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from: News Record

AT&T plans to offer state TV services
By Michelle Jarboe
Article published Aug 1, 2007

Television isn't calling. Yet.

AT&T announced plans Tuesday to invest $350 million to upgrade its North Carolina network, with hopes of launching Internet television services in the state in several years .

But the telecommunications giant wouldn't give a timeline for completing its updates and offering video packages to compete with big cable.

"It's a major initiative, and it's not going to happen overnight, obviously," said Della Bowling , AT&T's market manager for the Carolinas . "I know that (customers) are very excited, and we're trying to get it rolled out as soon as possible here. ... For competitive purposes, we just can't release a lot of information right now."

Upgrading the company's fiber-optic network to provide video and advanced broadband services is all about competition. Major phone providers are vying with cable companies to sell consumers bundles of Internet, television and phone or wireless services.

The phone companies won a major victory in the state last year , with the passage of a law that lets video providers negotiate franchise agreements at the state level and avoid long, costly talks with each municipality. The law, meant to spark competition, took effect Jan. 1 .

AT&T's decision to upgrade its network here is a direct result of that legislation, company officials said Tuesday .

"North Carolina has long been a state whose leaders have understood the wisdom of embracing advances in technology," Cynthia Marshall , president of AT&T North Carolina , said in a prepared statement . "Today, North Carolinians are reaping some of the rewards of that foresight."

Marshall said the state's consumers could be among the first in the region to "enjoy the benefits of cutting-edge competitive video services."

The company, which absorbed BellSouth last year and grew to cover 22 states , has about 1.7 million landlines in North Carolina, Bowling said.

If and when AT&T launches television here, the likely candidate will be AT&T U-verse , an Internet-based video service sent over the same network the company uses to serve landline phones.

U-verse is available in 23 markets — none in the Southeast — and had 51,000 subscribers at the end of the second quarter .

AT&T hopes to offer U-verse to 18 million households by the end of next year. The company has not filed for a state video franchise in North Carolina, according to records from the Secretary of State .

But officials said Tuesday that AT&T could release details about U-verse's regional rollout later this year .

That doesn't have local cable operators too worried, though.

"Phone companies are making a lot of promises, but as they've said themselves, they're years away," said Buck Yarborough , a Triad spokesman for Time Warner Cable .

"We already compete with other providers ... for entertainment and information dollars," he added. "Competition's nothing new for us."

It's unclear what the impact on consumers might be if competitors such as AT&T muscle their way into the video market here.

Opponents worry new providers might target wealthy customers and bypass rural consumers, while proponents claim that competition could yield lower customer bills.