Those Bell Mergers Are Giving Cable Companies Even More to Worry About

[SOURCE: New York Times, AUTHOR: Ken Belson & Geraldine Fabrikant]
In the chess game between the cable companies and their nemeses, the Bell phone companies, the Bells may be gaining ground. Phone mergers — including AT&T's recent proposal to take over BellSouth — could give the Bells more power to cut prices, move faster into television and expand their advantage in the wireless market. The AT&T-BellSouth deal, which is likely to take at least a year to be approved, will significantly alter the competitive landscape for the fragmented cable industry, if not immediately then certainly over the next few years as the Bells offer more — and cheaper — video and Internet services. Sheer size also helps the Bells throw their weight around in Washington. Last week, lawmakers began drafting a bill to make it easier for the Bell companies to acquire local television franchises, a move that would help speed up their push to sell TV programming over high-speed lines around the country. If Congress approves the proposed national franchise legislation, AT&T and Verizon could offer those services in hundreds of cities years ahead of schedule. By 2010, the Bells are expected to add six million video customers for a 5 percent share of the pay-television market, according to Kagan Research. While that is just one-tenth the number of cable subscribers, the Bells' additions will come at cable's expense, Kagan estimates showed.
http://www.nytimes.com/2006/03/13/business/13cable.html
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