Mediacom Communications Corp. is joining the Voice-over-IP chorus, striking a deal with Sprint Corp. to provide telephony services to most of its markets in 23 states during the first half of 2005.
Under the partnership, Mediacom will use its coax cable connections in the house to offer service via an integrated telephony cable modem with a battery backup. Calls will be routed through the cable plant to interconnections with Sprint's IP voice network. Sprint will supply the network provisioning, switching and interconnections to the public switched telephone network, as well as enhanced 911 emergency service, local number portability and directory assistance. The service will offer customers caller ID, call waiting, call forwarding and voice mail, among other features.
The MSO is also planning to offer a voice-only service to customers, to further widen the subscriber net.
"We're looking at the 2.7 million homes that we potentially could serve with any of our products," noted John Pascarelli, Mediacom's executive vice president of operations. "Now, we will price things to reward consumers that buy multiple products for us — there is no doubt we plan on doing that. But we still think we'll be able to provide a voice product to a non-subscribing video household at a compelling price point compared to what they are paying today."
Pricing for the service has not been set as yet, but it will likely fall in the $40 range to make it competitive with telco operators, Pascarelli said.
"We've talked about the market price point of $40, so I don't think we'll be far off that," he said. "And it will be unlimited, any-distance calling within the U.S. And the fact is in a lot of our markets that is a huge advantage because with the local independent phone companies that are there, they charge for a lot of regional calling."
It is the second major MSO to forge a VoIP deal with Sprint. In December, Time Warner Cable announced it would partner with Sprint to extend VoIP service in 17 markets. Nebraska-based MSO USA Companies has also tapped Sprint to support a VoIP service that will go out to about 62,000 subs. Sunflower Broadband, meanwhile, has a deal to bundle in Sprint PCS services.
Pascarelli said adding VoIP service is a natural evolution for Mediacom, which has in the past three years made significant plant upgrades and expanded its service portfolio to include data.
"For our consumers, it's just going to be more choice in a market that they have had very little choice for a little more than 100 years now," Pascarelli says. "We're going to come in and give you an alternative now, and hopefully that alternative is something you will see value in."