Wire wars heat up

Wire wars heat up

June 5th, 2011 by Ellis Smith in Business Around the Region

The Chattanooga telecommunications market has been the focus of an increasingly public battle for the hearts and minds of consumers, with the three major players - Comcast, AT&T and EPB - rolling out new features and billboard marketing campaigns on a monthly basis.

The city-owned utility, EPB, made a nationwide splash with the announcement last September that it had activated the only gigabit broadband residential service in the United States, and it since has been steadily gaining customers.

The utility now boasts 27,400 residential customers and 2,700 business users in Chattanooga, many of whom have switched from other broadband providers, according to spokeswoman Lacie Newton.

Since the launch of its fiber product, EPB has doubled the speed of its Internet offerings at no extra charge, added more channels and begun growing its Video on Demand library, similar to Comcast's Xfinity On Demand.

But the war for the living room is far from over.

Where private competitors Comcast and AT&T don't compete on broadband speed to every home, they've been steadily adding more options to keep residential customers from switching to a competitor or simply accessing content through a pure Internet connection.

Security from Anywhere

The idea is to remove the incentive for customers to simply buy a cheap, fast Internet connection and forego television and telephone service.

Comcast, America's largest cable TV provider, does this by bundling all these services together and integrating them to allow customers to run anything from anywhere, anytime, said Jim Weigert, vice president and general manager of Comcast in Chattanooga.

"Comcast has always used Chattanooga as sort of a test lab," he said.

With that in mind, the company is rolling out new Xfinity services that enable customers to literally connect all their devices together with a single bill.

In addition to more On Demand movies and channels, the cable operator has begun to add new businesses and options, branching out into new areas such as home security and universal tech support.

Xfinity Signature Support allows customers who pay a $20 monthly fee to get tech support on nearly any device associated with Comcast's service, similar to Best Buy's Geek Squad, and equipment protection on anything from televisions to printers.

In a more futuristic foray, Comcast has conducted a soft launch of its Xfinity Home Security, product, which combines regular home security monitoring with Web 2.0 connectivity.

Any web-connected device, whether high-tech like video cameras and motion sensors or low-tech like deadbolts and thermostats, can be networked and accessed from anywhere, as part of Comcast's convergence plan, Weigert said.

The system can take a video of an intruder and stream it to a user's iPad, he said, or a user conscientious about his power usage could turn down the thermostat from his Android device to save energy while in another state.

That same user then can activate On Demand and watch an episode of "House" that he missed because he was at the airport, or set the DVR to record a re-run of "Cheers." If the thermostat or DVR doesn't respond, he can call Comcast's tech support for help with the hardware.

"It's really a turning point for converged, advanced services," Weigert said.

MA BELL rumbles on

AT&T hasn't sat still either, signing up 3.7 million Internet users since its launch, including nearly 1 million users in the last year alone, the company reported. Comcast originally bought AT&T's cable assets in 2002, so Ma Bell had to build its DSL network from the ground up.

The flexibility of building its own network has allowed AT&T to offer high-tech applications through U-Verse, including tight interactivity between its telephone, television and Internet services, according to Cathy Lewandowski, senior public relations manager for AT&T Strategic Communications.

The company claims to be the first provider to allow users to watch recorded shows from a single DVR on any connected TV in the home, and users now can schedule and watch TV on a smartphone. The company also has worked to leverage its Internet Protocol service to work with other devices, such as the popular gaming console Xbox 360, Lewandowski said.

And while AT&T doesn't heavily advertise it, the company also offers gigabit service, though it's targeted mainly at business users.

The telecom giant's proposition for customers is one of value for the dollar, speed and connectivity, Lewandowski said, rather than just focusing on raw speed or a variety of mobile applications.

"We're focused on giving customers what they've shown they want, especially in today's economy: speed, value and mobility at a price they can afford," she said.

AT&T also has worked to stay competitive on the wireless side of its business, Lewandowski said, pumping $1.2 billion into its wireless and wireline infrastructure in 2008 through 2010 to build out its 4G capabilities.

The Internet protocol battle

In tandem with its goal of offering every service imaginable as an integrated package from the cloud, Comcast has also been working on both its customer service itself and the public's perception of it.

EPB's service in Chattanooga has received good marks on blogs, but Comcast and AT&T routinely take a beating online for their faults, both real and perceived.

"We monitor the blogs and the online forums, that's where you see the vocal complaints," Weigert said. "We follow back up with those people and try to figure out what we can do to help."

The company, like AT&T, has struggled in the past with a reputation for bad customer service, but Comcast believes it has now turned the corner on service.

Technicians are required to leave subscribers a card with the new Comcast Guarantee on it, which gives customers a 30-day money-back guarantee on all services, and offers complimentary services or bill credits if things go wrong.

AT&T's Lewandowski said that despite Comcast's efforts, customers are "hungry for an alternative to cable."

As both companies move toward an ultra-connected future where every home device can be assigned an IP address and be controlled remotely, the real key to success is going to be how successful the integration is, Lewandowski said.

Rather than the technology getting in the way, the next hurdle is going to be content rights, and who can sign the best deals with the biggest networks to offer shows and movies to users, she said.

"Content rights play a major role in making TV content available across devices," Lewandowski said, noting that the service has deals to offer content in almost every format imaginable.

But Comcast, which recently purchased content creator NBC Universal, is still the one to beat, Weigert said.

"We just celebrated 20 billion On Demand downloads," he said.

That's 64 movies for each U.S. citizen.