Comcast Exchanges Mickey Mouse for VoIP

Comcast has given up on its plans to purchase Disney and has joined rivals Time Warner Cable, Cablevision Systems Corp., and Cox Communications Corp. in announcing that by 2006 it will offer VoIP telephony services to 40 million people in Comcast supported markets. "...Comcast is far larger than its competitors and analysts say it offers the biggest long term threat to telecom carriers," writes Michael Learmonth of Reuters.

But Ben Chamy at CNET News.com reports that another set of analysts "said it may be too late to do Comcast much good." Chamy points to Frost & Sullivan analyst Jon Arnold -- "2006 is really far away, so you can read that as a cynically cautious piece of news. The game will be over by then" because of VoIP offerings from the traditional telecommunications companies.

Credibility and reliability as a telephone network operator could hurt Comcast as well. "Nevertheless, it's still unclear whether consumers will be willing to move from their reliable telephone companies to a cheaper, but less dependable, VoIP service from cable operators writes Antone Gonsalves for TechWeb News. He points out that a VoIP phone will not work during a power outage and issues must still be resolved in providing 911 emergency services.

But Om Malik thinks "...this is good use of Comcast’s natural abilities which is running a cable network and maximizing the returns on the coaxial." He points out how quickly Comcast became a player in the consumer Internet broadband access market and predicts similar success with VoIP.

Om raises a warning, however, about whether Comcast will be a good corporate citizen or will engage in "dirty tricks." Agreeing with this point, Brian Kane blogs, "Just wait until they tell you that you have to subscribe to some package of useless telephone services just to have dialtone. Just wait."

Whether or not Comcast is successful, and whether or not they will work cooperatively within this emerging industry, "Still it’s a good day for our industry when 40 million people become 40 million prospects." observes Greg Galitzine.