Michael's Insight

FCC report indicates over half of Americans ages 25-29 do not have landline phone

Half of American Adults Under 30 Don't Even Bother With Landline Phones [Gizmodo]

This week, the FCC released its 15th annual wireless communication report. The commission's report contains a number of metrics about the mobile voice and data industry, including mobile penetration across various age groups.

The report shows that just over 51 percent of adults from 25 to 29 only use mobile phones in their households. This marks the first time that wireless-only households have exceeded landline households for any age group by the FCC's count.

In the age groups immediately younger and older than this demographic (the 18-24 year-olds and 30-34 year-olds) roughly 40 percent lived in wireless-only households.

Across the U.S., of the 308 million people living in this country, at the end of 2009 274 million used a mobile phone. Of those, over 55 million had some type of mobile data plan for that phone.

Pew study finds increase in VoIP usage

Pew: A Quarter Of American Internet Users Have Placed Phone Calls Online [TechCrunch]

Pew Internet has released a new study focused on the growth of voice over Internet protocol or VoIP services.

The Pew study found particularly impressive growth numbers for VoIP, indicating that roughly one quarter of all American adults who use the Internet (and about 19 percent overall) have placed a phone call online. Each day, 5% of Internet users in the U.S. make VoIP calls.

When considering the VoIP usage numbers for past years, these percentages are even more impressive. Pew's research had never shown more than 10 percent of users who had placed VoIP calls. In 2007, for instance, only eight percent of users had made VoIP calls, with two percent making calls on any given day.

By age group, Pew's research showed that the highest percentage (27 percent) of VoIP users, not surprisingly came from the 18 to 29 age group. On a household income level, 37 percent of households with income exceeding $70,000 had made a phone call using VoIP.

Study indicates cable industry growing and creating more jobs

Study: Cable represents 1.8M jobs – and growing [CED Magazine]

The Bortz Media and Sports Group conducted a new study on the economic impact of the cable industry and they’re sharing some very interesting results. The report, recently released by the NCTA, shows that the cable industry in the United States (including operators, programmers and suppliers) represents economic output of well over $250 billion and supports, both directly and indirectly, roughly 1.8 million jobs.

Despite the economic recession of the past few years, the cable industry is one of the very few to continue to have had steady job creation and growth.

Across the country, cable operators directly employ 233,700 people with a combined personal income of $17.3 billion. These figures are bolstered by the 136,000 individuals that work indirectly for cable providers, such as contractors or consultants. These employees bring in additional personal income of $11.1 billion.

In Kentucky, where we serve over 60% of all cable customers, 20,000 jobs are directly and indirectly attributed to cable operators and their suppliers.  Indiana has 27,000 cable-realted jobs and Ohio has 63,000.

Over the past eight years, the industry has created 638,000 direct and indirect jobs.

Further, the cable industry has made huge investments in infrastructure and local community development.  Over the past 15 years or so, over $170 billion has been invested by cable operators in developing broadband and cable infrastructure. The study concluded by stating that “through these investment and innovation initiatives, the industry has exerted a substantial impact on the United States economy.”

 

FCC releases report showing healthy competition in telephone service market

A Strong Showing in Phone Service Competition [CableTechTalk]

According to the latest Local Telephone Competition report, released by the FCC this past Tuesday, the phone service market is showing growing competition. The report focused on the telephone industry through the end of 2009.

If you're wondering why the latest report contains data a year old, that's because it is the most recent data the FCC has on the subject.

Opening up the data to both Voice over Internet Protocol (VoIP) service and traditional switched access lines, the FCC found a total of 153 million wireline telephone connections through December 2009. Of that 153 million, 26 million were designated as interconnected VoIP subscriptions, with the remaining 127 million representing traditional switched access lines.

The FCC’s VoIP data included independent VoIP service companies like Vonage, as well as cable and telephone companies that offer VoIP on their networks. Eighty-four (84) percent of the VoIP subscribers were broadband bundle customers, and 87% of these bundles were provided via cable modem.

The FCC also broke down the 153 million connections by residential (45% switched access and 15% VoIP) and business (38% switched access, 2% VoIP).

