ATT Enhances U-verse IPTV Service

ATT has introduced new features to its U-verse IPTV service to make it more competitive with cable and satellite companies:

• The ability to set or delete recording as well as watch recorded programs from any of up to eight TVs in the home.
• An increase of speed from 10 to 12 Mbps for those subscribed to this level of service.
• A video on demand recommendation service based on the viewers ratings of past selections.
• An improved interface for web connected PCs for controlling the recording function on the set-top box.
• Improved navigation in using U-verse from the TV.

ATT is strongly promoting its remote DVR capability in its TV ads. It has found a unique feature that seems to be gaining traction.

ATT Adds 284K IPTV Subscribers in 1Q09

ATT added 284,000 IPTV subscribers in 1Q09, leaving it with a total of 1.329 million at the end of the quarter. Over the same period it added 359,000 broadband subscribers, giving it a total of 15.436 million.

ATT continues to make good progress in spite of the difficult financial environment. It will easily exceed 2 million IPTV subscribers by the end of 2009 if it maintains this rate. It now sees its IPTV service as a significant driver for its broadband business.

Time Warner Modifying Usage Caps

Light Reading published an article describing how Time Warner is modifying its usage caps and another article listing the usage caps both Time Warner and ATT are offering in Beaumont, Texas. Time Warner is offering a higher tier that offers a higher usage cap.

These caps range from 5 GB per month to 150 GB per month.

It is always interesting to calculate how much HD TV viewing that these caps will permit. A cap of 10 GB permits less than 3 hours of HD viewing in the month. A cap of 100 GB permits less that 1 hour of HD viewing per day and a cap of 150 GB permits less that 1.5 hours per day.

Clearly these caps will discourage the use of the broadband service to deliver video to the TV. This is certainly a way that the telcos and the cable companies can keep their customers on their own TV services and away from over the top Internet TV services.

ATT 3 Screen Masters Golf Tournament Coverage

ATT is providing coverage of the 2009 Masters Golf Tournament over its U-verse IPTV service, to the PC, and to mobile phones. Live content to all three screens includes:

• Par 3 Contest, which featured a live feed from the contest on Wednesday, April 8.
• Masters Extra, which gives AT&T viewers one hour of coverage before cable and network broadcast coverage begins.
• Amen Corner Live, which features live coverage of the 11th, 12th and 13th holes.
  15th/16th Live, which features live coverage of the 15th and 16th holes.

On demand coverage includes:

• Masters Moments, featuring a series of 24 vignettes from past Tournaments available to U-Verse and PC viewers.
• Multiple Player Interviews, offered daily via U-verse TV VOD, the PC, and mobile video.
• Masters TV, including daily previews and recaps available via to the PC and mobile video.

This is a nice set of 3 screen programming. It does show the complexity of making this kind of offering. Consequently, compelling 3 screen programming will continue to be limited to these special events quite a while.

ATT to Slow U-verse Deployment

The latest DSL Prime email from Dave Burstein stated that ATT will reduce the number of new homes added to the U-verse foot print from 8 to 9 million in 2008 to 4 million per year through 2011.

This looks like a result of the current financial fiasco. ATT's U-verse has been quite successful, I wonder why the company is backing off now. Maybe because it is starting to understand the limits of its VDSL approach compared to Verizon's fiber-based approach.

Charter Introduces 60 Mbps Cable Modem Service

Charter has introduce a 60 Mbps downstream DOCSIS3.0 cable modem service in St. Louis, Missouri. This service will be priced at $129 per month for its video customers.

This is a premium offering that goes well beyond what ATT can offer with U-verse. Not too many people can afford such a pricey package, so it is not a direct attack on U-verse. Charter will have to bring the price of the service down before it will make a real dent in ATT's success.

ATT Adds 264K IPTV Subscribers in 4Q08

ATT added 264,000 U-verse IPTV subscribers in 4Q08 ending the year with 1.045 million subscribers. The company achieved its goal of 1 million IPTV subscribers by the end of 2008. Its U-verse service now reaches 17 million homes.

ATT completed its rollout of its whole home DVR and two stream HD support by the end of 2008.

ATT made good progress and has established U-verse as a significant competitor in the U.S. pay TV market. It has stated that it will continue its investment in this service while it cuts CapeEx in other areas.

ATT User Experience

Alan Weinkrantz has written a blog posting describing how he got ATT to drop his cost for a triple bundle from $164 per month to $94 per month by threatening to move to a competitor.

This shows how competitive it is becoming where Telco IPTV services are available in the U.S. I am sure that the cable companies are making similar offers to minimize churn.

