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AT&T absorbs @Home customers smoothly, readers say

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Ma Cable appears to be showing @Home just how little it needs a service contract by switching recently-disconnected customers to their own broadband pipes smoothly and swiftly, according to anecdotal reports from the consumer front.

Readers tell us that AT&T is committed to having all former @Home subscribers switched in ten days' time, and appears actually to be on schedule. Indeed, in parts of the West Coast @Home subscribers got switched without even realizing it over the weekend.

"Of all of [@Home's] cable buddies AT&T was the most capable of building their own network and of building it quickly. I was off on Friday night and back on Sunday morning," one reader reports. "Personally I'm quite happy to be on AT&T and not on one of the other cable providers who would be forced to give in to Excite@Home."

A Texas subscriber tells us that the "Dallas area had a 2-day outage resulting from this, but we were all back on-line Sunday evening. Alas, the download rate has now been limited to 1.5Mbps (per official memo, and I've verified this experimentally). Gone are those glorious 5Mbps rates I was getting just last week...."

From the Bay area we hear that "Customers in San Francisco and Illinois are scheduled to move this Monday and Tuesday. Customers in Denver, Colorado and Salt Lake City, Utah are scheduled for Wednesday. Customers in Hartford, Connecticut; Pittsburgh, Pennsylvania; Sacramento, California and the Majority of the Rocky Mountain region are scheduled to move on Thursday. Customers in Michigan will be moved on Friday. And they're on schedule as of Tuesday AM."

It hasn't been all sweet talk, though positive memos outnumber rants by about six to one. Of course we have to point out that our sample is weighted heavily towards those who have in fact got back up quickly. We've yet to hear from those still "power-cycling the cable modem regularly looking for carrier, much like a trained rat pressing a lever for a food pellet that never comes," as one reader so aptly puts it.

One of our correspondents sees the outage as a perfect opportunity to stuff cable altogether. "I got DSL in August so I could run my business from home; @Home forbids running servers of any kind, unless you pay an exorbitant fee for their @Work service ($250 setup, $250/month, and you get a whopping 256k upstream - which I get with DSL for less than $100/month). I had kept the @Home service because newsgroup coverage was excellent."

"Well, the news service degraded horribly over the past month, and the outage on Friday was the final straw. I have instructed my bank to refuse any further payments to AT&T, and I've told AT&T what they can do with their cable modem."

Meanwhile, Reuters reports that Comcast is making increasingly generous offers to acquire AT&T Cable, and quotes the Wall Street Journal's speculation that Microsoft "has offered to back Cox and Comcast's proposals in order to stifle rival AOL Time Warner's bid" for the company. With a suga daddy like that in the background, anything's possible, we reckon -- but a bidding war in this economy?

Still, if AOL were to buy AT&T cable, it would be a significant blow to all the rest. Sweetening the pot within reason to keep it out of their hands does make sense.

Additionally, a reader reports that his Philadelphia NBC news affiliate "announced that Comcast and Excite@Home reached an agreement, where Comcast will pay Excite@Home $160 million for three months' service, after which Comcast will have switched their customers to their own network."

We've also learned that Cox will cough up $160 million as well, and smaller partners collectively another $35 million for a total of $355 million to keep the company afloat for the next three months.

That seems a sensible approach, following AT&T's lead. Vacuum up as many of @Home's customers as possible and then buy the carcass dirt cheap. It works so long as all the remaining suitors can expand their networks in proportion to @Home's attenuation, which of course remains to be seen. ®

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