Cable operators have steadily grown their telephone services with more than 23.5 million customers nationwide, representing one out of every four households.

With the cable companies creating this growing competition in the phone market, there have been drastic savings in home telephone bills. In fact, according to research from Microeconomic Consulting & Research Associates, Inc. (MiCRA), roughly $111 billion will be saved on residential and small business phone bills by 2012.

Challenges to IP service delivery discussed at the Cable Show

Tech Challenges Abound in the New World of IP Service Delivery [The Cable Show Blog]

A large focus of the Cable Show has been on the movement toward IP service delivery. Many believe that IP is the future of the cable industry, but there are very important technical details that create challenges for the transition. 

IP based cable service would result in much more efficient delivery of a wide range of content for cable providers. Content would be transmitted by being broken down into bits and transferred over the Internet.

The problem with the conversion into bits is that there doesn’t appear to be a simple way to effectively identify which bits represent which content. Some of these issues were brought up in my recent post recounting some of Mark Cuban’s thoughts on the TV-over-Internet movement. It would be great if we could enjoy the speed and efficiency of IP-based services, but the trick is to offer these services in a way that doesn’t result in the viewer have to scour the Internet for them.  That's why the current video platform provided by cable operators is so effective -- it manages the video product in a way that it was designed to be consumed -- efficient and well organized.  IP video over the internet is a bit like trying to fit a square peg into a round hole.  It will take some work to make it fit, but once it does, it offers a great advancement in TV viewing options which cable operators will be perfectly positioned to deliver.

Proposals to address these issues are being are being discussed here at the Cable Show.  A couple examples of proposed resolutions are metadata cell encoding to help identify the bits and the creation of a central database of the IP-based content.

Voicemail Express now available to Phone 2.0 customers

I'm pleased to announce Insight has launched a new feature available on our home phone service, in some districts, that allows customers to have copies of their voicemails sent directly to a personal email account.

The service, called Voicemail Express, copies every home phone voicemail message and automatically sends it to up to two designated email addresses. The service is free to Insight Phone 2.0 customers.

The subject line of each Voicemail Express email shows the phone number of the person who left the message. When Phone 2.0 customers spot a message they want to hear, they can simply click on the email attachment, which contains an audio file of the message. The telephone message plays right through the computer speakers.

If a customer deletes an email message by mistake using the Voicemail Express service, the original message will still be waiting in their voicemail inbox. All the features of Voicemail Express are accessible from an easy-to-use online control panel.

Voicemail Express also makes it easy for Insight customers to manage their voicemails online. Customers can create and change their voicemail password, record the name callers hear when reaching voicemail, record greetings callers hear when the phone is not answered, and can access Voicemail Express anytime by clicking “Voicemail” in the top-right corner of the MyInsight.com web site.

The service will be available in some districts immediately and other areas will roll out as we install the technology.  Check our website for availability in your area. To activate the service, Insight Phone customers can visit MyInsight.com and click on “Voicemail,” then enter their phone number and 4-digit password to begin the process of setting up Voicemail Express.

FCC to investigate Google Voice

FCC To Probe Google Voice [Washington Post]

A bipartisan group of lawmakers have asked the Federal Communications Commission (FCC) to investigate Google Voice, Google's VoIP call routing service. The agency, under the leadership of its new chairman, Julius Genachowski, responded quickly by sending a letter to Google late Friday, asking the company to explain their blocking practices. 

Google Voice provides outbound calling for users, but Google blocks outbound calls to certain numbers, including some free conference call services. A group of lawmakers, including House Energy and Commerce Committee members Steve Buyer, an Indiana Republican and Charlie Melancon, a Louisiana Democrat, have written to FCC Chairman requesting the Commission initiate an investigation into Google's call blocking.

Google Voice's call blocking primarily targets numbers in rural areas, due to telephone regulations that require additional connection fees for incoming calls to some rural telephone companies. The lawmakers' letter highlights this fact, calling Google's blocking, "ill conceived and unfair to our rural constituents."

