Qwest battling cable providers in 6 key markets

PORTLAND, Ore. — With 2.5 million residents in its metro area, Portland is among the frontline battlegrounds in Qwest's fight against intensifying competition from cable companies.

On a recent afternoon, retired bus driver Harold Alt, holding a Qwest advertising flier, inquired about the company's services at one of its cell phone kiosks at the Lloyd Center mall. Behind him was a Comcast kiosk that features the company's recently launched cell phone service — not its cable-TV and high-speed Internet — as the marquee product display.

The wireless service, sold through a joint venture with Sprint Nextel and currently only available in Portland and Boston, is the final piece of a quadruple-play bundle of products that includes cable-TV, Internet and Comcast's fast-growing digital home phone service.

For Alt, 64, the choice was easy.

"I don't like Comcast," he said. "I have a problem with Comcast always raising their rates."

Qwest is doing all it can to hammer that point, and any other perceived weaknesses about cable competitors, into the minds of consumers as it aggressively fights to hold ground in key metropolitan markets.

The company is using TV commercials and direct mail to cable customers. The company's rank-and-file, and top executives, are going door-to-door, occasionally on their own time.

The company shaped its battle plan with lessons learned from its struggles with cable-TV provider Cox Communications in the Omaha market. Cox rolled out its circuit-switched phone service, the same technology used by the Baby Bells, in January 1998. By mid-2004, Qwest conceded that it was no longer the dominant local phone provider in Omaha.

"We have absolutely taken the lessons learned in Omaha and said, 'OK, what do we need to do different?"' said Judy Peppler, Qwest's Oregon president.

Denver-based Qwest is the incumbent local phone service provider in 14 Western and Midwestern states. Much of the company's efforts and marketing dollars, amid the fierce competition, is focused on six densely populated metro areas that analysts say are critical to the company's future.

Along with Portland, the battleground markets are Denver, Minneapolis, Seattle, Phoenix and Salt Lake City. Qwest competes against Cox in Phoenix and Comcast in the others.

In Qwest's territory, Comcast has used Portland as its launching pad for cell phone service, and prior to that, its bundle of cable, high-speed Internet and digital voice service.