Are Comcast and Time Warner scaring the competition yet?

Comcast and Time Warner didn't say too much about their WiMAX offerings, which they resell from Clearwire, in their fourth-quarter earnings, but what they did say may be a foreshadow of of the type of competition Verizon and AT&T might see in many major markets.

Comcast said it is already seeing significant momentum from its mobile WiMAX offering in Portland, a market the cable giant launched last July. The company sells its High-Speed 2go WiMAX offering bundled with its high-speed data fixed products in five major markets now, but Portland was the first.

"We've proven in Portland that Comcast High-Speed 2go bundled with our high-speed data product is a way to increase our high-speed data business," Stephen Burke, chief operating officer and executive vice president, said during the company's fourth-quarter conference call with analysts, according to transcripts from Seeking Alpha. "In Portland, roughly 40 percent of the High-Speed 2go customers are new high-speed Internet customers for Comcast."

Time Warner, which is behind Comcast in rolling out WiMAX, told analysts last week that the company was off to a good start with its Roadrunner Mobile product.

"As our product launched in Dallas and parts of the Carolinas in December we have added more than 1,000 subs, and in recent weeks we have launched the service in San Antonio and Hawaii," said Landel Hobbs, COO with Time Warner. "As you would expect, most of our Roadrunner Mobile subs were existing Time Warner Cable customers. So far around two-thirds have taken the unlimited 4G service and most of the rest have taken the nationwide 4G/3G plan. We are encouraged that almost 20 percent of new wireless customers also added one or more additional Time Warner Cable products."

Comcast is a bit more aggressive with its pricing than Time Warner. Comcast charges $50 a month on an introductory basis that includes home Internet service at 12 Mbps and a free WiFi router. After the first year, the price increases to $73 per month. For an extra $20, customers can add nationwide 3G data service from Sprint Nextel to the package.

Time Warner's pricing includes $40 per month (if a customer takes another Time Warner product) for light users with a 2MB cap, $50 for unlimited WiMAX with another Time Warner product and $80 per month for unlimited 4G/3G service for customers who also use either Time Warner's Road Runner Standard or Turbo cable modem offerings.

Meanwhile, competitors AT&T and Verizon aren't bundling 3G and fixed broadband nor are they bringing down pricing to match Comcast's in the markets where it competes with WiMAX. That could change as Comcast and Time Warner invade more markets where Verizon and AT&T are battling it out for high-speed, video and voice users.

Comcast, by the way, had a banner fourth quarter, posting earnings of $955 million, up from $412 million a year ago when, ironically, earnings fell 32 percent because of a $600 million write-down related to its investment in Clearwire.

Both Comcast and Time Warner have aggressive plans to expand WiMAX in 2010. Burke said Comcast plans to significantly expand wireless High-Speed 2go into new markets as well as attack the enterprise segment. "We are now building on our strong momentum in business services to expand the customers we target and our offerings in that space," Burke told analysts.

Time Warner also said this week that its Road Runner Mobile offering will appear in a "sizable fraction of our footprint in 2010. As a result we expect a pretty substantial expenses especially related to marketing and device activation. We are willing to make a significant investment at the start of the year because we believe that wireless broadband could become a meaningful part of our business down the road," Hobbs said.

With Clearwire flush with new funding, new markets are expected to come on quickly to meet the expectations of its cable partners. Will these cable operators make a significant impact in 2010 to make Verizon and AT&T take notice? --Lynnette

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