Let the Price Wars Begin

The Advocate has a breaking news story,Cox Communiations offers phone service, that reports that Cox will begin offering VOIP to its Baton Rouge customers tomorrow, Tuesday the 19th. They are straightforwardly targeting BellSouth and offering their new service at a 10 percent discount BellSouth prices. There is a discount as well for buying into their “triple play” of VOIP, digital cable, and internet.

Announcements in other venues (CNET, internetnews.com) promise that VOIP will be coming to Lafayette, among other locales, in November or before the end of the year.

Cox is throwing down the gauntlet. If Cox’s new service makes significant inroads BellSouth has nothing to respond with but price cuts of its own. It ought to be fun to watch.

UPDATE 6:00 am, 10/19/04: The final version of the story has appeared online and it contains further details of the plans being offered by Cox and a response from EATEL. In Ascension parish Cox will be going head to head with EATEL’s new fiber to the home service-based version of the triple play. The locally-owned telephone company will be putting its service into operation early in the coming year.

Lisa Froman, spokeswoman for Eatel, said the Gonzales-based telecommunications company is headed in the same direction with so-called “triple play” service of phone, Internet and television service…

“This whole bundling idea is going to be very important to us in the future,” she said.

Froman said Eatel is not building its fiber network outside Ascension “just yet.”

While Eatel is not going after new telephone customers in East Baton Rouge Parish, when it entered the market it undercut BellSouth’s prices by about 20 percent.

A BellSouth spokesman could not be reached for comment.

All very interesting. Especially the implicit threat from EATEL to build it fiber beyond its home in Ascension parish.

An earlier Advocate story also hinted at EATEL’s long-term plans:

Eatel’s plan is to eventually connect all of its Louisiana and southern Mississippi customers by fiber optics, which Ahern said will be the platform for the next half-century.

“Over the last 130 years, telephone companies have relied on copper, and we’ve spent a lot of money trying to make that copper do more. So, we can provide DSL service over copper today,” he said. “Now we’ve decided it would be better to provide fiber to the home and let that take us out for the next 40 to 50 years.

All of this can only be good for consumers.

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