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BellSouth to bundle DirecTV

Tue, 08/26/2003 - 8:00pm
Jeff Baumgartner

BellSouth is the latest telco to raise the competitive ante with cable operators by partnering with a large DBS company.

Beginning early next year, BellSouth will market services from DirecTV Inc. to residential customers in its nine-state region (Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina and Tennessee).

BellSouth said DirecTV is its exclusive partner for DBS digital satellite television, ostensibly removing EchoStar Communications from the picture.

The telco will also use the DBS platform to further its bundling strategy, noting that customers will have the ability to pay for DirecTV, high-speed data, wireless and telephony services from the same bill. BellSouth said customers will receive service bundling discounts, but was not more specific.

By partnering with DirecTV, it's also a clear indication that BellSouth has placed any video plans involving technologies such as ADSL or VDSL on the backburner.

"We are not talking about a short-term fix," said Bill Smith, BellSouth's chief product development and technology officer, in a statement. "We are looking to a long-term business relationship with DirecTV."

BellSouth is just the latest telco to put its video eggs in DBS' basket. Earlier this year, Qwest Communications inked deals to co-market EchoStar services in Colorado and Nebraska, and DirecTV in Phoenix, Tucson and Seattle. SBC, meanwhile, has a similar deal with EchoStar.

Though cable has yet to respond to a high-speed data price war initiated by the telcos by lowering their own prices, some analysts believe that the recent partnerships between the RBOCs and DBS providers could cause cable operators to accelerate their IP telephony plans.

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