VoIP: Cablevision versus VZ

USA Today details the Voice battle between Cablevision in NY and VZ:

One of cable's biggest VoIP success stories is Cablevision. The New York-based operator started offering "Optimum Voice" in November 2003. Today, it claims 1.1 million phone customers, and continues to add them at a rapid clip. That's impressive: Cablevision only has 3.1 million cable subscribers — far fewer than Time-Warner, with 14 million, and Comcast, with 24 million. That means one out of three Cablevision customers has added Optimum-branded VoIP. The bulk of the buyers are coming out of the hide of Verizon, the dominant local phone company in Cablevision's service area. The secret of Cablevision's success? "Our product has everything the traditional phone product does, plus features it can't offer," according to Tom Rutledge, chief operating officer. Among other things, he notes, Optimum customers can check voice mail on the Web, program home phones with different rings for different callers and monitor call histories. Customers also get unlimited local and long-distance calling and 911 services. Optimum-branded phone costs $14.95 a month if customers also buy Cablevision's cable TV and high-speed Internet service. (Speed: A super-fast 15 megabits-per-second downstream and 2 megabits upstream.) Total package cost: $90 a month for the first 12 months for new customers and $115 a month thereafter. For another $19.95 a month, Cablevision will throw in 250 global calling minutes. Even with these strings, Rutledge says, "You add it all up, and it's a really good value proposition."

Verizon spokesman Eric Rabe counters that there is no mystery in Cablevisions success with VoIP. It has "been essentially giving away (VoIP) service. … So it's a price play, pure and simple." Rabe also says Cablevision's VoIP service is nothing special. "The features Mr. Rutledge describes are common with voice over IP services," he says. That includes "Voice Wing," which is Verizon's VoIP product. Moreover, Rabe says, Verizon can provide many of the same services on the traditional phone, as well. "What competitors don't offer is Verizon's unequaled 99.999% reliability and … customer service," Rabe says, alluding to the Bell's heritage.