News

MediaOne Takes to Phones in Atlanta

2/01/1998 7:00 PM Eastern

Cable telephony has come to Atlanta.

MediaOne officially launched its much-anticipated local
facilities-based phone service in the Atlanta metropolitan area last week in about 1,000
homes -- a number that the cable operator hopes will expand to 150,000 by the end of the
year.

MediaOne is offering consumers in neighborhoods that it has
rewired with hybrid fiber-coaxial 750-megahertz lines a handful of incentives and
features, including free phone installation and the ability to keep their existing phone
numbers. For $24.75 per month, customers can have one line with features. For $35.95, they
get two lines -- one basic line and one with the features.

Those features include caller ID, call waiting, call
forwarding and speed dialing.

Although the MSO is initially pricing its service at
approximately 20 percent lower than comparable BellSouth Corp. offerings, Dale Ordoyne,
MediaOne's vice president of marketing in Atlanta, said the cable company is
emphasizing the added value of phone service to customers, and not the price comparison.

Ordoyne said there would be no direct reference to
BellSouth in marketing materials.

'It's a value proposition,' he said,
'not a price war.'

BellSouth spokesman Bill McCloskey said the regional Bell
operating company wouldn't directly attack MediaOne, but it would use an ongoing
image campaign, 'It Takes a Neighbor to Know a Neighbor,' to 'remind'
customers of its long-standing relationship with them.

In fact, BellSouth appeared to welcome MediaOne's
entry into the local phone market as leverage in its campaign to get into the
long-distance business -- a market fiercely guarded by potential competitors like AT&T
Corp.

RBOCs can't get into the lucrative long-distance
market until state regulators determine that there is legitimate local competition.

'It's a mystery to us why upstarts like MediaOne
can come in and figure out how to make [local phone service] work, when established giants
like AT&T claim that they can't,' McCloskey said.

Ordoyne said MediaOne would take a 'very
targeted,' tactical approach to marketing the new phone service, concentrating on
door hangers, direct mail, telemarketing and direct sales for a least a year.

Marketing materials will sell both phone service and
high-speed Internet access to customers in the rebuilt neighborhoods.

Ordoyne also said the phone-service pitch would focus on
the two-line offering.

About 80 percent of MediaOne's early trial customers
opted for the two-line service, he added.

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