Verizon’s FiOS a Growing Threat to Cable; AT&T Goes to Washington?
By Joseph Weisenthal - Wed 24 Oct 2007 08:12 AM PST
Once dismissed, Verizon (NYSE: VZ) is forcing people to take its TV initiatives seriously. The company announced yesterday that its IPTV service FiOS TV had signed up 500,000 subscribers (release), and as the WSJ reports, it’s causing increasing consternation in the cable industry. You can see it in Comcast’s stock price, which has been steadily declining ever since executives acknowledged that telco operators are taking away customers. Expect management to be grilled on this when Comcast (NSDQ: CMCSA) reports earnings tomorrow. Fears of FiOS may also provide a much-needed lift for the Dolan family in their bid to take Cablevision (NYSE: CVC) private, as the future looks increasingly competitive. One analyst pegs FiOS subscribers at 2 million by the end 2008, making it the 9th largest TV operator in the country.
Lagging a bit behind Verizon is AT&T, which yesterday said it had 126,000 U-Verse customers, a number growing at 10,000 per week. Although management denies it, there’s been a lot of talk about U-Verse proving to be a disappointment and the company making a play for a satellite operator. Separately, the WSJ, citing “people familiar with the matter”, is reporting that AT&T (NYSE: T) has been in talks with Washington, DC lawyers about how long it would take for a satellite acquisition to clear regulatory hurdles. The thinking is that it wants to be sure the deal is complete before a new administration (read: Democratic President less friendly towards big media M&A) is in place. Note that similar rumors have been flying back and forth ever since the original AT&T/Echostar (NSDQ: DISH) combo was discussed last month, with little to show for it.
Posted in: Companies, AT&T, Comcast, Verizon, Media, TV, Cable & Telecom, IPTV, VC+M&A