Traditional phone companies are prohibited from blocking their customers from connecting to long distance numbers in the way that Google Voice blocks its users from making calls. While Google Voice's call-blocking scheme may be saving the company the cost of connection fees, it does beg the question how a company that advocates that the federal government adopt network nondiscrimination regulations for the Internet can discriminate which numbers its VoIP service can connect to.

Another VoIP provider blocks calls to free conference services

Speakeasy The Latest VoIP Provider To Block Certain Calls [Techdirt]

Add another VoIP service provider to the list, along with MagicJack and Google Voice, that is blocking access to free conference call numbers for its phone customers. Speakeasy, a VoIP provider which provides phone service using a customer's existing broadband connection, has notified its customers that it will be blocking their ability to call into several free conference call providers. Speakeasy provided the notice along with a list of specific numbers that are blocked out.

Techdirt notes that VoIP service providers that are blocking access to these conference call services are likely doing so due to arcane regulatory rules for long-distance calls that require incoming call providers to pay connection fees to rural telephone providers. Because connecting to free conference call services often incurs these connection fees, some VoIP providers are simply blocking their customers from dialing and connecting to them.

AT&T has requested that the FCC investigate Google's Voice VoIP product, which provides call routing and SMS service due to blocking of calls to certain numbers. While Speakeasy has formally notified customers of the number blocking and posted a list of blocked numbers, neither Google nor MagicJack have done so.

AT&T complains that Google violating net neutrality with Google Voice

AT&T Says Google Voice Violates Net Neutrality Principles [NYT Bits Blog]

In the midst of the kerfuffle over whether Apple or AT&T decided to reject the Google Voice application for the iPhone and why, AT&T has filed a letter with the FCC alleging that Google Voice violates the commission's principles of network nondiscrimination. Google Voice provides users call routing, enhanced voicemail and free text messaging, but apparently doesn't connect long-distance calls to every number. That's what AT&T alleges - that Google discriminates against certain conference call numbers and other phone numbers due to the expense of connecting Google Voice users to those numbers.

Make no mistake, AT&T is simply opening a new front in the battle over allowing Google Voice on the iPhone, which the FCC is currently conducting an inquiry over. But, it has raised legitimate questions about the Google Voice product and whether or not Google is violating the same network neutrality principles that it claims to espouse.

As this article points out, Google's decision to pick-and-choose which phone numbers to connect to is a result of a myriad of long-distance phone regulations, so it remains to be seen whether the FCC considers this issue as a network discrimination case.

MyInsight.com launches today

Today Insight is launching a new web site that will create a whole new portal for our customers to communicate and interact with us. The site is MyInsight.com.

MyInsight.com is the result of a complete rethinking about how we wanted to communicate with customers and other visitors to Insight's web site. Several months ago, we began a process to design a site that reduced visual clutter, provided advanced information about our products, and was easy to use. Many thousands of hours were invested in creating a new way of communicating via our web presence.

One of the new features visitors to MyInsight.com will notice is the 3 Ways to Watch TV under the Digital Cable section that allows users to explore Smart Surfing, On Demand programming, and DVR features on Insight Digital 4.0. Want to know more about how to use Insight's remote and our themed channel line-up - check out Smart Surfing. Interested in learning about the plethora of programming that's available On Demand - see the On Demand section. You can become an expert on recording shows digitally by clicking on the DVR section.

Customers with questions about our broadband and phone products can find additional information in those sections - including updated information about setting up a wireless home network and securing your broadband-connected computers.

One of my favorite updates that MyInsight.com promises is an updated section called Help Central that provides answers to a long list of frequently asked questions about each of Insight's products. Want to know how to pay your bill online or set-up a new email account? Help Central will walk you through step-by-step.

I encourage you to surf on over and check out MyInsight.com. Give the new site's features a try. I think you'll find MyInsight.com to be a much more helpful resource in using Insight's products and interacting with Insight.  But remember, this is just the beginning.  We have lots of new features and updates in the pipeline for Myinsight.com already.  And if you have any suggestions, please post them here -- I'll be sure to discuss them with our product development folks.

J.D. Power survey indicates higher customer satisfaction with cable companies' phone service

Cable Beating Telcos In Phone Service [Broadband Reports]

J.D. Power and Associates has released its latest round of consumer satisfaction surveys for residential phone service, and the traditional providers of phone service - AT&T, Cincinnati Bell - and the other telephone companies came out with lower consumer satisfaction ratings than cable operators' phone service.

