ON CABLE-TELCO "TURF WARS"

NO CIGAR

The New York Times has an article noting the ongoing "turf wars" between the cable and telco industries, in the race to provide more broadband services to mainstream customers. 

There are great anecdotal examples of the daily battles fought between the two camps as installers leave competitors' facilities in a shoddy condition.  An example:

"Qwest says the (bee hive) infested box is just one of many pieces of equipment that Cox has damaged or misused. It says Cox has left wires exposed and improperly grounded cables, hazards that could disrupt phone service or hurt customers and workers. Qwest even argues that the damage is part of a plan to make it harder to sign up customers it lost to Cox.

Technicians who came to Qwest from Cox said “that their instructions were to make it as tough for Qwest to win back the customer as possible,” Mr. Pappas said."

The piece goes on to highlight similar incidents between other phone and cable companies and tries to make the following point:

"...the contest is a two-way slugfest between powerful and sophisticated companies with deep pockets and a lot more to lose. The start-ups that were born in the wake of regulatory changes have largely faded as a threat, particularly in the last year, as Bell companies bought their two biggest rivals, AT&T and MCI."

The piece also highlights the efforts the camps are going to in order to attract mainstream public support:

"Qwest is also taking its case to the news media. Mr. Pappas spent two hours last month driving around Phoenix to show a reporter the damage to Qwest’s property. The telephone boxes he visited had a few exposed wires, small unsealed holes and what Mr. Pappas said was improper grounding of Cox electrical wires to Qwest equipment."

It ends with this quote from a representative at Qwest:

“If this is not competition, then I don’t know what it is,” said Scott Simanson, vice president and general manager for Qwest’s operation in Arizona."

The subliminal message being attempted to convey is that consumers should be thankful for the competition we have today in broadband services.

I'm sorry, with the US being ranked 16th or worse globally in the provision of broadband services to mainstream customers, this strikes me as a bit hollow.  We have a long way to go for true competition, as I've noted often before.

As rancorous the daily competition between these two regulated, protected, and politically coddled camps may be, it does not take the place for true market-based competition.

And that goes for the wireless broadband "competitive" landscape as well.

Comments

[Yaser Anwar]

Cable is girding for a regulatory and marketing battle against phone companies that are better equipped to offer IP Television over their fixed-line DSL services.

Its not surprising that a vast majority of telco executives believe the Internet-savvy youth market would be a major driver in telecom services.

MP check this link out pertaining to C vs T for the enterprise market, interesting stuff

http://img.lightreading.com/heavyreading/pdf/hr20060215_esum.pdf

[Ward]

It is not competition when a football game turns into a brawl or when the outcome turns on a penalty. Anyone who thinks this crap is competition doesn't understand the meaning of the term. Indeed, if the markets were more truly competitive it would be harder for one scroflaw to damage equipment or break rules of other sorts because he'd have more competitors watching him. The sad thing is that Kevin Martin et al. know this but they fear the consequences too much.