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Hail New VOIP King?

Fuhgeddabout Vonage or Time Warner keeping the VOIP crown much longer

Alan Breznick

January 8, 2007

2 Min Read
Hail New VOIP King?

6:00 AM -- Forget about Vonage Holdings Corp. (NYSE: VG) or Time Warner Cable Inc. (NYSE: TWC)keeping the VOIP crown much longer. If its current hot pace of growth continues, Comcast Corp. (Nasdaq: CMCSA, CMCSK) will soon replace those two companies as the nation's largest provider of VOIP service.

Despite its late start in the IP phone business, Comcast has been covering vast amounts of ground in the past year, swiftly closing the gap with cable leader Time Warner and overall market champion Vonage. In the first three quarters of 2006 alone, the nation's largest MSO added more than 1 million new VOIP subscribers, boosting its total to nearly 1.35 million.

With analysts reckoning that Comcast picked up at least 500,000 more IP phone customers in the fourth quarter, the MSO may even have passed Time Warner already. Time Warner, which got off to a two-year headstart in the business, has seen its growth slow significantly since last spring, leaving it within shooting range of Comcast. After closing the third quarter with 1.65 million VOIP subscribers, it probably closed the year with 1.8 million to 1.9 million customers.

As for Vonage, which closed the third quarter with slightly more than 2 million VOIP lines in service, its overall market lead is probably safe for another quarter. But, with Comcast now picking up more than twice as many voice customers each quarter as Vonage, the latter's lead will probably wither away by sometime in the spring.

Ironically, the big wildcard in this equation is the now-defunct Adelphia Communications . Adelphia, whose cable systems were carved up by Comcast and Time Warner in August, never offered VOIP service to any of its customers. So Time Warner and Comcast are now both scrambling to upgrade their old Adelphia systems for IP phone operations and launch phone service as quickly as possible.

— Alan Breznick, Site Editor, Cable Digital News

About the Author(s)

Alan Breznick

Cable/Video Practice Leader, Light Reading

Alan Breznick is a business editor and research analyst who has tracked the cable, broadband and video markets like an over-bred bloodhound for more than 20 years.

As a senior analyst at Light Reading's research arm, Heavy Reading, for six years, Alan authored numerous reports, columns, white papers and case studies, moderated dozens of webinars, and organized and hosted more than 15 -- count 'em --regional conferences on cable, broadband and IPTV technology topics. And all this while maintaining a summer job as an ostrich wrangler.

Before that, he was the founding editor of Light Reading Cable, transforming a monthly newsletter into a daily website. Prior to joining Light Reading, Alan was a broadband analyst for Kinetic Strategies and a contributing analyst for One Touch Intelligence.

He is based in the Toronto area, though is New York born and bred. Just ask, and he will take you on a power-walking tour of Manhattan, pointing out the tourist hotspots and the places that make up his personal timeline: The bench where he smoked his first pipe; the alley where he won his first fist fight. That kind of thing.

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