The J.D. Power surveys rank the phone providers in five categories, including customer service, performance and reliability, cost of service, billing and offerings and promotions. Each provider is rated on a 1000 point scale, and providers are ranked in four regions - east, west, north-central and south. Cox Communications took top honors in both east and west regions, with Cablevision also receiving high scores in the east region. Brighthouse ranked highest in the south region. Even though J.D. Power routinely includes Insight Communications in their rankings of Internet service providers, we weren't included in these residential phone service rankings.

In each region, cable companies had significantly higher customer satisfaction scores than the telephone companies serving that region. One of the phone companies that Insight competes with, Windstream Communications, had one of the lowest scores in customer satisfaction among all companies that J.D. Power surveyed. This most recent round of surveys continues a trend of cable companies' telephone service outperforming traditional telephone companies' service across the board.

Change is coming, stay tuned for details

If you're an Insight customer, you may be seeing a series of new, short television spots over the coming days that feature the word change. As the first spot indicates, change can be full of the promise of new and wonderful or it can involve anxiety and doubt about the unknown. Here at Insight, we're planning some exciting changes for our customers that will be revealed in the next few weeks. We're working hard to make these new changes to provide more features and updates to our current products while making sure that these changes are simpler to use.

As the ad indicates, stay tuned for details about these changes that will be revealed soon. I'm going to make sure readers of my blog get the earliest scoop about the changes that will be taking place.

VoIP phone service blocking calls to conference call numbers

MagicJack Blocking Access To FreeConferenceCall.com [Broadband Reports]

MagicJack, a VoIP phone service that requires users to connect their phones to a device that plugs into a computer USB port, is under fire for blocking its users from accessing the conference call provider of their choice. MagicJack advertises itself as a cheap alternative to regular, Ma Bell phone service, requiring customers to purchase the device and pay a yearly subscription fee. But for users wanting to access conference call services from FreeConferenceCall.com via their MagicJack, they're out of luck.

Users attempting to call into a conference call number provided by FreeConferenceCall.com find out that their MagicJack won't connect to the conference call number. MagicJack user complaints about their inability to access conference calls have been published on the TechDirt blog and in Broadband Reports user forums. This post indicates that users who have raised these complaints with MagicJack customer service have been told that the company is, in fact, not allowing its customers to access FreeConferenceCall numbers and that they are able to use MagicJack's own conference call service.

Apparently the MagicJack CEO doesn't see any problem with unilaterally blocking users from calling certain numbers, defending the practice to Broadband Reports. For the record, when AT&T and Qwest performed similar call blocking back in 2007, the FCC intervened to stop the blocking.

Cable services bundle is worth $35 billion to consumers each year

Cable Industry Values Bundle To Consumers at $35 Billion Annually: NCTA [Multichannel News]

How much is the bundle of digital cable television, digital phone and cable broadband worth to the American consumer? Based on a report commissioned by the National Cable and Telecommunications Association (NCTA), the cable industry's trade association, the bundle is worth $35 billion each year. Economists Michael Pelcovits and Abigail Ferguson of Microeconomic Consulting & Research Associates completed the report for NCTA, which was submitted to the FCC as part of the agency's annual analysis of competition in video services.

CableTechTalk quotes the report:

"The marginal cost of providing an additional customer with any of the three services (voice, data, or video) is low because of the large economies of scale in deploying a wireline (or fiber-based) network. Moreover, once a customer has subscribed to one service, the marginal cost of providing that customer with a second and third service is even lower."

In addition, these savings can be passed on; according to the report, “[b]undled services are priced between $5.00 and $50.00 lower than the sum of the prices of the components.” MiCRA estimates that that cable’s investments - $129 billion spent in upgrades between 1999 and 2008 - have resulted in about $35 billion in annual consumer benefits. The study shows that the benefits from offering new services and new service bundles are shared across all demographic groups, including lower-income households.

