Phone companies: “we’re not phone companies, we’re communications and entertainment companies”.

The Economist this week publishes a good report about convergence. It starts with:

“WE’RE not a telephone company anymore; I sort of resent that,” says Lea Ann Champion, an executive at SBC, America’s second-largest “Baby Bell”. “We’re a communications and entertainment company.”

Phone companies are under attack for traditional call based revenue and they are chasing content plays as a means of replacing this. Just look at the content deals done here in Australia in recent months. Then consider the Telstra acquisition of Trading Post.

While The Economist report focuses more on the threats to the phone companies, it provides a good perspective of the IPTV opportunity in their business plan.