ATT Reaches 1M IPTV Subscribers

ATT announced that it will reach 1 million U-verse IPTV subscribers in a few days. It expects that the service will pass 17 million homes by the end of 2008. It is also achieving 10 percent penetration within 12 months of entering a new market.

ATT also said that its U-verse service install times have decreased by 17 percent since 4Q07. More than 90 percent of its U-verse subscribers also subscribe to a broadband data service. 54 percent of its U-verse subscribers did not previously subscribe to DSL services.

ATT has put U-verse on the map as a major competitor in the U.S. pay TV market. The U.S. cable companies clearly have to include ATT as well as Verizon in their competitive calculations.

Microsoft Mediaroom Supporting 2M Subscribers

The Microsoft Mediaroom IPTV software now supports 2 million subscriber homes, doubling in less than one year. There are nearly 4 million set-top boxes worldwide in these homes. In the past quarter , 500,000 new Mediaroom subscribers globally. ATT is one of Microsoft’s fastest-growing Mediaroom customers with 781,000 AT&T U-verse IPTV subscribers.

Microsoft is reaping the rewards of its Tier 1 carrier wins. It moving into the number one position with merchant software packages.

DOCSIS 3.0 is Cheap

An article on Light Reading cited a statement by Charter Communications that it will cost about $8 to $10 per subscriber to bring DOCSIS 3.0 services to a home, including the new cable modem termination system (CMTS) equipment and the routing systems. It does not include the cost of the new DOCSIS 3.0 cable modem or the cost of provisioning the service.

Verizon has said that it costs them $800 to $1,000 per home to make its FiOS fiber service available with a maximum 50 Mbps data service today. The cable companies can accomplish the same thing for one percent the cost. DOCSIS 3.0 will provide the cable companies a strong defense against FiOS and be a very strong offensive weapon against ATT's VDSL U-verse service.

AT&T to Test Bandwidth Limits

ATT has begun a test in Reno, Nevada that will set monthly limits on broadband users and charge them if they exceed the caps. The trial at first will affect only new DSL users, who will be limited to 20 to 150 gigabytes of monthly downloading depending on their account. Users who go over eventually will be charged $1 per gigabyte, but only after they continue to exceed their limit after two months of warnings.

In December, the test will be applied to existing Reno DSL subscribers. The caps are:

• 768 Kbps - 20GB monthly limit or 11 min. per day of HD or 44 min. per day of SD
• 1.5 Mbps - 40 GB or 22 min. per day of HD or 89 min. per day of SD
• 3 Mbps - 60 GB or 33 min. per day of HD or 133 min. per day of SD
• 6 Mbps -80 GB or 44 min. per day of HD or 178 min. per day of SD

These limits are not a huge burden for web surfers or even Youtube viewers. They do make a big difference for people who will want to use their broadband connections to use their broadband connection to deliver content to their TV, especially HD content. These caps will make over the top Internet TV services less competitive with ATT's U-verse IPTV service.

ATT Adds 232K IPTV Subscribers in 3Q08

ATT added 232,000 U-verse IPTV subscribers in 3Q08, ending with 781,000 subscribers. Its U-verse service now passes 14 million homes. There were reports that 100,000 of these IPTV subscribers are in Houston, where U-verse was introduced in November 2006.

ATT’s roll out of Total Home DVR service is under way and expected to be completed by the end of the year. Attach rates for broadband service continue to be high, at more than 85 percent. In October, ATT announced agreements with Circuit City and Wal-Mart to sell U-verse TV and U-verse High Speed Internet in more than 600 retail locations.

ATT is well on its way to meet its goal of 1 million U-verse IPTV subscribers by the end of 2008. Only the sad state of the U.S. economy might keep ATT from reaching its goal.

ATT Backs Off in San Francisco

ATT has run into problems bringing IPTV to San Francisco. It withdrew its proposal to place 850 VDSL systems onto San Francisco's streets after a hearing at the Board of Supervisors that concluded that the project did not meet environmental review exemption requirements. The proposal had been previously agreed to by the city's Planning Department.

Each of the VDSL would be placed on city sidewalks and are 4 feet high, 4 feet 2 inches wide, and 2 feet 2 inches deep. Ten neighborhood associations objected and appealed Planning board's ruling to the Supervisors.

I live in San Francisco, so this affects me personally. These are big boxes and would impede pedestrian traffic on many sidewalks. Two years ago ATT sent me and my neighbors letters asking if they could put one of these boxes in my front yard. I thought that would be cool but my wife said, "you have to be kidding!" None of my neighbors agreed either.

