AT&T Expands IPTV Footprint

The turf war between Internet providers and cable for the hearts and minds of TV viewers widened by a few thousand. But that’s just the first trickle as AT&T expands its its television service to thousands in San Antonio, Texas.

San Antonio marked the beginning of AT&T’s first IPTV pilot program back in January. Now it’s expanding to thousands more households.

AT&T spokespeople refused to provide specific numbers, saying only the service is being marketed to 5,000 people. Last month, the telecom announced plans to spend $4.6 billion to deliver Internet-based television service to up to 19 million homes across the country.

AT&T said within months it would widen the reach of the San Antonio service, according to a statement.

“This is where the rubber meets the road,” said Patti Reali, Gartner’s IPTV. The battle is engaged in San Antonio, according to Reali.

Ranging in prices from $69 to $124 per month, the three bundles include more than 200 channels (with what one company spokesperson said were networks “similar to cable”), digital music, local programming and premium movie offerings such as HBO and Cinemax.

The service also will offer fast channel changing, a video-on- demand library and a picture-in-picture function. A DVR and high- definition television service will be available later this year, according to AT&T.

Customers can choose between three AT&T Yahoo High Speed Internet packages ranging from the Express version, which offers 1.5Mbps  downloads to 6Mbps at the Elite level.

AT&T is also tossing in three free months in order to entice new customers as part of a promotion running through July.

The expansion should allow AT&T to learn how IPTV handles growth. There are a lot of issues around scaling IPTV service, according to Michelle Abramson, analyst with In-Stat. Today’s announcement, while expected, is the beginning of mass deployments. However, until AT&T releases subscriber numbers, the market will continue to react with some skepticism. “There’s been a lot of inflated predictions,” said Reali.

Although AT&T is reticent on revealing plans for IPTV expansion, the company has said Houston is its next destination. According to the AP, AT&T plans to build a fiber-optic network in a Houston subdivision capable of bringing IPTV to 20,000 homes.

Unlike in many communities where AT&T and rival Verizon must receive local approval to offer television service, last year, Texas let telcos gain a state-wide license. Cable providers oppose such proposals.

In a related move, Verizon introduced its FiOS TV service in the Town of Oyster Bay on Long Island. Unlike AT&T, which carries TV signals via the Internet, Verizon uses fiber-optic connections. Customers can pay $95 a month to bundle phone, Internet and TV service. More than 20 high-definition channels will be offered along with a DVR and more than 2,500 video-on-demand titles, according to a statement.

The introduction of Verizon’s fiber-based Internet TV service follows the Oyster Town Board voting to grant Verizon a franchise to provide television service.

Earlier this month Verizon inked a deal with PBS stations nationwide to multicast public television programming.