Speaking of cable, keep an eye on HSAC as well:
High Speed Access Helped by AOL-Time Warner: Bloomberg Forum
New York, Jan. 14 (Bloomberg) -- High Speed Access Corp., looking to sign up customers for fast Internet service through cable lines, will benefit from a combined America Online Inc. and Time Warner Inc., High Speed Access President Dan O'Brien said.
That's because America Online's proposed $163 billion purchase of Time Warner will boost demand for High Speed Access's phone and Internet service, O'Brien predicted. America Online and Time Warner have said that, if the biggest-ever merger goes through, they won't block other companies from Time Warner's cable lines, used by 13 million homes.
America Online and Time Warner, which has a stake in High Speed Access rival Road Runner, don't serve most of the 48 million rural and suburban U.S. homes that are High Speed Access' focus, O'Brien said. Companies such as High Speed will be vital to America Online-Time Warner's plan to attract customers with packages that combine phone, voice and cable, he said. "We see this as a great opportunity to go to Time Warner cable systems,' O'Brien, who is also High Speed Access's chief operating officer, told the Bloomberg Forum while in New York. "And we think this is just the beginning.'
Analysts expect Denver-based High Speed Access, whose largest shareholder is Microsoft Corp. co-founder Paul Allen, to have about 140,000 cable customers at the end of the year, 15 times more than the 9,300 it had as of Sept. 30. Allen, the second-richest man in the U.S., envisions a so-called wired world, in which everyone can surf the Web from home and work.
Calling Through Cable
O'Brien declined to comment on the company's earnings expectations or how many customers it expects to have. High Speed Access had $1.1 million in third-quarter revenue, and sells Web service for $40 a month, about what Road Runner charges.
High Speed Access shares trade around 18, having risen about 38 percent since their initial public offering price of 13 in June. However, it has steadily declined from an all-time high of 49 3/16 on July 12.
High Speed Access is testing equipment from Cisco Systems Inc. and Lucent Technologies Inc. that lets customers in Georgia make phone calls over cable lines. The company expects to introduce the service widely in the third quarter, O'Brien said.
The company also is selling high-speed Web access over regular phone lines where there isn't cable, O'Brien said. It wants to further expand by selling fast Web service outside the U.S., he said. He declined to say where.
Bridging a Divide
``Our strategy is to bridge the digital divide . . . to bring that access to consumers wherever they live,' said O'Brien, ``What we are doing internationally is looking at joint ventures where we can take the expertise that we've developed domestically.'
Although some analysts speculate that smaller cable companies such as High Speed Access might be bought by larger cable operators or Internet service providers, O'Brien said he expects to remain independent. He was previously president of Primestar Inc., the satellite operator bought by Hughes Electronics Corp.
High Speed Access is part of a joint venture that includes Charter Communications Inc., the No. 4 U.S. cable operator; RCN Corp., which sells Internet, phone and cable service; and Go2Net Inc., which runs a network of Web sites. They're all backed by Allen's billions of dollars. ``One of the things that's great about our economy, particularly the Internet economy, is that lots of small companies can thrive,' O'Brien said.
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