As the cable industry invested in its networks in the later '90s and early part of this decade, upgrading networks to hybrid fiber coax, cable providers the groundwork for advanced services, like broadband and phone and more and higher quality television channels. And the value of those enhanced services is now paying off dividends for cable customers. Around 60 percent of cable customers subscribe to cable broadband and around 26 percent subscribe to digital phone service.

The entire report is available on NCTA's web site here.

AT&T landline customers leaving in droves for cable phone service

Ma Bell and Its Vanishing Phone Lines [GigaOM]

A couple of months ago, I wrote about AT&T's shrinking landline telephone business. In the first quarter of this year, AT&T was losing around 18,000 telephone customers a day, mainly due to customers opting for less expensive phone service from their local cable company. In total, AT&T lost 1.6 million phone customers in the first three months of 2009. GigaOM has a great post about the overall downward trendline that AT&T is experiencing when it comes to basic phone service.

According to Om Malik, three years ago, landline revenues for the phone company were estimated to decline 3.3 percent annually through the end of this year. In reality, those numbers fell off a cliff starting in the second quarter of last year, and are only expected to continue to decline at between 6 percent and 6.6 percent for each quarter through the end of this year.

To combat the number of customers leaving AT&T, Malik appears to argue that AT&T's business strategy ought to shift resources toward deploying its U-Verse video and broadband product because cable customers might switch to AT&T for that product. But the technical problems AT&T faces in upgrading U-Verse to the next level of broadband speeds, faster than it's current theoretical maximum of 18 Mbps, are daunting and they're probably the reason that Ma Bell has significantly slowed down U-Verse deployment.

Fact is, cable's superior broadband speeds and higher capacity coaxial networks are translating into a majority of new customers opting for cable over Ma Bell for their video and data solutions.  And cable's phone product continues to grow at quite the healthy clip.

Why?  Two simple reasons.  First, when Congress passed the 1996 Telecommunications Act, cable operators raised capital and spent over $150 billion over the following ten years upgrading their networks to prepare for the coming revolution in telecommunications.  Meanwhile the phone companies hemmed and hawed and did little investing until they realized that they were risking their very existence by doing nothing.  Then is was simply a game of catch-up. 

And second, even though AT&T's advanced U-Verse product is a big improvement over their conventional DSL plant, they still have to use 100-year-old copper twisted pair technology to reach people's homes from node.  As a result, limitations on broadband speeds and simultaneous high definition viewing are compromises many Ma Bell customers have to endure, depending on where they live.

FCC makes switching phone providers easier

FCC To Shorten Landline Port Window [Broadband Reports]

Yesterday, the Federal Communications Commission backed consumers wanting to switch their telephone service from a telephone company to cable telephone service. Telephone customers looking to save on their monthly bill are turning to cable operators for their telephone service. So many, in fact, that AT&T recently announced that it lost 18,000 land line telephone customers every day during the first three months of 2009. But customers switching telephone providers often run into a run-around from phone companies when they attempt to move their telephone number, called "number porting," from one provider to another. Currently, the telephone company has four days to switch the number, when in reality the action of switching the number takes much less time.

The FCC yesterday decided that customers choosing to switch telephone providers deserve to have a convenient process that's not dragged out over a series of days. Under a ruling, the FCC has now set the number portability window to one business day. Customers who opt to drop phone service from Ma Bell can now have their current number up and ringing on their new provider in 24 hours.

I'm glad to see that the FCC has taken this pro-consumer action that will serve to aid the millions of phone customers nationally that will switch to less expensive cable telephone service this year.

Decreases in landline phone customers create quandry for telephone companies

A Dying Landline Business Sounds a Lot Like Static [GigaOM]

Ma Bell's landline telephone service is definitely not a growth industry these days. In the first quarter of this year, AT&T lost 1.6 million landline phone customers. That's nearly 18,000 AT&T customers who are canceling the phone company's core product offering every day. Although investors seem to believe that phone companies can absorb this decline because the lost customers are simply moving to wireless, many are becoming customers of a cable operator's phone service.

