Comcast has begun rolling out Internet-enabled telephone service to customers in Western Washington with service in Seattle scheduled for...
Comcast has begun rolling out Internet-enabled telephone service to customers in Western Washington with service in Seattle scheduled for launch by November.
The service, called Comcast Digital Voice, is part of a nationwide push by the country’s largest cable provider, and one that ratchets up the battle between cable and telecommunications providers to win customers across a spectrum of technologies.
Comcast offers the service in 10 markets so far and plans to expand into 10 more by the end of the year, potentially reaching 15 million homes. By the end of next year, the company is aiming to reach all markets — about 40 million homes.
The company has tiered its pricing for the service, charging $40 a month for customers who already pay for cable and high-speed Internet services. Customers who subscribe to one of those services will pay $45 a month, and those who want only Digital Voice will pay $55 a month.
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The service includes unlimited local and domestic long-distance calling, Web access to voice mail and the ability to make 911 emergency calls. By year’s end, customers will be able to go online to view the numbers they called, check their bill or forward calls directly to voice mail.
“Our strategy has always been to provide communications to our consumers the way that they want to communicate,” said Cathy Avgiris, a senior vice president at Comcast and general manager of the company’s digital voice services.
“If we can entertain them, provide them information and meet their communications needs, then we feel that’s a good position for us to be in.”
Internal studies at the company show that about 75 percent of its Digital Voice customers also pay for video and high-speed Internet services, Avgiris said.
Comcast has 21.4 million cable and 7.7 million high-speed Internet customers. In Washington, it has 1.1 million cable customers and at least 400,000 high-speed Internet subscribers.
Analyst firm IDC estimates that the number of residential subscribers to the Internet phone service — also called Voice over Internet Protocol (VoIP) — will grow from 3 million in the U.S. in 2005 to 27 million by the end of 2009.
The Digital Voice service is available in Vancouver, Bremerton and along the Interstate 5 corridor. It won’t widely launch in Seattle until November.
Analysts said yesterday that the service is priced at the high end of the VoIP business. Market-leader Vonage, for example, charges $25 a month for local and long-distance calling.
Comcast, however, is positioning its service as more reliable than its competitors — so much so that it can replace land-line services.
The company said technicians will install the service and convert phone jacks and existing wiring. Customers will be able to keep their phone numbers.
The setup will have battery-powered backup, so the service can run for five to eight hours if a home loses power, Comcast said. Calls travel over Comcast’s own network and not the public Internet.
“Comcast has the potential to take back some parts of that market because it is doing things that Vonage can’t,” said Brian Washburn, an analyst at Current Analysis, a research firm in Sterling, Va.
The company has lost customers because it has been slow in rolling out Internet-based phone services, he said. Other services, such as AT&T CallVantage and Qwest’s OneFlex, have been aggressive in entering the market.
Most customers don’t need an unlimited calling package, Washburn said, and Comcast could offer a per-minute type of fee structure.
“What these folks really need to do is bring in a metered service at a lower price point if they want to capture all the people that don’t live on their wired telephones.”
Cable companies are embracing VoIP because it generates significant revenue and uses little network capacity, said John Barrett, research director at Dallas-based Parks Associates. They are becoming multiservice providers that offer television, voice, Internet and ultimately, some kind of mobile phone service, Barrett added.
“If you can only offer some of the pieces of that, it puts you at a huge disadvantage against your competitors.”
Kim Peterson: 206-464-2360 or firstname.lastname@example.org