AT&T launches IPTV service, may acquire EchoStar

AT&T has launched its much-anticipated IPTV service to customers in San Antonio. The initial launch includes 200 channels, but the company plans to bolster that figure up to 1,000 or more channels when it expands the service to other markets over the next six months. The carrier's initial offering also includes several hundred VOD movies on HD channels. The company said features like "picture within a picture" and channel surfing will be much faster than with cable TV. As for the hardware, subscribers will receive three set-top boxes with built-in digital video recorders. Doubts about the scalability of the Microsoft software used in the service still circle the Internet since others have had problems getting the DVRs to work in the past. Although the carrier won't disclose subscription fees, it claims they are competitive with those of local cable companies.

AT&T's launch follows on the heels of acquisition rumors that see the carrier buying EchoStar, a satellite company known for their DISH brand. AT&T is trailing Verizon and Sprint on the quadruple/triple play front and an acquisition like this one could be just the ticket. Analysts wonder if mounting debts from previous acquisitions and cannibalization effects from its FTTN deployments and IPTV service would make such a deal unsavory. Then again, AT&T just might have the gall.

For more on AT&T's IPTV plans:
- check out this article from The Wall Street Journal (sub. req.)
- see this Engadget blog entry