Cable: Phoning It In

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There was a lot of talk about phones for a cable convention for a cable public affairs association.

That was at the Cable Television Public Affairs Association forum in Washington, where some cable operators argued they would pick up more phone customers than the telcos would add video service.

For example, John Bickham, President, of Cable and Communications for Cablevision, said that on Long Island, 27% of homes passed take phone service from Cablevision, with the company picking up a point of landline market share a month. He said he was not surprised that the phone companies "are starting to pull their hair out."

Time Warner CEO Landel Hobbs said cable companies were well positioned in telephony, offering the triple play of video, voice and data, and potentially adding wireless service to make it a quadruple play.

Bickham said one advantage for cable is its marketing experience. Phone companies aren't great marketers," he said, " it isn't in their DNA."

Verizon spokeswoman Sharon Cohen-Hagar begged to differ. "It think that's a really ridiculous thing to say," she commented during a break from the TeleomNext show in Las Vegas, where the phone companies are talking telco video strategy. "Our marketing is paying off. We have a very localized marketing strategy that we're seeing the dividends of."

Of  the suggestion that cable will grab more phone company customers that the other way around, Cohen-Hagar pointed to comments by Verizon CEO Ivan Seidenberg  that it is a "multi-year plan" that the company is "on course to make work."
Charter President Neil Smit said that while it will take Bell South and AT&T a year to 18 months to get that deal approved, cable will be bundling its service and picking up customers. He also talked of the potential quadruple play by adding wireless to the mix.

On the cable end, the execs on the morning CTPAA panel were high on switching, saying that it would ultimately allow cable to offer a lot more channels without as much concern as today about bandwidth constraints.

Switching allows a cable system to only provide the bandwidth when a customer actually switches the channel on, so lighter-used channels will not be sucking up bandwidth until the bandwidth is needed. He said two of his 29 divisions are employing switching technology today, and he anticipates 6 to 8 will be doing so by the end of the year.

Bickham said Cablevision was to try and grab viewers back from satellite by offering some 60 international channels which via switched technology, though he said it the transition to a switched world would take five or six years.

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