Your New Phone Company Is The Cable Company?

from the so-it-goes... dept

Cable providers in the US took an early lead in the broadband market, though they’ve lost a little ground lately due to cut rate prices for DSL from the telcos. However, the cable providers are looking to pull an ace out of their sleeve by promoting their ability to easily provide the coveted “triple play” of voice, video and data through one single company. Many cable providers have been able to do this for a while, but they haven’t spent much time promoting their phone service. That’s about to change. While the telcos are still struggling to figure out their video strategy (TV over DSL? partner with a satellite provider?), the cable companies are getting ready to heavily promote their VoIP phone plans in conjunction with their TV and broadband connections. They admit that most people still don’t know the cable company offers phone service, but they aim to change that soon. Beyond just getting more money out of each subscriber, it also means much less churn for the cable companies, as studies have shown that the likelihood of a customer switching providers drops drastically for each additional service they receive from their provider. While the article doesn’t mention much about pricing, it would make sense for the cable companies to cut the prices on the phone service drastically. The additional cost to the companies isn’t that high, and undercutting the telcos in their core market has to hurt them. Besides, as the article points out, choosing a phone company is much more of an “emotional” decision than choosing a broadband provider. If the cable companies can win over the emotions of people with very low priced calling plans, they’ll more than make up the difference in new customers for their broadband and video services – and the resulting lack of churn. Update: In related news, Telephony Online points out that it’s about time the telcos stopped just messing around and started more seriously rolling out TV-over-DSL so that they can compete with a true triple play offering themselves.

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