San Francisco is always an exception, but I expect that ATT may receive similar objections in other dense cities. This may also be a problem with other VDSL deployments, especially in Europe, if the residents of the cities involved have any say about it.

Since I will not be able to get U-verse any time soon, I will move ahead with my plan to set up an 802.11n network in my home so that I can start using over the top Internet TV content. I really have no interest in subscribing to cable or satellite service.

ATT Introduces Whole Home DVR

ATT has introduced the whole home DVR feature provided by its Microsoft Mediaroom software. Viewers will be able to record up to four programs simultaneously and will also be able to play back up to four recorded programs at once. It will store up to 37 hours of HD content or 133 hours of SD content. It will also be possible to schedule recording on the DVR from a remote PC or a mobile phone.

The demonstrations of this feature that I have seen were quite attractive. I would certainly be happy to have it myself. The only caveat is that its ability to record four HD streams simultaneously will be limited by the amount of bandwidth available.

ATT Introduces Interactive Fantasy Football on IPTV

ATT announced the launch of Yahoo! Sports Fantasy Football on AT&T U-verse TV. Viewers can use the interactive AT&T U-bar to track their fantasy football team and receive customized information on their favorite NFL teams on their U-verse IPTV service.

AT&T U-bar is an interactive feature available to U-verse TV customers that allows viewers to receive customized sports, weather, stock and traffic information on their TV. Yahoo! Sports Fantasy Football is one of several U-bar enhancements now available to U-verse TV customers at no extra charge.

Fantasy football enthusiasts can also purchase StatTracker®, a real-time application that tracks player, team and league statistics, for $9.99. StatTracker delivers snap-by-snap updates to users via AT&T U-bar, personal computers and mobile devices.

AT&T is taking advantage of its IP network to differentiate its IPTV service from its cable competitors. Sports is important to many viewers and is a good place to start these services.

ATT Adds 170K IPTV Subscribers in 2Q08

ATT ended 2Q08 with 549 thousand U-verse IPTV subscribers, adding 170 thousand during the quarter. This is an increase of 318 thousand since the end of 2007.

The U-verse service is now available to 11 million homes and has reached 10 percent penetration in established markets in less than 12 months. ATT said that it is on track to reach one million IPTV subscribers by the end of 2008. It has reduced its average installation time by 15 percent since 4Q07.

ATT plans to have a second HD stream to all U-verse subscribers in 3Q08. It has Microsoft's whole home DVR feature in trial and expects to roll it out before the end of 2008.

If ATT maintains its current rate of growth for U-verse, it will have no trouble reaching one million IPTV subscribers by the end of 2008. The U.S. cable companies will have to start taking notice of ATT as they have with Verizon.

Verizon to offer 50 Mbps FTTH

Verizon will offer a FiOS FTTH service with 50 Mbps downstream speeds and 20 Mbps upstream speeds across its entire FiOS footprint. This service will be available for $89.95 per month in New York and Virginia and for $139.95 elsewhere. It also offers a service with 20 Mbps in both directions for $64.99 in all markets.

Verizon is raising the broadband performance bar. The cable companies will have to respond with similar DOCSIS 3.0 offerings to remain competitive. This also shows the advantage of Verizon's FTTH strategy compared to AT&T's VDSL strategy. ATT offers a maximum of 6 Mbps today which will increase to 10 Mbps later in 2008 when it introduces its channel bonded service.

ATT Reaches 379K IPTV Subscribers

ATT added 148 thousand IPTV subscribers in 1Q08 giving it a total of 379 thousand at the end of the quarter. It stated that it has achieved over 10 percent penetration in its established market areas in less than 12 months. Its U-verse IPTV service can now reach more than 9 million homes. The company stated that it is on track to achieve its goal of 1 million IPTV subscribers by the end of 2008.

ATT needs to increase its average to a bit over 200 thousand new subscribers per quarter for the rest of 2008 to achieve its goal of 1 million IPTV subscribers. It subscriber adds increased by 43 thousand in 1Q08 over 4Q07. It appears that its goal is well within reach. I think the major U.S. cable companies are going to start to take notice of ATT.

ATT Has 231K IPTV Subscribers

ATT now has 231 thousand IPTV subscribers and expects to have more than 1 million by the end of 2008. It has found that 90 percent of its U-verse IPTV subscribers also take a broadband service. It also has found that 60 percent of its subscribers were former cable users.

ATT has also found that U-verse is affecting cable pricing based on the reaction of the cable companies to its introduction in a new area.

ATT is continuing its progress an its target of 1 million IPTV subscribers by the end of 2008 seems to be well within range.