Now that AT&T Broadband is taking a seat next to merger partner Comcast Corp., one might think the multiple Internet-service provider train will finally leave cable's station.
But other MSOs don't seem to be rushing to buy tickets to come along for the ride.
Though both companies have strongly downplayed the timing of their latest deals with Internet-service providers — all inked within the past month — many have speculated that those arrangements are mostly meant to put on a good show for federal regulators eyeing the merger.
And for now, the Federal Communications Commission has lessened the specter of forced access, ruling last week that cable-modem service is an interstate information service not subject to common-carrier requirements.
AT&T last week signed an agreement with EarthLink Inc., allowing the No. 3 U.S. ISP to use its high-speed-data platform. That deal follows one Comcast signed March 4 with United Online, opening its cable-modem network to United's NetZero and Juno services.
EarthLink will launch first on AT&T's Seattle system sometime early this summer; Boston will be market No. 2. Plans call for additional cities in 2003.
It is the latest in a series of deals for EarthLink, which already offers cable-modem service in 24 Time Warner Cable markets. That MSO is committed to offering multiple ISP access as a condition of Time Warner Inc.'s January 2001 merger with the No. 1 ISP, America Online Inc.
Adding alternative ISPs now could indeed strengthen AT&T and Comcast's case with federal regulators.
AT&T Broadband CEO Bill Schleyer downplayed that connection. "Any regulatory issue is coincidental," he said during a conference call.
But Leichtman Research Group Inc. analyst Bruce Leichtman — a former MediaOne Group Inc. executive — was not convinced.
"It certainly is an olive branch to anybody who might be looking at this merger that they are going to try to be as cooperative as possible," he said. "You really can't throw out the political timing of this."
That's not to say the arrangement couldn't make business sense. As broadband is a three-horse race between DSL, cable and competitive ISPs, "if you have two of the horses, you will do pretty well," Leichtman said. "They are almost setting up a shadow brand.
"They will get paid in two of the three scenarios, and that is not a bad business proposition — especially if they signed a good enough deal."
Before the Internet economy soured, overbuilders such as WideOpenWest LLC and Western Integrated Networks (which does business as WINfirst) promised to offer multiple cable-modem ISPs, potentially putting pressure on incumbent MSOs to follow suit.
But overbuilders have withered — WINfirst has filed for Chapter 11 bankruptcy and WOW has discontinued its Denver-area new network buildout.
And while MSOs appear more receptive to opening their networks, so far, serious interest has appeared to be limited to companies involved in the merger-approval process.
Cablevision Systems Corp., for instance, isn't opposed to ISP access deals — but it's not negotiating with outside providers, either.
"We do not rule out trials with other ISPs and content providers or any of the numerous potential marketplace arrangements we might make with appropriate parties to improve customer service," said Gemma Toner, senior vice president of high-speed data products at the Bethpage, N.Y.-based MSO.
BUSY, AFTER AT HOME
Other cablers are still dealing with last month's shutdown of At Home Corp., and are preoccupied with their new cable-modem service operations.
Cox Communications Inc. — which has an ongoing trial with AOL and EarthLink in El Dorado, Ark. — is focused for now on fine-tuning its in-house network, and will soon switch Road Runner customers to its platform.
"We believe that it's important to evaluate the technical implications and to fully understand the business case before proceeding with additional trials and offerings," said Cox senior vice president of strategy and development Dallas Clement.
"Our priority has been to stabilize our new IP platform," Clement said. "We are excited about the prospects of multiple ISPs, and are now in a position to appropriately evaluate that opportunity."
Charter Communications Inc. originally had plans to trial dual Charter Pipeline and Excite@Home service, but that was shelved when At Home went into bankruptcy.
For now, Charter is not conducting any multiple ISP trials, spokesman Andy Morgan said.
Mediacom Communications Corp. is considering two proposals from major ISPs, according to senior vice president of marketing and consumer services John Pascarelli.
"We will consider anything that will help us drive high-speed-data penetration further into the marketplace," Pascarelli said. "We don't want to do it if it is just sheer shifting of our own product, but we do think there is a model where we can drive deeper penetration into the markets by using multiple ISPs."
MidContinent Cable vice president Tom Simmons said multiple ISP access isn't yet on the table for his company. But his MSO serves about 20,000 high-speed Internet subscribers in North and South Dakota, he noted.
"So our play in all of this — and the interest on the part of the ISPs — may be less than in New York or Chicago or Los Angeles," Simmons said. "But I know that at some particular point this is going to have to hit the table."