Cable Leaps Past Telcos?

12:35 PM -- In the telco vs. cable battle, the momentum has just been seized by the MSO. Look at how quickly the competitive landscape has changed in the past day.

Yesterday, Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Time Warner Cable Inc. (NYSE: TWC) offered their customers TV, high-speed Internet, and VOIP services. Their main competitors were AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ), who offered phone, Internet, and new TV services of their own. But because the telcos, especially Verizon, offered significantly higher bandwidth speeds AND could bundle in a wireless offering as well, cable was losing that battle.

Everything is different today. Because Comcast and Time Warner have invested in the new WiMax company formed by Sprint Corp. (NYSE: S) and Clearwire LLC (Nasdaq: CLWR), they have eliminated the disadvantage of having no wireless offering since they are now MVNOs of Sprint. (See Sprint, Clearwire Create $14.5B WiMax Giant.) By themselves, AT&T and Verizon still have the more attractive offerings with faster networks and wireless networks of their own to one day integrate their service offerings into.

But once the WiMax network being built by Sprint and Clearwire starts taking shape, Comcast and Time Warner will have a fifth service in their portfolio to sell to their customers, with that of course being the high-speed WiMax service. AT&T and Verizon do of course have wireless broadband already. But it is on slower networks than what WiMax will be and require the expensive purchase of laptop cards. The new Clearwire service will have WiMax chips embedded into the devices running on it.

AT&T and Verizon will eventually close that gap. (See AT&T & Verizon to Use 700 MHz for 4G .) But Comcast and Time Warner will have a head start in retaining and gaining customers interested in having a high-speed broadband connection from anywhere their lives may take them. The telco vs. cable battle is officially a little more interesting.

— Raymond McConville, Reporter, Light Reading

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