AT&T Takes U-verse Beyond Milestones, Into '09

Having met its goal of 1 million U-verse TV subscribers by yearend, AT&T Inc. (T) is doing anything but easing up on the gas. In fact, it has been extending the service into new markets and with new voice capabilities, while many downshift into the holidays.

At last check, U-verse was available in more than 70 markets in 16 states. The carrier’s territory spans 22 states. It has used DISH Network to reach far flung and rural residences and will switch to DIRECTV Group Inc. (DTG) in February.

To recap, AT&T claims to have also accomplished the following: rolling out its total home DVR feature in all markets; deploying support for two concurrent HD streams per home so users can watch one HD channel and record a second; and widely deploying U-verse Voice, an effort begun nearly a year ago in Detroit.

In the last few weeks, AT&T says it has rolled out U-verse TV in Birmingham, Ala., Columbia, S.C., and in Middle Tennessee, Raleigh, N.C., and Orlando, Fla., areas that had been part of the territory of BellSouth, which the U-verse provider had acquired.

The company is still offering a $200 cash-back offer on mid-range and high-end U-verse TV programming packages.

AT&T did not say how widely U-verse services were available in these markets.

AT&T deployed U-verse Voice in Toledo and Dallas/Fort Worth.

And last week, AT&T deployed its fastest Internet service, 18 mbps, to small businesses over its expanding U-verse network in an effort targeting what cablecos believe to be its exposed flank.

So what hasn’t AT&T done with U-verse?

It has yet to say whether it plans to deploy Microsoft Corp. (MSFT) Mediaroom for Xbox IPTV software, which was announced with huge fanfare almost two years ago the 2007 Consumer Electronics Show.

Microsoft has announced BT as a user, one year ago, but not any U.S. based telcos.

And it seems AT&T hasn’t yet implemented Microsoft’s advertising system or Alcatel-Lucent's (ALU) advertising architecture/system. Both vendors have played key roles in the telco’s U-verse creation and deployment.

Both could be on the to-do list for 2009, given parts are still works-in-progress.

AT&T’s satellite situation needs to be sorted out, beyond switching its resale partner as the success, or failure, of its Homezone offering rests in the balance.

And although AT&T CFO Rick Lindner said the telco is hiring in video, broadband and wireless, he said that in a discussion about AT&T’s 12,000 person layoff and 2009 capex cutbacks. Will U-verse be adversely impacted? Stay tuned.

The potentially most interesting areas are situations where U-verse services are integrated for convenience and value-add reasons. Watch for when and how wireless comes closer into play.

Finally, will AT&T go head-to-head with telco TV provider Verizon Communications Inc. (VZ) outside of Texas, where the latter has been overbuilding the former’s network?

Both telco TV providers have their hands full with incumbent cablecos and smaller, more aggressive telcos. Do either have time for more competition?

While none of the above is listed on AT&T’s U-verse timeline, it’s still early.

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