By Mavis Scanlon Ted Rogers, CEO of Canadian MSO Rogers, struck a chord at the Western Show when he warned that cable operators would have to differentiate their IP telephony service from similar services offered by incumbent phone companies. Well, Ted, Mark Dzuban and the team at Cedar Point Communications were listening. Cedar Point, which was founded specifically to address the VoIP telephony needs of cable operators, already has a few ideas and products to help set them apart. Dzuban, the vice chairman of Cedar Point and a recognized expert in the field, says voice communication is not just a service, it’s a form of human bonding that allows one person to immediately know whether the person on the other end is OK or in distress. Multimedia features will take the medium to the next level. At the Western Show, Cedar Point displayed a VoIP videophone prototype unit manufactured by InnoMedia. Dzuban predicts that, with falling prices for terminal and consumer gear, roughly 15% to 20% of cable telephony customers will have a videophone in the next five years. More efficient management of bandwidth on the part of MSOs will also help the take rate. Although the industry has some 3 million circuit-switched telephony customers, virtually all the top MSOs are now looking to more rapidly deploy the VoIP telephony product. Oppenheimer analyst Tom Eagan estimates VoIP subscribers will grow from about 100,000 at the end of this year to 600,000 next year, and 2.3 million by year-end 2005. That’s an awful lot of connections—and the reason why having a scalable service is crucial for the industry. Comcast is Cedar Point’s largest customer, as well as an investor in the company through Comcast Interactive Capital, and plans to use Cedar Point equipment in three of four telephony deployments next year. Charter, Insight and Net2Phone are also customers. A major coup for Cedar Point would be to wrest a Time Warner Cable market away from entrenched TWC vendor Cisco Systems, which won’t give it up without a fight.

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Increased online shopping should actually help the industry, particularly all these DTC streaming offerings.

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