It's quiet tonight.
Here's the Financial Times take on the AOL-SBC announcement.
<<<
Americas March 12 1999
TELECOMS: AOL and SBC agree link-up
By Richard Waters in New York
The attempt to marry online content with the latest communications technology triggered another big corporate alliance yesterday as America Online and SBC Communications announced plans to sell high-speed information services to American homes.
The agreement mirrors one reached two months ago between AOL and another large local telecommunications carrier, Bell Atlantic, and could eventually give the leading online content company faster access to a large number of homes in the US.
But the fact that high-speed lines will only be available to relatively few of the potential users for some time to come is likely to act as a drag on such development.
The partnerships are the latest sign of the scramble under way by telephone and cable television companies to create a new generation of interactive services that combine the internet's breadth of content with the latest high-speed communications technology.
AT&T's plan to invest heavily in the cable networks of Tele-Communications Inc, which it acquired earlier this week, has set it on a collision course with local telecoms companies in the race to make such services a reality.
By offering AOL's service, the local Baby Bell telephone companies should see far more demand for their high-speed telephone lines, said Blaik Kirby, a principal at Renaissance Worldwide, a consulting firm based in Boston. "They didn't have the content to drive the service before," he added.
Using digital subscriber line (DSL) technology, which pumps higher volumes of information down existing copper telephone lines, the local carriers have so far only inched their way into providing high-speed access.
Deals such as those with AOL, however, will create far more demand for the service, according to Peter Castleton, head of high-speed consumer products at Bell Atlantic. "We've all committed to large deployments of DSL - it will come into its own this year," he added.
SBC said it expected to make broadband services available to 8.5m homes by the end of this year, or nearly half the total in its region, while Bell Atlantic predicted it would reach 7.5m, or around a third.
AOL has yet to reach agreement on delivering its service over cable television lines, which could provide an even faster link to consumers.
Along with other internet service providers, it has been lobbying hard to have the cable networks opened up to all online services on the same basis, rather than allowing them to give preferential access to their own high-speed information services.
Eventually, SBC and Bell Atlantic could give AOL a high-speed platform to reach a large number of its existing 15m customers in the US.
SBC and Bell Atlantic are still waiting for regulatory approval for their mergers with Ameritech and GTE, deals that would leave the two companies accounting for around two-thirds of all local telephone lines that reach the "last mile" into customers' homes.
>>>>>> |
