Recent days have seen a flurry of new launches for video services by both AT&T and Verizon. Markets like Jacksonville, Florida, South Bend, Indiana, and Hampton, Virginia are all now able to receive video from the local phone company in addition to cable and DBS options. And it’s not just the large players either. Smaller telcos across the U.S. continue to launch IPTV services. Avail Media, an aggregator of content and IPTV solutions for smaller telcos, announced 20 new affiliates this week. The competitive posturing continues as well, with all kinds of promotions being offered to entice people to switch services. I live in the D.C. area and noticed a commercial from Comcast the other day promoting free DVR for a year – a direct response to Verizon FiOS’ ongoing free multi-room DVR promotion. The ongoing battle lines seem to be intensifying. Should be fun to watch.

DISH Networks has made much noise with HD recently, culminating with their launch of an all HD package, branded TurboHD. Now comes word that they are the “first” pay-TV provider to go all MPEG-4 with standard and high definition programming. “New customers in 21 designated markets in the eastern half of the U.S. who sign up for any DISH Network HD package will be the first in the nation to receive the industry's most advanced delivery system on all televisions connected to DISH Network service,” said DISH in a company statement. The moves come on the heels of a couple dismal quarters for DISH, including 2Q08, where they lost subscribers for the first time in history.

So will these moves be enough? Maybe. You have to give DISH credit. They faced a major setback in HD earlier this year when they lost a satellite shortly after launch. They’ve managed to get past that hurdle. The MPEG-4 announcement makes for a great press release, but I’m not sure how much of an impact it will have on everyday consumers and their choice in pay-TV service. The TurboHD offering has a better chance of moving the needle for them. In addition, they announced new value programming options of $10/month and $20/month, tied to the DTV transition, echoing similar DTV exploitation strategies being pursued by cable competitors. DISH is feeling competitive heat from all angles, including telcoTV providers. It appears as if they are making some real efforts to meet those competitors head on, and reverse the trend of the past two quarters. Will it work?

In the past couple weeks, there’s been a lot of discussion and debate about which telco strategy will win – Verizon’s FTTH play with FiOS, or AT&T’s FTTN strategy with U-verse. Lost in that debate was this country’s third largest telco, Qwest, who also yields significant influence over the telecom landscape. Qwest is following a similar strategy to AT&T, with one major difference. They are not pursuing an IPTV strategy, and are instead (at least for the time being) leveraging a DirecTV partnership for the video portion of their triple play. Qwest CTO Pieter Poll gave an interview to ZDNet’s Between the Lines blog and offered Qwest’s view of the broadband landscape. Here are some interesting takes from the interview:

• For the time being, Qwest is content with a FTTN strategy, utilizing VDSL2 to the home, and delivering a top end speed of 30-35 Mbps
• Poll is not concerned with DOCSIS 3.0, commenting that the 100 Mbps speeds that are associated with it are “a marketing game,” and will not be the reality in the marketplace
• FTTH is simply unrealistic for Qwest because of the cost associated with retro fitting their extensive buried plant assets – a challenge that Verizon does not face with its extensive aerial plant
• Qwest is moving forward with application development and intends to offer their “Q Home” application platform that will among other things, integrate phone service with instant messaging, email, and click-to-call type services

Qwest has taken their fair share of criticism for appearing to be somewhat slower to move into the future than their other “bell” brethren. They’ve punted on IPTV and have no wireless assets of their own, leading to speculation that they will face long term consequences for not being more aggressive with their strategies. But love them or hate them, at least you know where they stand. They’ve decided to follow a different strategy, and are not ashamed to talk about it. All these predictions of winners and losers are somewhat pointless right now. We’re way too early in the broadband game to figure out who wins. Anyone dismissing one strategy over the other is simply speculating. Qwest’s strategy adds some diversity to the mix. They’ll all be worth observing.

The GSM Association, a worldwide trade body made up of GSM wireless carriers, told mobile news that 4G LTE wireless will reach 100 Mbps. They are apparently in a provocative mood too, because not only do they claim 4G LTE will reach 100 Mbps, but will do so before wireline FTTH networks do so commercially. Dan Warren, GSMA director of technology tells mobile news, "Tests show LTE can produce speeds up to 186 Mbps, but obviously you never get the top speed and they vary with distance from the base station and interference.” These comments were placed in the context of European and Asian markets, but if they are indeed more than just boastful claims, competitive implications will surely be felt worldwide. Wireline broadband carriers will have some time to perfect their competitive response. Even by the GSM Association’s eternally optimistic timelines, we likely won’t see these type speeds until 2012 in Europe, and even later in the U.S.

AT&T announced the launch of ConnecTech, a bold move into the home tech support market, and a direct shot across the bow of competing services from Best Buy, Circuit City, and others. ConnecTech will offer “television and home theater installation and personal computer and home network setup, plus an extensive list of repair services.” Home tech support services are growing among the telecom service provider community. Both large and small carriers are seeing the natural evolution of supporting customers in the home with the entertainment and broadband solutions they are increasingly marketing. Rather than just selling a service, these types of support services allow service providers to strengthen customer relationships by helping simplify the growing complexity of installing and managing entertainment and broadband products and services. Of course they also hope to gain some competitive advantage, and make a little money at it too.

