Step right in and have your head knocked off. The FCC approved a plan to shorten the time it will take for telephone companies to get licenses to offer subscription based TV. Local authorities will only have a few months to approve applications for TV service.
The FCC feels that by letting telephone companies into a business dominated by cable it will keep consumer rates down. That may be true short term.
The fact is that there is still a big question mark whether consumers want to use the telephone pipe to the home for broadband and TV as well as voice service. Consumers don’t like the current phone broadband, DSL, because it is usually slower than cable. Now they will have to convince potential subscribers that the new fiber intrastructure is better than cable.
What makes the process more difficult for the phone company is that the cable guy has been delivering the TV signal for many, many years and the broadband pipe for the last five or so. And, now they offer VoIP which is usually cheaper that the phone company phone service.
Now, the telephone company can offer all of these services. Maybe the consumer doesn’t what telecoms to do them any favors.
Verizon has about 100,000 subsribers to its new fibet TV operation. It will need to multiply that number by the dozens to pay off the $18 million it is investing in the platform. The cable folks already have their platform. And, they also have the customers already, by the way.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
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