GigaOM raises an interesting question -- whether the shrinking of the landline customer base will eventually catch up to phone company's maintenance of their phone lines. If the lines are not generating the revenue to offset the costs of keeping them up, how will phone companies cope with providing reliable service for their remaining phone customers? One analyst quoted in the GigaOM post indicates that the per line cost of maintaining Ma Bell's phone infrastructure increased from $43 in 2003 to $52 in 2007, driven up mainly from the decline of customers. And while AT&T and Verizon have wireless revenues to offset their losses in the landline business, I wonder how smaller phone companies that don't have these offsetting revenues plan to provide the same levels of maintenance on their phone lines while customers continue dropping their service?

Landline number porting rules may change

FCC May Shorten Landline Number Port Window [Broadband Reports]

Good news may be coming for telephone customers looking to save money by switching their service from the phone company to cable. Broadband Reports writes that the FCC is looking at reducing the amount of time phone companies have to port a telephone number to a new provider when a customer elects to change. Currently landline number portability is subject to a four day deadline from the time the customer requests the change. Compare that to the hours or minutes that it takes wireless providers to change a number.

The FCC appears to be looking at reducing the number port deadline for landlines to 24 hours. The change would make the market more competitive for customers seeking a better deal on phone service because the current process is often takes so long that customers aren't willing to put up with the hassle of switching service providers, even if there's a better deal to be had.

Vonage glitch bills domestic calls at international rates

Why Is Vonage Billing Domestic Calls At International Rates [The Consumerist]

Uh oh. It appears that customers of the VoIP telephone company Vonage are being charged international rates for domestic phone calls. The popular blog The Consumerist profiles the billing issue faced by one customer who called a number in Los Angeles, California, only to be billed nearly $40 for a call half way around the world -- to Algeria.

According to this customer, Vonage admitted that the billing problem is a known issue that is caused by customers who dial a number in the US without adding a "1" before diailing the area code. Vonage's billing system interprets the first two digits of the area code as a country code, so even though the customer is connected to a number in the U.S., the billing system thinks they've dialed an international number. The customer then receives a bill for the "international" phone call.

Comcast to offer a new take on home phone service

Comcast Enhancing the Home Phone [Light Reading's Cable Digital News]

Now that they've cemented their position as the nation's third largest provider of residential phone service, Comcast is announcing plans to change the way the home phone works. In its Jacksonville, and Miami, Florida markets, Comcast is testing a new "enhanced cordless phone" in preparation for a nationwide launch.

What does the enhanced cordless phone do? For starters, it provides a regular VoIP telephone, just like millions of customers already have. The phone also has voicemail, access to e-mail and access to an online address book. On top of that, the phone is set to have some form of web browsing access and instant messaging capabilities. And that's just the introductory version of Comcast's new phone product.

Later versions are slated to have WiMAX connectivity and a built-in QWERTY keypad that promises to make the phone more like a portable computer. All those features for an expected price of about $5 per month. Comcast's senior VP of voice services, Cathy Avgiris, promotes the new phone service as an answer for households that may be looking to replace their wireline phone with a more mobile product.

Columbus television station profiles savings by bundling cable services

Bundle Packages Can Lead To Cable Savings [WBNS 10 TV - Columbus, Ohio]

Columbus television station WBNS did a story last night on cable customers in that market who are saving money by bundling their cable television with broadband Internet and home phone. With the economic downturn, many consumer are looking to save money in many areas of their household budget, and this story outlines one way they can.

Though the cable customer in this story uses a different provider, he says that by bundling all three services together, he manages to save $800 over the course of a year on all three bills. And even though he's a Time Warner customer, the moral of the story is the same for Insight customers - they get the best price for each product when they're bundled together.

If you're interested in finding out how much you might save by bundling, I suggest you head over to this page that describes Insight's product bundles.

Cable company becomes the third largest provider of home phone service

Comcast says it's now No. 3 U.S. home phone provider [Reuters]

Cable company Comcast has been so successful at bringing new digital phone customers into the fold, that as of the end of last year, Comcast has become the third largest phone service provider in the country. With nearly 6.5 million telephone subscribers, Comcast has passed Quest Communications and now only trails AT&T and Verizon in phone subscriber numbers.

