"I wonder if anyone can verify that, according to AOL's plan, the set-top box will help with both dial-up and DSL services. "
From the News release
"AOL TV will give its members the ability to connect to a new AOL
interactive service designed to enhance the television-viewing
experience. The set-top boxes will be connected to AOL through built-in 56K modems over standard phone lines, and will be enabled for digital subscriber line (DSL) connectivity as well."
Many people seem to think that Broadband access is an either/or scenario.. This is not the case, Currently Cable is the front runner, but DSL is poised to catch up, due to Cables relatively slow roll out. Satellite is still far behind. This can change in five years if the phone companies realize the opportunity they have with DSL or if Satellite tech and the low orbit satellites work out.
The problem with the broadband issue is that it is not a clear case of one technology or company leading the other. From the Mercury News
sjmercury.com
"David C. Nagel, a former top Apple executive and now AT&T's chief
technologist, and Frank Ianna, AT&T's president of network services, visited the Mercury News recently to talk about these transitions"
[Text Deleted ]
Q Will you eventually charge people by the amount of information they send and receive?
A NAGEL: I don't think so. I think the inevitable is charging by the
connection. If you want a phone, it's $5.95 a month. Use it as much as you want. Because the marginal cost is approaching zero -- per minute, per packet, per whatever.
[Text Deleted]
"Q Phone, cable and Internet companies today don't seem to offer
consumers what they really want, which is something that's convenient and understandable. Isn't this a substantial problem?
A NAGEL: What you're seeing is an industry that's trying to figure out how to differentiate itself with a basically undifferentiable product. Everybody's long distance is pretty much the same. So you slice and dice, you give people airline miles.
I think the thing that's going to happen now, we did introduce Digital One Rate (a wireless phone plan that charges the same for local and long distance calls) and customers did like it. As soon as we can move our economics to do that kind of thing, you're going to see a lot of Digital One Rate plans that are really simple. You've got your cellular phone, you've got your data networks, you've got this, you've got that, you've got TV, $99 a month, all you can eat. Everyone can understand that.
The other thing is, we're trying to move to differentiation. One of the reasons we're buying cell phone companies and cable TV companies is so we can provide every conceivable communication service someone wants. You can have your e-mail, you can have your voice mail, you can have those things integrated, you can have them displayed on your TV, you can have them read to you over your phone."
MY THOUGHTS
If you can have your Digital TV Cable, Your BB Internet, Your digital PCS, your voice mail, and email all for one price of say $99 a month, and get LONG DISTANCE PHONE CALLS FOR FREE why would you need or even thing about a DSL line with your local phone co, long distance with Sprint, ISP service with AOL, TV service from Satellite, Paging service from AT&T.
Now the question is, will AT&T be allowed to offer service packages like this? Is that anti-competitive? Just because it costs AT&T virtually nothing to offer long distance service over cable, does that mean they can charge nothing if you buy another of their services?
There is NO CLEAR WINNER in ISP and BB. The factors are far too complex and have far too many variables. As an investor the best you can do is pick companies with sound business plans and strong management. Companies who understand these complex issues.
Personally, I own T, AOL, and ATHM. T understands these issues and has cable, phone, DSL, wireless, set top box, and possibly with Satellite (if they can get in with Bill Gate's low orbiting satellites), ATHM is benefiting from T's interests. AOL is doing it's best to get into broadband, but but is ignoring the front runner, cable. My only wish with AOL is that they do what they can to ride the cable pipes.
5 years from now, when we are both getting into our jets (bought with AOL proceeds) we can talk about who the clear winner was/is...
regards
Jay |
