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July 05, 2005
SBC fights Cable; Offers Free Services
Cable companies have been doing very well with their Voice over IP bundle (VoIP). Om Malik reported recently that Time Warner is having 'monster' growth this year and is adding 10,000 customers every week. Cablevision is adding 7000 a day.
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In an attempt to stem the loss of subscribers to cable companies, SBC said that it would offer three free months of broadband Internet service and satellite television to new and existing phone customers who cancel their cable services.
From the New York Times dated June 29, 2005:
SBC said the offer was intended to pull customers away from competitors like Cablevision, Comcast and Time Warner Cable, which provide Internet, television and phone services over their cable wires.
"In the space that we live in and operate in, cable has become quickly our No. 1 competitor," said Michael Grasso, SBC's executive director of offer management. "We have found that people who have more than one service with SBC remain customers longer."
SBC lost 4.4 percent of its phone customers in the one-year period ended in March, the most recent data available, said Todd Rosenbluth, a telecommunications equity analyst with Standard & Poor's. Mr. Rosenbluth noted that SBC had cut its broadband prices already this year and that offering free Internet and satellite service for three months is an even more aggressive move.
Starting on Friday, customers in the 13 states that SBC serves can receive free Yahoo DSL service and free Dish Network satellite television service for three months if they submit recent cable bills showing they were cable company customers for the services they want to try free. The satellite service is available without strings attached, but the D.S.L. service requires a one-year contract, which includes the three free months.
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I questioned SBC's strategy of testing IPTV in Texas a while ago. Read that critique. |
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Today, SBC provides television by co-marketing with DirectTV, but they are investing a lot of money into IPTV. |
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