It remains to be seen if this is a good business move from a dollars and sense point of view. But I do believe this is a smart move from a competitive positioning point of view. Despite all the cool applications that broadband and entertainment convergence products can do, they can create potential areas of frustration with customers. The average customer has no interest in configuring their wireless router, but they do have an interest in enjoying the experience and convenience a properly configured wireless router can deliver. Service providers that enable that experience and convenience only strengthen their relationship with customers, as well as enhance their brand and visibility. These types of enhancements also strengthen a service provider’s ability to effectively compete. Of course all of these benefits are only won if the tech support service works. By that I mean, technicians show up on time, calls to customer service are answered quickly (and by human beings), and technical problems are resolved to customer’s satisfaction the first time. If expectations are poorly met, these tech support services could backfire and do just the opposite – weaken customer relationships and brand equity. Moral of the story – if you launch these services – make sure they work - the first time. If not, you’re better off without them.

There’s no denying that DSL sales took a beating last quarter. AT&T might be trying to do something about it. They announced a new promotion that locks in DSL pricing for two years without the need for signing a contract. They’re also taking direct aim at cable companies, who’ve been known to promote a term contract or two, albeit less so lately. In a company statement, AT&T says the new pricing promotion offers “a guaranteed monthly rate for two years without the hassle of a term commitment like those of cable companies.” The guaranteed monthly pricing applies to residential AT&T High Speed Internet products, including the company's standalone and AT&T U-verse DSL packages, although some of their lower tier DSL packages don’t qualify.

At first glance, you kind of walk away somewhat unimpressed with this promotion. You can’t knock AT&T for offering promotions of any kind. But if the objective of this campaign is to significantly boost new DSL additions, I’m not sure this will be enough. I’m hoping AT&T is doing some market research to find out exactly why new broadband purchasers have been more likely to choose cable modem over DSL lately (by the way AT&T and others, our sister company, Pivot Group, is happy to oblige if said consumer research services are needed). Maybe some research revealed this issue to be a flashpoint. But it seems to me, more tangible issues also need to be addressed, including better throughput speeds (in both directions) and other value added applications. Giving free access to AT&T’s Wi-Fi network is a great start.

Nielsen Mobile released a revealing study on mobile broadband which may offer some insight into the future of broadband and wireless. The study results reveal that there were 13 million users of 3G mobile data cards in the U.S. as of the end of 2Q08. Mobile data cards connect to laptops and PCs, allowing access to mobile broadband services over a cellular network. The cards come in a variety of formats, including PCMCIA cards, USB cards, and even come embedded in laptops. The study also revealed significant momentum, citing that 55% of these cards were purchased within the last twelve months. One of the more revealing findings indicated that this mobile broadband product is increasingly being used by everyday consumers, not just traveling professionals, or “prosumers” as they are often called. “It’s clear that data cards aren’t just for business travelers but are an increasingly popular choice for in-home, personal Internet access, too” said Nic Covey, director of insights at Nielsen Mobile. “Data cards aren’t just for road warriors—but also for couch and kitchen warriors.” Other interesting findings include:

• 43% of mobile data card users report they most often use their data card at home
• 15% say they typically use the card at work
• 9% say they use the card while commuting to/from work
• 40% of card users also have cable broadband and 34% also have DSL in their home
• 59% of mobile data card users say they might cut their wireline Internet service for data card use exclusively

The threat to wireline broadband service is fairly obvious. There will be a segment of mobile broadband users who will go exclusively wireless, just as they’ve done with voice. The advent of 4G wireless in coming years will certainly accelerate that trend. But I also believe there will still be significant opportunity to leverage both wireline and wireless broadband together. I interpret the findings of this study to also support the notion that broadband carriers who augment their wireline broadband with a wireless value add option can gain competitive advantage. If your value proposition to customers communicates a robust wireline broadband option, complemented by a broadband “lite” wireless option, at an acceptable price point, you may have a winner. Indeed, some leading companies are already executing such a vision. This strategy is exactly what Cablevision has in mind with their pending Wi-Fi mesh network in New York. The idea that I can buy a service that will seamlessly extend my broadband experience, both inside and outside of the home, is quite compelling. As the Nielsen study reveals – compelling to not only prosumers, but soccer moms too.

In a revealing presentation, Cox President Patrick Esser told the Progress and Freedom Foundation's annual tech policy summit in Aspen, Colorado that they intend to capture 20% market share for wireless service. Rather than join the Clearwire alliance like their other cable brethren, Cox is going it alone through its recent acquisition of 700 MHz spectrum. As reported by PC Magazine, Esser says he “…won't divulge too many secrets here, but we'll focus on providing simple calling plans, integrating all our services into one device with a consistent cross-platform interface; and making our content and applications mobile.”

Pretty bold comments considering the hyper-competitive marketplace for wireless. Achieving 20% penetration would be very impressive, especially for a company with no wireless experience. But Cox competitors shouldn’t take them lightly. They’ve been quite successful in capturing significant voice business from their telco competitors, and at one point, they had no experience with voice either. The pending move into wireless by the cable industry will be interesting to watch. They failed miserably with Pivot Wireless. But to their credit, they’re marching forward with a wireless act two. When and if they get it going, it will open up a new front in the bundling war between telco and cable. PC Magazine summed it up nicely with this Esser quote, “Frankly, we're in a street fight today for customers in every single aspect of our business – from the Bells and the satellite guys, to the wireless carriers.” Happy hunting.