with AT&T Inc. and Verizon Communications Inc. as the two phone giants prepare a massive invasion of cable markets backed by multibillion-dollar network upgrades.
Cox Communications Inc., Cablevision Systems Corp. and Time Warner Cable were first among the large cable operators to seize the local-phone opportunity.
"We're taking about one point of landline market share per month,” Cablevision president and chief operating officer John Bickham said at a Cable Television Public Affairs Association forum here. "So it's not surprising that the phone companies are starting to pull their hair out."
AT&T and Verizon, he added, were a long way off from having the network capabilities of Cablevision. When the phone companies have finished their upgrades, they will still need to learn how to sell video programming.
“It's not in their DNA at all to be great direct marketers,” Bickham said.
Cable operators have about 5 million voice customers. About 16% of Cablevision’s homes passed have taken its digital voice service, Bickham said.
Charter Communications Inc. CEO Neil Smit -- who is pushing his company into voice over Internet protocol -- said phone companies would never be as successful in video as cable would be in voice.
"We'll have many more telephone customers than they will have video customers. I think video is a much tougher proposition,” Smit said.
Time Warner Cable COO Landel Hobbs said offering consumers a voice, video and high-speed-data package has reduced churn and helped to produce an increase in basic-cable penetration.
“You can see it in our operating results,” he added.
Hobbs, addressing the net-neutrality issue, said the federal government should resist regulating the management of broadband networks. Companies, he said, needed to experiment with business models to prevent bandwidth-hogging services from clogging the Internet.
"I don't know what particular model is going to fall out yet, but it will develop if Washington steps back and lets the free-market system work,” Hobbs said.
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