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consumers a better alternative to cable companies through unmatched services, competitive pricing, and a complete quad-play bundle with wireless.”

And does Elak consider over-the-top and content providers a major threat to Verizon? “Not really – our advanced networks, particularly FiOS with it’s incredible capacity for data, is what content providers need to deliver their product to the market,” said Elak. “Verizon enhances the content experience for consumers because of our network.”

However, despite any preparation, flexibility, or confidence shown by service providers, over-the-top providers still manage to chip away at the distribution and advertising revenue of telcos and cablecos. While Vonage and other over-the-top voice services have been covered in detail in Pipeline, video providers like Hulu haven't gotten a lot of mention in our pages. However, as they are distributing video contact directly into the homes of millions, directly supported by ad revenue, and completely side-stepping the traditional television structure, they certainly bear mentioning.

Whereas the impact of YouTube, which still owns the lion's share of online video viewership, is limited by the length (10 minutes) and origin (generally homemade, which is tons of fun, but hardly disruptive) of its content, Hulu delivers first-run television programming and a relatively large volume of movies for free. In addition, most major networks stream programming directly from their websites (I almost always catch Lost on abc.com), and experiments like the CW's dropping of Gossip Girl from its online streaming content in an attempt to lure viewers to the live broadcasts have been utterly ineffective, and have saddled networks who take such measures with the image of being Luddite techno-phobes. (In case of Gossip Girl, the CW restored online streaming after less than 3 months after loud viewer complaints and no real rise in live viewing).

Streaming from Hulu, network sites, and other sources like AOL Television, are tempting for advertisers, too, as viewers can't fast forward through commercials like they can on DVRs.

In addition, companies like Netflix offer unlimited streaming plans of a huge variety of new movies and TV programs for extremely low-cost. Throw in the convenience of Netflix-compatible set-top boxes like those offered by Roku and you have a situation in which, for many, traditional television service is unnecessary, regardless of the access technology over which it is delivered. It's

But what will the landscape look like as younger viewers get older and are less and less willing to arrange their schedule around live TV? It's an issue. It will be interesting to see how cablecos, telcos, programming networks, over-the-top providers, and other affected parties deal with the changing needs of consumers and the changing demands on providers.

In Short:
With cablecos resolving, at long last, to chip away at the telcos' enterprise market share, cablecos demonstrate a potential edge, going forward. Will that be enough? Will DOCSIS 3.0 be able to help cablecos, in spite of it's large price tag to the end consumer? It's a tough economic environment for the rollout of a service that costs more than many pay for their entire triple-play bundle.

In the end, cablecos and telcos will continue to hammer each other, expanding bandwidth and adjusting cost along the way. Meanwhile, content is king. People in the communications space are always looking for the next “killer app”. The real differentiator is content. How will cablecos and telcos, alike, confront the changing expectations of viewers and the increasing levels of competition? By figuring out ways of delivering content at a price-point, level of quality, and level of convenience that viewers have come to expect.