Comcast's milestone speaks of the larger trend of phone customers switching from more expensive telephone company plans to cable companies' less expensive, feature rich phone service. Many customers have discovered the significant cost savings of digital phone when bundled with cable television and broadband. And it didn't take long for cutomers to take note of the value that cable companies phone service provides. While the telephone companies have been in the phone business for over a century now, Comcast just began offering telephone service four years ago.

Verizon may offer a phone plan with no outbound calling

Verizon May Offer Phone Service That Doesn't Allow Outbound Calling [Multichannel News - Bit Rate]

Here's a head scratcher. Yesterday, Verizon announced they may offer a new home telephone service offer for their customers. They're calling it a great value in home phone. But there's a catch, subscribers to the new phone service can't call anyone, they can only receive calls. Apologies to Alexander Graham Bell, but I thought the point of a telephone was so that people could call their friends and family not simply waiting and hoping for the phone to ring.

For those of you that think this is a joke, I promise that Verizon's phone offer is very real. It was profiled in yesterday's Wall Street Journal. It's a reaction to the large numbers of Verizon customers who are ditching their Verizon as their phone company and opting to switch to less expensive phone offers from cable operators. In the last quarter of 2008, Verizon lost 670,000 landline customers. Many of those customers are now happy cable customers, with a less expensive phone bill bundled with cable television and broadband. While I'm sure the phone company seriously wants to retain those customers, I can't fathom how they plan to keep them by offering them such a limited phone service.

Do you think they'll use the "can you hear me now?" guy to advertise their "I can't call you, so call me" telephone plan?

Federal court upholds FCC decision on telephone number porting

Court Upholds Cable’s Position On Retention Marketing [CableTechTalk]

An FCC decision that found Verizon had improperly attempted to market to customers terminating their phone service in favor of competitors has been upheld by the U.S. Court of Appeals for the DC Circuit. The issue was heavily debated by the National Cable and Telecommunication's Kyle McSlarrow and Verizon's Tom Tauke at the time of the FCC decision. Basically, the FCC found that Verizon was violating a critical provision in the Telecommunications Act of 1996 that prohibited phone companies from using their 100-year-old monopoly power to stifle competition in the long run.

As I wrote back in June of last year -

There is a very unique process that is required when a phone customer decides to switch carriers. It's called porting the customer's number and it happens when the new carrier notifies the incumbent provider that the customer has decided to switch and the customer's number has to be transferred.

Congress understood that that was a vulnerability in the plan to create competition in voice telephony. Incumbents could transfer that information from the technical department to the retention group to induce customers to cancel their order with the new competitive phone company (like us).

So, the FCC (and now the U.S. Court of Appeals) have told Verizon that they've got the ability to market their phone services to their customers as frequently as they would like until the point they receive a request to terminate service. What they can't do is use their customer's phone number as leverage to try to keep their business.

For customers looking to save money on their phone bill by switching to phone service provided by their cable company, bundling it with video and broadband services, this ruling is a big win. Phone companies must follow the rules and provide a timely number port to the provider of your choice without holding your phone number hostage to a marketing pitch.

New customers choose cable two-to-one over DSL

Cable Beating Back DSL [Broadband Reports]

Third-quarter results are showing that new broadband subscribers are choosing cable broadband at a 2-1 rate over DSL. The gap between cable broadband and DSL continues to grow because of the significant speed differences between the two. Cable broadband is faster than DSL, and promises even faster speeds as cable operators begin to roll out DOCSIS 3.0 technology.  Another BBR report declares that DSL has cemented its title as the next dial-up.

Unlike phone companies, cable companies do not view technology as the end-game of their services.  Instead, it's a means to an end.  Do customers really care if they receive their blazing Internet speeds via a network that delivers their service via fiber to the curb or fiber to the node?  No.  Unless there is a difference in the quality of service.  With DOCSIS 3.0, cable has put to rest the belief that a complete fiber optic rebuild is needed to compete effectively with Verizon's FIOS technology.  Instead, both Verizon and AT&T remain burdened with huge capital investment requirements in order to compete with cable's already-installed platform that easily adds DOCSIS 3.0 to it.

The remaining question is when does Wall Street figure it out and start reflecting these economic differences in the values of wireline phone and cable companies.