Rico,
Since ATHM gets 66% of their customers from AOL, what happens when AOL does a broadband deal with T? Does 66% of ATHM's new business vanish overnight? Why would anyone want ATHM when they can have AOL content and broadband speed? Or do you think that T will be able to fend off those that want open broadband access, and continue to force users to go through ATHM? In other words, as it stands now broadband=ATHM. How much longer will this equation be true?
AOL's strategy is to provide broadband service over telephone lines, cable, wireless, and satellite. AOL will compete with the native ISP's in each of these pipes, but will be one of the few ISP's that offers one-stop service accross ALL avenues to the net. As the pieces continue to fall into place IMO investors will begin to realize that AOL is the broadband play not ATHM.
A couple of questions for someone with ATHM service:
1. I've got 4 wired phones, 1 portable phone, 2 PC's, and 3 TV's (currently on cable). If I wanted to get all my services through cable, how many cable boxes would I need to have installed?
2. Would I have to run cable to every phone and PC?
3. I have a house in FL and when I go there I can log onto AOL at the access # down there with no additional charge. Can I do this with ATHM?
4. What happens if they don't sign up enough customers to cover the costs of the broadband upgrade? Just because a house is passed doesn't mean they have a PC, and if they do have a PC are they going to pay double for broadband? Since you've now switched everything over to T and it will be a big pain in the @ss to switch back, will your cable co. simply increase your rate until their costs are covered?
What happens when all the hype dies down re: T/ATHM/UMG/TCI etc. and the analysts start looking at increasing competition/decreasing margins in T's core long distance business, and start questioning the details of exactly how long it will take for T's multibillion $ cable bet to pay off. I remember T went down after it bought TCI because the $ and time est. for upgrading to 2 way kept going higher the deeper they looked. Has the TCI situation changed or did everyone just forget about it?
Regards,Lee |
