AT&T to Offer Web-TV, Broadband to Less Affluent By DIONNE SEARCEY Wall Street Journal
May 9, 2006; Page B4 http://online.wsj.com/article/SB114713201064447231.html?mod=technology_main_whats_news AT&T Inc., which has been criticized by cable rivals for targeting affluent households in its plans to launch an Internet-based television service, said it will offer the service to 5.5 million low-income households within three years. In a speech yesterday to the Detroit Economic Club, Edward Whitacre, AT&T's chairman and chief executive, also announced a deal with WildBlue Communications Inc. to provide broadband service to rural areas via satellite. Elected officials and government regulators have been pressuring phone companies to expand their high-speed Internet offers. Both moves are signs of the political battles AT&T, San Antonio, is waging as it competes with cable operators to offer consumers the most attractive packages of TV, voice and high-speed Internet services. One of the main arguments that cable operators have used against AT&T and Verizon Communications Inc., New York, is that the phone companies are focusing on affluent areas when rolling out their new TV offerings. Mr. Whitacre said the company will offer its service to 5.5 million low-income households in 41 markets within three years. In the past, AT&T has said it plans to reach nearly 19 million households with TV service in its 13-state region by 2008. The company is expected to expand its TV offerings to the southern states in BellSouth Corp.'s home territory if its planned $67 billion takeover of BellSouth is approved by regulators. So far AT&T has launched TV service to only a small number of customers in San Antonio, though it plans to expand the offering in coming months. Verizon is farther along, having rolled out TV to dozens of communities in Texas, New York, Virginia and elsewhere. Phone companies such as AT&T and Verizon are increasingly relying on speedy Internet service to form the backbone of their offerings rather than traditional phone service, which is a shrinking business as customers turn to wireless and less-expensive Internet calling. In a further step in this direction, Verizon yesterday announced it had bought a stake in online-videogame company Super Computer International Inc. Terms of the deal weren't disclosed. Mr. Whitacre said starting this month AT&T would begin using satellite and new fixed wireless technologies to offer broadband service to households in rural areas that can't get it over phone lines. The WildBlue satellite service, starting at $49.95 a month, will be more expensive than traditional broadband from phone companies and won't be as fast as their fastest offerings. The venture with WildBlue represents a potential breakthrough for the U.S. satellite industry, which has offered Internet connections for years but until now never had the support of a major partner with such deep pockets and marketing clout. Cable companies are trying to delay phone companies in their TV rollouts by trying to get local governments to force them to make service available to all residents, not just select areas. A recent report from Broadband Everywhere, a group aligned with the cable industry, said that more than 90% of communities where phone companies are rolling out the fiber that delivers TV are above the national median income. AT&T spokesman Michael Coe said the pledge to serve low-income customers was "an attempt to show those critics they're incorrect in assumptions they've made." A Verizon spokesman called the red-lining charges "nonsense" and said that low-income households are among the best customers. In his speech, Mr. Whitacre also said AT&T has developed a technology that would allow customers to register the sound of their voices to be used as a form of identification when making Internet purchases. It could help online retailers fight credit-card fraud, he said. ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu Reply with a "Thank you" if you liked this post. _____________________________ MEDIANEWS mailing list medianews@twiar.org To unsubscribe send an email to: [EMAIL PROTECTED]
