Comcast offers $99 package for phone, cable TV, Internet
August 27th, 2006 - Posted in Other, WirelessComcast Corp. is a cable TV and high-speed Internet company, and now it wants to be the phone company, too.
The Philadelphia-based cable giant has rolled out Internet-based phone service in Nashville and is trying to add it in several surrounding counties within the next 90 days, hoping to sell customers a $99 a month package that includes Internet-based phone, high-speed Internet and digital cable TV services.
The offer, which Comcast is promoting in about 20 cities, is another sign of the blurred lines in telecommunications as a growing number of phone companies sell Internet services, and cable TV companies fire back with new phone products.
Independent companies such as Vonage and SunRocket that advertise nationally have dominated Nashville’s Internet phone market, but Comcast could be formidable competition because of its marketing muscle and broad customer base.
Voice Over Internet Protocol, or VoIP, has the advantage, proponents say, of often being cheaper than traditional phone service. It can carry other perks, too, such as the ability to check voice messages from a Web site.
Comcast won’t say how many people have signed up for its VoIP service in Nashville, but Vice President and General Manager John Gauder said the company plans to add about 100 salespeople in Middle Tennessee this year to meet demand.
Telecommunications researchers say cable companies had captured 60 percent of the domestic Internet phone market by midyear.
Comcast got a late start offering Internet phone service compared to other cable companies, including Time Warner and Cablevision, which trail only Vonage nationally in terms of VoIP customers.
But subscribers joining Comcast’s service climbed 73 percent between the first and second quarters this year, according to VoIP research firm TeleGeography Research.
Comcast says it has about 1 million customers for its “digital voice” offering in more than 20 markets and expects to reach 1.3 million to 1.4 million by the end of the year.
The overall VoIP market has about 6.9 million subscribers, a 153 percent increase from a year ago, according to TeleGeography.
Prices for VoIP services vary greatly, with Comcast and other cable companies typically charging more.
SunRocket sells Internet phone service for as little as $9.95 a month. Vonage sells the service for $19.99 a month for a six-month introductory period and then it goes to $24.99 a month.
Comcast’s lowest rate for digital voice amounts to $33 per month, but it is only for sale as part of a broader package deal in which a customer gets broadband Internet service and digital cable for a total price of $99 a month.
Gauder said half of new customers in the Nashville area are getting the package deal.
If someone doesn’t buy the package deal, Internet phone service will cost either $44.95 a month or $54.95, depending on whether a customer has at least one other Comcast service.
The cable company justifies its higher prices with a dedicated IP network. Phone calls never enter the general worldwide Web, so phone conversations are presumably clearer, Comcast says.
Another difference is that Comcast phone customers don’t need a broadband Internet connection; the Comcast cable that runs into the house is the broadband.
Vonage customers must self-install the phone adapter. Comcast, on the other hand, sends a technician to do the set-up.
TeleGeography analyst Stephan Beckert said VoIP companies like Comcast are helping to grow demand by overcoming problems with service quality and some customers’ concerns about whether VoIP works with 911 calls. Comcast’s Internet phone service handles 911 calls in the same way a traditional phone line would, according to a company press release.
Still, if the cable or broadband connection goes down, that means the phone and the 911 services are out, too.
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