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Cable Sharpens Its VOIP Edge

Is VOIP the new black for cable operators? Sure looks that way. Just about everywhere you look right now, cable operators are rolling out and promoting IP phone service as THE hot digital product of our times. And for good reason. As the premiere edition of Light Reading's Cable Industry Insider spells out, the cable guys have enjoyed phenomenal growth with VOIP over the past two and a half years. In 2005 alone, North American cable operators signed up approximately 2.2 million IP phone customers, climbing from 500,000 subscribers at the end of 2004 to slightly more than 2.7 million. U.S. and Canadian MSOs have gotten off to an even stronger start this year, adding slightly more than 900,000 VOIP subscribers in the first quarter to conclude March with more than 3.6 million IP phone customers. Entitled Cable VOIP: Prospects for Sustainable Growth, the Cable Industry Insider report analyzes how cable operators are building their IP telephony business by packaging it as digital phone service, attracting new subscribers and luring customers away from the Baby Bells. The research report profiles 11 top MSOs, comparing and contrasting their current and projected efforts in the VOIP market. It also shows how MSOs are increasingly using their fledgling digital voice products to drive "triple-play" sales and boost video and high-speed data subscriptions. Peering into the future, the report predicts that cable VOIP growth will keep accelerating throughout the rest of 2006 and 2007. It projects that North American cable operators will add nearly 4 million IP subscribers this year to hit at least 6.5 million customers. It then sees U.S. and Canadian MSOs netting another 5 million VOIP subscribers next year to reach 11.5 million customers. But, as the report spells out, some stiff competitive challenges remain for cable VOIP providers. For one thing, MSOs face direct competition from such standalone VOIP providers as Vonage, 8x8 Inc., SunRocket, BroadVoice, Primus and, now, EarthLink. Plus, after getting off to a late start, the RBOCs are finally showing signs of regrouping against the VOIP charge. In addition, cable operators face challenges from such fast-growing Internet phone companies as eBay's Skype Technologies, which offers free computer-to-computer calls. Want to find out more? We thought you might. The report, Cable VOIP: Prospects for Sustainable Growth, is available as part of an annual subscription (6 monthly issues) to Light Reading's Cable Industry Insider, priced at $1,295. Individual reports are available for $900. Check out www.lightreading.com/cable/ for more info. -- Alan Breznick, Site Editor, Cable Digital News
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