Senin, 14 April 2008

If you need more proof that phone and cable companies are locked in a bitter struggle to control telecommunications, Verizon Wireless and Time Warner Cable are a good example. Verizon filed suit in federal court this week alleging that a TWC ad falsely compares its cable offering to Verizons FiOS network.

The TWC ad features a door-to-door salesman pitching "Fiber!" When he waves his hands, he creates magical swooshes, suggesting that Verizon is casting a spell over customers by the mere incantation of "fiber." In the ad, a homeowner responds that TWC has "been using fiber optics for over a decade. Welcome to the program!"

INJUNCTION SOUGHT

According to The Wall Street Journal, Verizon claims the ad falsely implies FiOS requires a satellite dish for TV service; that it cant bundle Internet, video and phone service; and that TWCs use of fiber optics predates Verizons.

Verizon is asking the court for an injunction to stop the ads, to award damages and to order that TWC run corrective advertising.

TWC spokesperson Alex Dudly responded, "We feel the suit is without merit, and we look forward to defending against it in the appropriate venue."

FIOS IS FASTER

When the ad first ran in February, Verizon executive John Czwartack wrote on the companys policy blog that a colleague had this reaction: "Lets see ... according to their Web site Id get a blazing fast 1.5-Mbps connection and "digital phone local only" voice in addition to cable service. ... Unfortunately Im not interested, because with my FiOS bundle I have a [faster] FiOS Internet service, local plus unlimited long-distance calling, plus three phone features -- all enabled by fiber straight to my door."

The FiOS network is indeed substantially faster than current cable offerings, network consultant George Ou said in a telephone interview. FiOS delivers 622 Mbps downstream and 155 Mbps upstream -- bandwidth shared among just 32 users. A TWC Web page says its service offers a maximum of five Mbps downstream with typical speeds between 0.3 and 1.1 Mbps.

Comcast recently announced it will roll out this year an upgraded cable Internet package with speeds as high as 50 Mbps. The initial implementation will be in the Minneapolis/St. Paul region. Comcast will achieve those speeds by upgrading to DOCSIS 3.0 and bonding channels together.

But, Ou pointed out, those speeds measure capacity to an entire neighborhood, not an individual home. Compared to FiOS delivery of 622 Mbps to 32 users, Comcast and other cable companies that follow suit will be offering no more than 80 Mbps to several hundred users.

VERIZON AD CRITICIZED

Verizon is no stranger to improper advertising, though. The company agreed Friday to pull an ad containing an out-of-context quote from CNET News.com. The ad uses the quote, "a near-flawless experience," in a way that clearly suggests the technology Web site was reviewing the service.

In fact, reporter Marguerite Reardon was describing the competitive landscape for digital television. "This fierce competition reinforces how important it is for Verizon to offer a near-flawless TV experience," Reardon wrote.

Verizon said the ad would be pulled after its initial run concludes May 15. Verizon executive Eric Rabe said there was no comparison between the ads. The CNET article, while not a review, was positive about FiOS and "a fair reading of the CNET piece is that Verizon knew we had to provide near-flawless TV (and we did)," he wrote.

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