Why AT&T needs IPTV more than Cable needs Telephony

Interesting analysis over at the AT&T "Weblog" (didn't know anyone still used that term):

We know why AT&T and Time Warner want to get into each other's business. They've both are counting on the idea that consumers want bundles, right? ...But who stands to gain the most by adding that new component to its bundle? ...I bet it's AT&T. ...the landline phone business is going away. Look at what's happening to AT&T's revenues as people switch off their home phones for wireless and e-mail. Look what's happened to long-distance rates... ...U-verse has the potential to bring AT&T into the entertainment business, which is growing and has expansion potential yet to come. Even if competition from cable companies makes AT&T cut subscription prices, the company's IP-based system theoretically gives it an open-ended ability to roll out — and charge for — new services including music, games and plenty that's still being dreamed up... But, before we start slapping Big Ed on the back in congratulations, we've got to remember something: AT&T has got to execute before it can reap those rewards...

Looking back on Ed's track record of innovation, I don't think the cable companies are all that worried.

AT&T Blog: Why AT&T needs U-verse more than the cable guys needs phone