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SR at forefront of TV tech

Winner in 'battle of bundles' could be customer as Comcast, AT&T offer next-generation services, deals

Published: Sunday, January 20, 2008 at 3:33 a.m.
Last Modified: Sunday, January 20, 2008 at 3:33 a.m.

When it came to TV service, Santa Rosa was the armpit of the Bay Area for nearly a decade.

The city's outdated cable system meant residents paid the same as people in other cities, but received a lower quality picture, fewer channels and lacked some popular features, such as video-on-demand.

But those days are almost over. Santa Rosa has been thrust to the forefront of digital technology.

Comcast and AT&T have started delivering their next-generation services in some neighborhoods, and are adding new ones every week.

Residents of the county's biggest city will have the option to customize news, weather and stocks that scroll across their screens. They can use their office computer to record a baseball game on their living room TVs for later viewing. Or they can watch a rerun of "American Idol," stored at home on their set-top box, while vacationing in Mexico.

These futuristic technologies are being offered in Santa Rosa in the midst of a battle between AT&T and Comcast to deliver phone, Internet and TV service to customers. Watchful residents will find they can get a lot more for less money.

"It puts Santa Rosa in the top 5 percent of the nation in terms of competition and technology," said Vince Vittore, an analyst with Boston-based The Yankee Group.

What does that mean for consumers?

Comcast is giving away loads of discount offers, such as free HBO, to keep customers from switching.

AT&T, which slowly began rolling out its U-verse service in Santa Rosa last summer, is currently offering new customers free installation and $100 cash back plus the first month of service free.

People willing to try AT&T's U-verse system will get a first look at the future of television service, which is more customizable than yesterday's technology.

Those who stick with Comcast will be able to get Internet speeds so blazing fast a person could download a full-size DVD in less than a minute, more than 30 times faster than its antiquated network.

AT&T, the nation's largest telephone company, has sales people going door to door in neighborhoods were U-verse is available. Comcast, the nation's largest cable company, plans to counter with its own door-to-door sales blitz in the future, and is sending brochures with lucrative offers to those who have switched to U-verse.

Both companies are trying to attract customers by bundling a slew of services. Comcast pushes its Triple Play service, which costs $99 and includes digital cable, Internet and telephone service. AT&T bundles television service and DSL Internet service, starting at $59.

"We call it the battle of the bundles," said Steve Rago, a principal analyst with iSuppli, which monitors the industry. "The idea is that if you can provide the consumer with all of their communications needs, then they tend not to switch to another provider."

The stakes are high.

Telephone companies have been losing about 4 percent of their customers a year, Rago said. Many customers switched their phone service to the cable company. Now the telephone companies are ready to poach cable TV customers by offering television service.

"It's a major turf war," Rago said.

You can reach Staff Writer Nathan Halverson at 521-5494 or nathan.halverson@pressdemocrat.com.

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