No AOL VoIP in Time Warner Markets


America Online Inc. soft-launched its voice-over-Internet-protocol telephony service Thursday, but the service -- priced at $29.99 per month for unlimited local and long-distance calling -- won’t be available to customers within the Time Warner Cable footprint, according to one analyst.

AOL and Time Warner Cable are units of Time Warner Inc. The official launch of the VoIP service is scheduled for Oct. 4, according to AOL press releases.

The product, called AOL Total Talk, requires that a terminal adapter (mailed out by AOL) be connected to the customer’s broadband network, enabling them to use their home telephones for the service.

AOL Total Talk also integrates call logs, voice mail and call-waiting with AOL or AIM e-mail accounts and instant messenger. And the service will have soft-phone features that allow customers to use Total Talk via their PC away from home.

In a research report, Fulcrum Global Partners LLC media analyst Richard Greenfield said he tried to sign up for the service in Manhattan (where Time Warner Cable has about 1 million subscribers) but was told by several customer-service representatives that the product is not available within Time Warner Cable’s footprint. He added that he was referred by those CSRs to Time Warner Cable’s VoIP service.

“The fact that Total Talk is $10 less expensive than [Time Warner] Cable’s ‘Digital Voice’ product and is seamlessly integrated into AOL [Instant Messenger] did not matter,” Greenfield wrote.

AOL spokeswoman Anne Bentley confirmed that the Total Talk product will not be available within Time Warner Cable’s footprint, but she added that it will not harm the service.

“That’s what we’ve decided as two companies working together,” Bentley said. “We’re working with Time Warner Cable to do the right things in their footprint, which includes leading with their Digital Phone offering.”

She continued, “We’re looking to leverage each other’s core competencies in voice and looking at ways, for example, that we could include some AOL features that might enhance Time Warner Cable’s advanced services. But, no, [not being able to sell voice in Time Warner Cable’s territory] is not an issue.”

Greenfield also noted that AOL is in the process of launching a new AIM product that incorporates software-based VoIP similar to that offered by Skype Technologies S.A. and Google Talk, which allows users to make PC-to-PC calls.

He predicted that AOL’s service could be transformed into a service that would allow users to make telephone calls outside the PC world (like “SkypeIn” and “SkypeOut”) in the next several months.

Although the roots of the noncompete agreement between AOL and Time Warner Cable lie in the agreement signed last year that enables AOL to migrate narrowband users to Time Warner Cable’s Road Runner high-speed-Internet service, Greenfield wrote that it signals that AOL and Time Warner Cable will increasingly compete.

Greenfield added that excluding Time Warner Cable’s territory from AOL Talk reinforces the notion that the cable assets should be divested completely from Time Warner, given that Time Warner chairman and CEO Dick Parsons has stated publicly that AOL is the company’s main growth engine for the future.

“We would prefer that nothing impede the growth of the AOL brand and its services (either Time Warner Cable should sign a Total Talk marketing arrangement or the noncompete should simply go away),” Greenfield wrote.