Packet protector

SBC has just moved into the next phase with two great Bell company experiments. With last week's residential voice-over-IP launch, the RBOC is biting back at the upstart contenders to its voice services title. By committing $400 million to Microsoft's IPTV platform, SBC is renewing a video vision that once held much promise. These new services provide a glimpse at the broadband future, in which many telcos will be providing triple-play services over broadband infrastructures. But for now they might be little more than elements of an elaborate defense system.

Time will tell just how successful SBC will be in both of these cases, but how much time it will take is largely up to the company itself. Will SBC be satisfied with merely protecting its turf, or will it aggressively seek to dominate the service markets that likely will come to define telecom's future?

To date, residential VoIP competitors such as Vonage and AT&T have been fairly successful in wooing customers away from traditional service providers, and they have done so primarily by edging ever lower with their prices. SBC brings vast marketing dollars, a historic reputation for reliability, expanded call management features and its own service-bundling capability. Yet how the service will be priced and packaged, and exactly to whom it will be offered, remain to be seen. In early 2005, we will start to see whether SBC really wants to be a dominator, or just a defender.

The same can be said of the carrier's foray into IP-based video. Its dollar commitment is impressive, but it's still not clear how SBC will take advantage of the capabilities that the still-unfinished IPTV software platform promises. It might be happy to create bundles that are just different enough to keep its current customers, but will it only play the video card if it has to, or will it cut a competitive path into cable TV providers' kingdoms?

SBC's recently-accelerated Project Lightspeed investment plan is an impressive display of exuberance by an often more methodical company.

By sometime next year, we should have an idea whether SBC will use its newfound nimbleness to truly change the industry or just keep the status quo.

E-mail me at doshea@primediabusiness.com