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On Apr 17, 2014 at 21:35:11

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On Mar 17, 2014 at 13:24:06

citycash Posted:
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now have three
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On Jan 05, 2014 at 06:18:47

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Topic:
need Help with Clear Spot 4G internet
On Dec 29, 2013 at 15:17:12

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You can probably
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In The Forum:
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Topic:
Can make calls but can not receive them
On Dec 01, 2013 at 11:29:02

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In The Forum:
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Topic:
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On Dec 01, 2013 at 11:28:29

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In The Forum:
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On Dec 01, 2013 at 11:28:00


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Bells Look For Ways To Adapt


Vonage In Print News



Outside The Lines
As Their Traditional Local-Phone Business Slips Away, The Bells Look For Ways To Adapt


September 13, 2004

By Christopher Rhoads

For the Bells, it's time to adapt or die.

For years, the big regional phone companies had it easy. Regulatory changes in the 1990s ushered in some new competition, but the Bells' traditional local phone business remained largely unthreatened.

Then cellphones and the Internet began chipping away at that core, as customers began ditching their second phone lines. Now, technological changes -- namely, the advent of broadband -- are roiling the landscape as never before.

Better and cheaper technology has created new competitors, such as Internet phone company Vonage HoldingsCorp., and sharpened the teeth of some old ones, like the cable companies.



All of which means even further slackening in demand for local phone lines. So the Bells are diversifying. In the past year, all of them have forged partnerships with satellite-TV companies, like EchoStar Communications Corp.'s Dish Network and DirecTV Group Inc., to offer television service. They've also pushed into long-distance and wireless service, and are planning big upgrades to their networks so they can offer video programming over their own lines, as well as other high-tech offerings developed down the road.

"We are not looking at ourselves as a phone company anymore," says Lea Ann Champion, a senior vice president in charge of operations and services at SBC Communications Inc., the nation's second-largest phone company, based in San Antonio, Texas. "A radical transformation is going on across the industry that has only just begun."

Hitting Redial

Much of this talk is nothing new. In the early 1990s, the phone companies promised to roll out new networks capable of providing huge amounts of bandwidth that could deliver video and other services. Pacific Bell, which was later acquired by SBC, declared in its 1993 annual report that it would deliver broadband to more than 1.5 million homes by the end of 1996, an unmet goal.

Bell Atlantic, which later merged with Nynex to become Verizon Communications Inc., tried to build a video-on-demand service at the time, called Stargazer. But technology limitations and low projected revenue from subscribers helped scuttle the plan. Other false starts included a project called Tele-TV, a joint effort among several regional phone companies to deliver cable services.
Several of the Bells even forged an earlier round of alliances with satellite-TV companies, such as SBC joining with EchoStar, only to have the arrangements come apart due to lack of synergy and poor organization.

"The Bells made all these promises, and not one of them was met," says Bruce Kushnick, the head of Teletruth, a telecommunications consumer-advocacy group based in New York. In terms of the missed opportunities to develop new applications, "this was a lost generation of technology."

Meanwhile, cable companies spent the 1990s investing in their infrastructure to the tune of more than $60 billion. This big spending gave them the lead over phone companies in providing high-speed Internet service to homes. Cable companies also began offering phone service over their cable lines, using traditional -- and expensive -- circuit-switch technology.

But with the emergence of much cheaper Internet phoning, called voice over Internet protocol, or VOIP, the cable companies now have their sights set on gulping down a huge share of the Bells' local business. The result of all the incursions into the Bells' turf: Revenue from fixed-line phones, the lifeblood of the Bells, is expected to fall to $23.3 billion by 2007, a 20% decline from 2002, according to Yankee Group, a Boston-based research firm.

So, the Bells are forced to try their old plans again -- and some new ones besides. Last year, SBC renewed its ties with EchoStar, striking a partnership to sell EchoStar's satellite services, and the other Bells -- Verizon, BellSouth Corp. and Qwest Communications International Inc. -- have made satellite deals of their own. Some Bells have also announced plans to deploy VOIP, even though it will hurt their core business.

The Bells have also pushed into the long-distance market in search of revenue -- with considerable success. By selling bundles of local and long-distance services, Verizon now has the nation's second-largest long-distance business, as measured by customers, and SBC is No. 3. The Bells secured permission from state regulators to offer long distance in all states only last year, contingent upon allowing for more competition in their local-phone business.

Moreover, even though wireless eats into their traditional fixed-line business, the Bells have pushed hard to develop what many experts predict is the future of phoning. SBC and BellSouth, for example, are beefing up their joint wireless business, Cingular Wireless, by acquiring AT&T Wireless.
Perhaps the biggest plan of all is deploying fiber-optic cable -- the conduit for new services, such as video and broadband Internet. Though the deployment costs are huge, most of the regional phone companies have embarked on efforts to bring more fiber to their networks, either to neighborhood hubs or directly to homes.

Such upgrades are expected to take several years to implement, but Verizon has said it intends to offer limited video service in some of its markets by early next year. The New York-based Bell has announced the most aggressive plans for revamping its network, vowing to bring fiber -- which can deliver perhaps more than 100 times the bandwidth of existing broadband Internet services -- directly to three million homes by the end of next year, costing close to $2.5 billion.

More than half of SBC's customers have some sort of bundled service from the company. And between 70% and 80% of its customers have said they would buy a television package from SBC, says Ms. Champion. "There is a growing demand to get higher bandwidth and new applications -- and to get that from a single provider," she says.

Where does all this lead?

"The endgame is that all of us, cable and phone companies, will be in the same business 36 months from now," says Balan Nair, chief technology officer of Qwest, the local phone company for 14 states that is based in Denver. "Then the question will become, do we have too many providers and too few customers?"

Target Markets

Faced with that likelihood, both sides have launched advertising and promotional blitzes aimed at each other's customers.

Shannan Tolle, a 46-year-old city-government worker in Phoenix, says he canceled his cable-television subscription with Cox Communications Inc. around five years ago and opted for Qwest's television offer instead. He says he prefers having his high-speed Internet connection with Qwest, since its digital subscriber line is not affected by higher usage from others in the neighborhood, unlike the case with a cable modem.

But in recent months, Cox has stepped up efforts to get him back. "Cox mails me something or hangs something on my door at least once a week," says Mr. Tolle. "They're really aggressive." He adds he has no plans to switch back to Cox.
For years, Elaine Megna, a 52-year-old dentist in Buffalo, N.Y., received her television service from a cable company, Adelphia Communications Inc. Then, in July, Ms. Megna dumped Adelphia in favor of satellite television, with DirecTV.

What made her do that? Her phone company.

Verizon's relentless advertising for the joint television and phone service from the two companies -- as well as Ms. Megna's favorable impression of DirecTV from her daughter, already a subscriber of the bundled deal -- prompted her to give it a try.

In addition to the favorable price, she likes some of the satellite-TV features, such as pausing and rewinding programming. That allows her to make sure she doesn't miss any key ingredients when watching her favorite cooking shows, such as "Emeril Live."

"As long as it's good service and they can deliver the product, I don't care who it is," says Ms. Megna.



 
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