AT&T SPELLS OUT PLANS FOR MULTIPLE-ISP MARKET TRIALS
WESTMINSTER, Colo. -- Looking beyond its limited technical and operational test of multiple-ISP choice in Boulder, Colo., AT&T Broadband plans to start larger marketing trial in Boulder in May and much bigger marketing trial in Boston area in fall. Speaking at CableLabs media briefing here Wed., AT&T Broadband Senior Vp Susan Marshall said MSO would test carriage of up to 10 ISPs in each market as it prepared for commercial rollout of service in major cable markets, starting in mid-2002. She said company also would test choice of transmission speeds and prices, as well as choice of various additional services. “We are very, very committed to this,” she said, saying that company had spent $20 million getting ready for its trial in nearby Boulder and was likely to spend another $20 million preparing for its Boston pilot.
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AT&T’s unveiling of its ramp-up plans came as FCC continued to weigh responses to its cable open access notice of inquiry last fall. It also came as AOL Time Warner continued to conduct its similar trial of multiple-ISP choice in Columbus, O., and Comcast and Cox prepared to begin their own small tests. Marshall said AT&T officials hoped that trials “will convince the government not to get involved” in regulating open access: “We think that left to our own devices, market forces are going to work.”
Marshall said AT&T Broadband, which is testing its “broadband choice” service in more than 300 Boulder homes after first promoting it to 9,000 households, would extend its marketing reach to as many as 18,000 Boulder households in 2nd phase. In Boston area, she said, MSO will greatly increase that number, offering service to tens of thousands of homes. “Boulder is not really giving us a lot of scale information,” she said. “That’s why Boston is important to us.”
Marshall said AT&T Broadband engineers would limit number of ISPs in each market to no more than 10 for now because of concerns about overloading company’s policy-based routing technology. “If we get over 10 in a geographic area, we will have performance degradation,” she said. However, she said 10 ISPs was “probably a good number” because most of nation’s 7,000 ISPs were very small, local players.
Currently in Boulder, AT&T Broadband is testing carriage of 4 ISPs -- AT&T WorldNet, EarthLink, Excite@Home and Juno Online Services -- with 4 others preparing to begin service. AOL Time Warner, while invited to participate by AT&T, is not among those 8. “I think they just had a lot going on in the last year,” Marshall quipped, referring to grueling year-long approval battle over AOL’s takeover of Time Warner.
In Boulder and Boston, Marshall said, AT&T Broadband will offer 3 types of connections to ISPs -- connecting at local point of presence, riding on AT&T’s backbone or bringing their own backbone and going “peer-to-peer” with AT&T’s backbone. She said MSO would offer subscribers choice of 3 or 4 differently priced “speed tiers,” similar to DSL providers, as well as parental control, personalization, other features. Customers will be able to choose more than one ISP, and ISPs will be able to bill their subscribers directly. Marshall, while declining to discuss wholesale price that AT&T Broadband will charge outside ISPs for using its network, said she expected they would bill subscribers about same $39.95 per month as AT&T charged customers for its Excite@Home house brand.
In near future, AT&T officials said they saw further revenue possibilities from charging subscribers and ISPs for other advanced services, such as home networking, firewall, home monitoring, videophone, home security, antivirus protection. They also saw potential in charging for “quality of service” feature, which would give higher network priority to such urgent data streams as voice messages. They are counting on signing up undisclosed number of extra high-speed data subscribers, thanks to marketing efforts of participating ISPs. “We think it’s a really fabulous opportunity for AT&T,” Marshall said.