Peoples Choice Takes on Cox in Phoenix

Author:
Publish date:
Updated on

People's Choice TV Corp. (PCTV) is launching a two-way
wireless-Internet service in Phoenix within one month that it hopes will unseat Cox
Communications Inc.'s Cox@Home as the leader in the city's high-speed-data
market.

PCTV plans to officially launch the service in late
February or early March, as part of its "SpeedChoice" wireless-Internet service.

SpeedChoice has been available as a one-way service in the
Phoenix area since May, and it has already signed on about 1,800 subscribers, said Michael
Whalen, chief financial officer at Stamford, Conn.-based PCTV.

The service utilizes multichannel multipoint distribution
service -- a microwave technology that transmits video and data signals through the air.
However, MMDS has serious line-of-sight constraints, and customers must have virtually
obstacle-free paths between their homes and the main transmission tower.

Although the one-way SpeedChoice service has been
successful -- Whalen said it has already outpaced U S West's "MegaBit"
digital-subscriber-line service in Phoenix -- it requires a dedicated telephone line for
the upstream path to the headend. The new two-way service would eliminate the need for
that phone line.

Whalen said a few customers already have the two-way
service in Phoenix, but it will not be readily available until the official launch. As a
two-way service, SpeedChoice will have three upstream speeds: 33.6 kilobits per second,
128 kbps and 256 kbps. Downstream speeds will range from 1 megabit per second to 2 mbps.

Although pricing for the two-way service has not been
finalized, Whalen said that at least initially, the 33.6-kbps and 128-kbps services will
be priced comparably to SpeedChoice's one-way service -- $34.95 per month, plus an
additional monthly charge of $9.95 to lease the wireless cable modem.

Whalen said SpeedChoice can reach 90 percent of the homes
in Phoenix. That is better than U S West, which can reach between 35 percent and 50
percent of the homes in the area, and better than Cox, as its Cox@Home service is
available to about 40 percent of homes.

Cox officials did not return seeking comment.

Whalen admitted that the situation could change
dramatically when Cox completes its system upgrade in Phoenix. However, he hopes that the
advantage of being able to reach a greater number of homes now with two-way service will
help it competitively.

"We want to come out of 1999 with more residential
Internet customers than @Home [Network] and U S West in Phoenix," Whalen added.

PCTV also plans to offer a 128-channel digital-video
service to customers in Phoenix at around the same time that the two-way Internet service
is launched. Although the company has not set pricing for the video service, Whalen said
it could be bundled at a discount with the Internet offering.

However, PCTV will not push the video offering heavily, and
it will only provide it to Internet customers who request it.

"Cox is known as the cable and video provider that
also provides Internet service," Whalen said. "We want to be known as the
data-communications company that also has a video product."

PCTV plans to roll out SpeedChoice service in Salt Lake
City, Chicago and possibly Tucson, Ariz., by the second half of this year. Whalen said the
initial launches will be with one-way service, eventually moving to two-way.

The Chicago market will be the only exception, staying at
one-way service, because it will be targeted strictly to business customers.

Related