SBC to compete for Cable TV Subscribers
Posted 02 July 2004 - 01:29 PM
Web Posted: 06/23/2004 12:00 AM CDT
Express-News Business Writer
SBC Communications Inc., facing mounting competition from cable providers, said Tuesday it will spend up to $6 billion replacing aging copper lines in its network with fiber optics so that it can offer digital television and other new services.
Microsoft Corp. will provide the Internet protocol-based software that will allow the San Antonio-based telecommunications giant to deliver video over its lines. It's the first such deal Microsoft has struck with a phone company.
SBC will spend $4 billion to $6 billion over the next five years to install fiber in neighborhoods across its 13-state service territory. It wants to offer new, high-tech services to better combat cable firms, which are rolling out low-cost local and long-distance phone plans across the country.
"It will set the stage for full competition against cable," CEO Edward E. Whitacre said in a speech announcing the investment at the Supercomm telecom convention in Chicago.
SBC will begin testing video services within three months using the Microsoft system and will be "very, very aggressive with how fast and how broadly we roll it out," said Jeff Weber, SBC's vice president of corporate planning.
The upgrade also would allow SBC to offer a faster version of its speedy DSL Internet access and introduce Web-based calling services.
It's the first large-scale network investment by SBC since 1999's Project Pronto, a $6 billion initiative to expand DSL into new markets. The company scaled back capital spending in recent years as it's weathered an industry downturn and unfavorable regulations that required it to share its networks with rivals at a discount.
The launch of new services like video is vital for SBC and the other regional Bell companies, analysts said. Cable providers — which have built their own fiber networks in recent years — may end up being the Bells' ablest competitors.
Time Warner Cable this year is launching phone service in markets including San Antonio, and Cablevision Systems on Monday touched off fears of a telecom price war when it said it will offer a $90-a-month package that includes unlimited phone service, cable television and Internet access.
"It's going to be an interesting time in this business," said Bill Cram, analyst for Chicago's Loop Capital Markets. "The lines are blurring between the cable companies and the Bells. They're getting into each others' businesses."
SBC offers local and long-distance phone service and DSL over its copper lines but can only offer video as part of its package by selling satellite TV provider EchoStar's Dish Network.
In addition to facing pressure from the cable providers, SBC has lost millions of phone lines to wireless competitors and companies like AT&T, which compete in its local markets by leasing access to its networks.
Although SBC has mulled ambitious plans to bring fiber-optic lines directly to customer homes, the rollout announced Monday would only do so in new neighborhoods. In older neighborhoods, the company will take the less-expensive approach of taking fiber lines to neighborhood "nodes" that serve 400 to 500 homes.
While SBC may need the fiber expansion to offer a competitive service bundle, Cram wonders if the final benefits are worth the massive investment.
The company already carries some $18 billion in debt and is spending $41 billion together with partner BellSouth Corp. to buy AT&T Wireless Services to merge it into its Cingular Wireless partnership.
"If they spend that kind of money, I'd like to know what kind of revenues they're going to see in return," Cram said. "That's the question I have."
But other Bell companies see the value in investing in their networks to battle the cable threat.
Verizon Communications recently said it would spend $1 billion installing fiber and introduce video services next year.
And BellSouth this week said it plans to test offering video over its copper network within the next 12 months.
Officials with Time Warner, which expects to introduce its Internet-based phone service here in less than two months, said they're ready for more video competition from SBC. Satellite providers, including the SBC-aligned EchoStar, have aggressively gone after its customers for years.
Posted 03 July 2004 - 07:37 PM
Posted 09 July 2004 - 07:32 PM
STILL CONSIDERING CALLING THE PSC!! THE PHONE IS FIXED NOW--BUT IT IS THE IDEA BEHIND IT !!
THEIR MOTTO/PROCEDURE--------IF THEY LOSE POWER, OR GET AN ALARM AT A SITE---CALL THE POWER COMPANY--HARRASS THEM--EVEN THOUGHT IT IS BELLS PROBLEM!!!!
Posted 09 July 2004 - 09:33 PM
Posted 10 July 2004 - 01:54 PM
WAS pissedoff.gif WHEN I WENT TO BED---THE PHONE IN THE BEDROOM WAS WORKING--LIKE THE OTHER ONE---BEFORE THE BELL GUY CAME AND LEFT---- pissedoff.gif ---------------------NOW THE ONE IN THE BEDROOM IS DEAD AS HELL---AND I AIN'T CALLING BACK pissedoff.gif --I'LL DO IT MYSELF!!!!!!!!!!!
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