AT&T Homezone goes wide

AT&T today took the wraps off its Homezone service, announcing the integrated DSL/satellite TV home networking service is now available in 12 of its 13 states, the exception being Connecticut.

Homezone uses a gateway device designed for AT&T by 2Wire to tie together DISH Network satellite television with AT&T Yahoo! High Speed Internet and AT&T Home Networking in a way that allows Web-based content, such as photos, music, and some video content, to be displayed over a networked TV, creating what AT&T calls a “digital living room.” The service was announced in January 2005 and has been available in San Antonio, San Diego and parts of Ohio before now.

Homezone is considered a complementary service to AT&T’s U-Verse, the service bundle associated with the company’s fiber-to-the-node buildout known as Project Lightspeed, and a service that can be offered in advance of having access networks upgraded.

Right now, it’s actually a richer service, said Vince Vittore, Yankee Group broadband analyst.

“AT&T has made it clear that in markets where they have U-Verse and Homezone, U-Verse is the lead service,” he said. “I think it is a better product right now than U-verse because it has more features--it has more applications and niftier toys to play with. U-Verse will catch up, but it’s not there now. The question for Homezone is whether it will sell any better than AT&T’s previous DISH Network efforts, because they are doing pretty well already. I’m not sure there is evidence this will sell better.”

One major stumbling point for Homezone is the lack of high-definition TV, something AT&T says is coming with a newer version of the 2Wire gateway.

“You have to have HD now,” Vittore said. “If you look at how many HD sets are being sold right now--this is going to be a huge HD Christmas. AT&T has to get it into HomeZone, and they have to get it into U-Verse.”

“We know HD is very important,” said Ken Tysell, executive director of entertainment services at AT&T. “We will begin offering an HD receiver for Homezone in 2007.”

The company is testing HD for U-Verse in Houston and said during its earnings call last week that it will include HD in the 15 markets it plans to add to U-Verse by year’s end.

To promote the service, AT&T is offering new subscribers a $30 Visa gift card.

Homezone’s integration enables customers to program digital video recorders via a PC and will include delivery of Akimbo’s video-on-demand service as well. AT&T announced last June that it is investing in the IPTV start-up.

Customers will typically see an ad and call in to an AT&T service center to order Homezone, Tysell said. “The service representative can order the different pieces of the service for them--AT&T Yahoo! High-Speed Internet, the gateway and the DISH service,” he said. The gateway will be shipped to the customer along with DSL software to enable a self-installation of the DSL service. A DISH technician will then be dispatched to install the satellite dish and DISH receivers.

All services are enabled by the TV remote control, which aids the customer through a series of menu-driven options to access TV, video, music or photos, said Paul Brunato, head of corporate communications for 2Wire.

“It’s a very intuitive interface,” he said. Homezone allows customers to program their DVRs from any Internet connection and to access Internet content such as Yahoo! Launchcast Radio over a home entertainment system, he added. Consumers can upload their CDs as MP3 files on a PC and then listen to them over the system as well.

Access to Web-based video will be based on rights to that content, Tysell said, and that is being negotiated by AT&T for both Homezone and U-Verse.

“The user interface is intended to make it transparent to the customer as to whether the content is coming down via satellite or is coming over the DSL line,” he added. “It is very easy to navigate between TV, music, photos or other content.”

Homezone initially will be available only to new DISH Networks customers, although some existing AT&T/DISH customers will have access to Homezone by the end of the year, Tysell said. Others, who were signed up during the days when AT&T and DISH had a revenue-sharing model, should be able to get Homezone by early in the second quarter of 2007.

Connecticut is also scheduled to get Homezone in 2007, once back office integration issues have been worked out, Tysell said.

Homezone initially will drive two TVs, although consumers may choose to buy other DISH set-tops for other TVs in the house, Brunato said.

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