The business world has been turned upside down (and shaken!) several times since the technology boom period at the end of the 1990's. We've seen ideas some and go, we've seen revolutionary new ideas fade away and be replaced with others, and we've also seen ideas that seemed crazy one year become commonplace the next. One of the more traditional businesses thats under pressure at the moment, is that of the ubiquitous cable company. These businesses are under pressure from Internet companies offering bundled TV and Internet connection services. Netflix and similar providers have revolutionized how many people watch television and people are questioning the high price of cable television. The mobile carriers are getting in on the act, too, by offering high-speed fiber optic home broadband bundled with media services to steal customers from the old guard. However, the long-standing cable TV businesses are fighting back such as Cablevision System Corp, which today announced it is to launch a new wireless Internet phone service in February to compete with more expensive data plans from traditional cell phone networks.
The new service is to be called "Freewheel" and will run over any WiFi connection, but it'll only run over WiFi. There's no cellular connection, not even as an option. Cablevision are seeking to capture the imagination of customers wanting unlimited amounts of data on their smartphone using WiFi, which is less expensive than a cellular modem connection. It's an about-face way of working a mobile network, where traditional carriers have used WiFi to boost a cell connection and to help control data costs. Freewheel will cost just $9.95 per month for customers who already are Cablevision's subscribers, which will cover unlimited talk, text and data. For customers not using Cablevision the price goes up to $29.95 a month. The service will launch using the Motorola Moto G, which is discounted down to $99.95 to those existing customers. The Moto G will come with Cablevision applications that automatically registered the device with the company's WiFi hotspots.
Of these hotspots, Cablevision has rolled out its own Optimum WiFi network, which was started in 2007 and now has over 1.1 million locations in the New York Tri-State area. The service works by allowing customers to share part of their bandwidth in exchange for being able to share other peoples' bandwidth. There are also another 300,000 hotspots across North America courtesy of the CableWiFi initiative that combines Comcast, Cox and Time Warner Cable, not to mention the freely available WiFi at your local Starbucks et al.
If this sounds familiar to our British readers, it's because it's not so distant from BT's own mobile carrier plans, but with one crucial difference: Cablevision has no cellular fallback (whereas BT had made plans to use EE's network before it then announced it wanted to buy EE). Because there's no fallback cell connection, Cablevision's service won't be great for commuters who frequently stray away from WiFi coverage. But then it isn't designed for these sorts of customers.
I can't help but feel that Cablevision have dropped the gauntlet at the carriers' feet. Offering their own mobile service, admittedly leveraging their own significant WiFi hotspot infrastructure, but at the price of about a coffee a week for unlimited use - that's a gutsy move. The risks to Cablevision are minimal, but this service could start to steal significant numbers of customers from the established cellular businesses in short order. What do our readers think? If you live in the New York city area, let us know if you would consider this service? Or do you feel Cablevision's plans are too little, too late?