It is definitely "put-up or shut -up" time for IPTV and its video service competitors. (See Will IPTV Bloom in 2006?)

Within hours of each other on Thursday, AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ) both announced further progress in their efforts to bring TV and all manner of digital services to consumers via their revamped, fiber-fed access networks.

AT&T announced it has started a controlled market entry for its IPTV service in San Antonio, where it has been conducting network trials for several months. There are a small number of customers being targeted for the service now, and that number will grow to "several hundred in the next few months," according to AT&T spokeswoman Denise Koenig. (See SBC Stretches Lightspeed Timeline .)

The carrier's first IPTV customers will have their homes outfitted with a 2Wire Inc. residential gateway and up to three DVR-equipped set-top boxes. AT&T will use Motorola Inc. (NYSE: MOT) and Scientific-Atlanta Inc. set-tops later on. It is using Tatung products right now.

As the service ramps, Koenig says, customers will get several dozen more channels and the ability to enjoy "whole-house DVR" -- a service where a program recorded by one TV is watchable on any other TV in the house.

Interestingly, AT&T still hasn't settled on a single compression scheme to get all its video bits down the last few feet of copper pair to the customer's house. This initial market entry in San Antonio uses "either MPEG-4 or VC-1," according to Koenig. VC-1 is Microsoft's Windows Media 9 Series codec for creating high-quality video at lower data rates.

Because of this and other technical issues, the carrier is starting slow and will roll out to more and more homes as it fine-tunes the service. In a public demonstration back in November 2005, some of the advanced features AT&T attempted to show off to Texas Governor Rick Perry and others didn't work so well. Specifically, the demonstrator had trouble remotely program a DVR with a wireless phone, and the switch between live TV and a video-on-demand library was less than elegant. (See SBC Makes $800M Texas Pledge .)

Not to be outdone, Verizon also trumpeted its video services success today as the carrier boasted that it will make FiOS TV available to 1 million potential viewers in the Dallas-Fort Worth area by the end of 2006. (See Verizon Extends FiOS.)

The carrier says it is now offering FiOS TV to 14 communities in DFW, up from seven just a few weeks ago. As of the end of 2005, Verizon says its fiber access network passed 3 million homes, and the company plans to pass 3 million more by the end of 2006. That would cover around 20 percent of its residential customer base.

— Phil Harvey, News Editor, Light Reading