Verizon FIOS in the Sky
It’s a quiet Sunday afternoon. I’m reading an operations management textbook on the porch while my wife is off running errands. It’s a typical Sunday afternoon, until I see a plane carrying out a mission overhead. This mission is directed at a small box located approximately 7 feet from where I am sitting. As the plane circles around the route 128 area near my home, I can’t help but think about the battles being fought over my cable box. Only a few months ago I switched from Comcast to RCN. RCN had mailed me a flyer advertising their much lower priced cable TV service. I looked into it and could not see any reason not to switch. $20 a month cheaper, all the same channels, with the addition of DVR. So I switched. RCN won that battle. Now up in the sky is another company jumping into the fight, Verizon.
At first I find this all a little odd. Here are large companies all fighting to be the provider of my cable television service. They are spending large sums of money, sending sales people door-to-door letting people know FIOS TV is available in the area, paying for aerial advertisements, setting up FIOS kiosks in the mall, visiting local businesses and giving out FIOS basketballs. I also get flyers in the mail almost daily from Verizon, Comcast, and RCN. Meanwhile, I am just looking out to see who is cheaper.
To me it seems they are all in a market where price is the main differentiator and just over the horizon most content will be available through the internet anyway. I know these companies realize this. So, it really makes me wonder why they are so eager to invest in, and enter into, the cable TV market. Shouldn’t they just be focusing on the internet market? It seems to be a no brainer that in 5 to 6 years from now all broadcasts will be through the internet. Customers will soon only require internet access.
Maybe these companies see cable television as a loss leader for future internet subscriptions. Currently television packages can be bundled with internet service. The fight to be my cable provider might actually be their chance to be my internet provider. When television is available through the internet and consumers realize they no longer need a separate TV service, these companies will not care. We will have become their internet service customers. If I’m right, look for your monthly cable bill to drop and the internet service to increase. This way when you drop your cable service most of your monthly payments will be tied up in your internet service anyway.
As a customer it’s hard to tell what the long-term strategy is for these companies. But enough of this, I need to go checkout the prices for Verizon FIOS TV.
