More than 300,000 residents from Louisville to Lexington in Kentucky and north into Indiana were left with no cable service for more than nine hours today after an equipment failure at an Insight Communications office on Okolona Road wiped out analog cable.

Louisville cable viewers channel flipping up and down the dial found nothing but frozen pictures, a captured moment in time from 2:53am this morning.  What they found next when calling Insight was nothing but hours of busy signals.  Some customers in southern Indiana found some channels worked fine while others did not.  In all, the outage impacted at least some channels across most of Insight’s service area in Kentuckiana.

Louisville, Kentucky

Insight initially blamed the problem on a router failure that developed during routine overnight maintenance.  A backup router also failed at the same time.  Company officials originally anticipated service would be restored by six this morning, but that did not come to pass.

Because the equipment failure had never been seen before by Insight technicians, it took nearly nine hours to finally resolve the problem.  Local television stations were deluged with calls from viewers wondering what happened to their favorite shows, and Insight’s dropped ball was topic number one on most local talk radio programs today.

Insight subscribers were especially upset that they couldn’t reach the cable company for answers.  Customer service lines were left jammed through much of the day.

Insight spokesman Jason Keller apologized for the outage.

Subscribers either saw this message, or a frozen picture across their channel lineup this morning.

“Everything that we have has a redundancy built into it. This is no different, but unfortunately on this particular morning with this particular piece of equipment, both the main equipment and the backup did not function properly,” Keller said, calling the outage “highly unusual.”

Keller called today’s outage the largest that he has seen during the company’s 10 years of service in Louisville.

By 10:00am, Louisville customers had their HD channels back, with the remaining analog channels restored by 1:30 this afternoon.

Despite the severity of the outage and its widespread impact, Insight Communications is refusing to issue blanket refunds to affected customers.  Instead, individual customers have to call or contact the company and request a refund, which they characterize as an amount under $1.00.

Customers can cost Insight more than that just by availing themselves of that option, and registering their displeasure over today’s long-lasting outage.

Impacted customers can request a refund online or by phone at (502) 357-4400.

Most television newscasts in the Louisville area treated today’s outage as their top news story, with several issuing periodic updates throughout the morning into the afternoon about the service problems.

WAVE-TV in Louisville told viewers “it’s not our fault” that Insight subscribers couldn’t watch the station for at least nine hours today.  (2 minutes)

WLKY-TV in Louisville said it received tons of calls from concerned viewers, one of whom was upset that the company “doesn’t want to give customers answers.”  (2 minutes)

WHAS-TV, also in Louisville spent time outside of WHAS Radio’s studios this afternoon covering angry reactions from Insight customers on local talk radio.  (2 minutes)

WHAS followed up its earlier report with a wrap-up during its early evening newscast explaining what caused the nine hour outage.  (3 minutes)

WDRB-TV in Louisville explained to its viewers how they could get their money back for a day’s worth of frozen pictures.  (2 minutes)

AT&T unveiled its U-verse service Monday in Louisville, in a ribbon-cutting ceremony with claims that residents “finally have a choice” for cable service in the area.

AT&T will compete head-on with incumbent cable operator Insight Communications, which has been the only cable provider in Jefferson County for at least a decade.

AT&T promises customers packages starting at $49 a month, as well as digital video recorder set top boxes that can record up to four shows at the same time, and display the recorded programming on any AT&T-wired television in the house.  AT&T also promises residents significant savings when they choose AT&T for video, telephone, and broadband service, and will even include a “quad-play” bundle including AT&T Wireless mobile phone service, resulting in one bill for all AT&T services.

AT&T’s U-verse system is an advanced form of DSL, using a hybrid network of fiber optic cables wired into neighborhoods that interface with ordinary copper telephone wiring that already exists in most Louisville homes.  The technology reduces the costs of wiring every home with fiber optics, but can still offer advanced services “beyond what cable can offer,” according to AT&T.

Consumers across Louisville welcomed the competition.

Tabitha Rhodes told the Louisville Courier-Journal the lack of competition was bothersome.  “It is like there is only one shoe store in town,” she said. “I want 20 shoe stores.”

Rhodes’ husband, Tate, said he hopes AT&T’s competition will force Insight to become a more reliable cable company. Rhodes said their cable service has experienced dropped channels, poor quality pictures, and even pesky neighborhood squirrels that gnawed through the cable line serving his street.

The U-verse service also ties in with an Apple iPhone application, which when run on AT&T’s wireless network allows customers to program their television recording remotely.

Insight customer Rhonda Petr, 44, said she now pays $15 per month for digital video recorder service for each of two television sets in her home, in addition to a bundled monthly subscription for premium cable, phone and Internet service.

Petr said she liked the idea of DVR service without “nickel and dime” charges for each TV set.

Insight Communications dismissed AT&T’s U-verse as little more than smoke and mirrors, according to company spokesman Jason Keller.

“Insight has been Louisville’s technology leader for more than a decade,” company spokesman Jason Keller said Friday.

“One more competitor… won’t change that,” Keller said.

Insight’s system in Louisville is the largest in the company’s nationwide portfolio.  Company officials point to investments Insight has made in the Louisville area to introduce additional services, including “a broadband service that is faster than what AT&T is offering.”

Insight offers 20Mbps service for $17 less than what AT&T charges for 18Mbps, according to one reader.

Insight claims that AT&T is relying on the same old wiring that has been around “since the days of Alexander Graham Bell” to deliver service, and Insight has a “technological advantage in broadband width.”

The question on everyone’s mind is, how much will consumers save?

As the Courier-Journal notes, both are primarily competing on services, not on price:

Both Insight and AT&T offer bundled packages combining telephone, television and Internet starting at about $100 per month.The two compete chiefly on features. For instance, Insight offers faster Internet access, while AT&T is promoting U-Verse’s features that link television, home phone service, wireless phone service, and Internet together.

Rob Enderle, a technology consultant and president of the Enderle Group based in San Jose, Calif., told the newspaper the big savings are found in new customer promotional offers, which he calls “low teaser rates.”  In many Verizon FiOS TV areas that compete with cable, promotional new customer offers also often include long-term contracts lasting 12-24 months.

Incumbent cable companies often launch pre-emptive marketing blitzes to sell their customers on “price protection agreements” just before a competitor comes to town.

“They will try to lock up as many customers as they can,” Enderle told the newspaper.

In Louisville, Insight may have managed to accomplish that with their one-year “price protection agreement” they have managed to sell many of their customers.  The marketing for such agreements promises no price increases for the term of the contract, something that might sound attractive to price-sensitive cable subscribers facing relentless annual rate hikes.

AT&T has no such contract requirements in Louisville, although the company has used them in other markets to lock in customers taking advantage of promotional offers.

Once those promotional offers expire, the two companies will end up charging roughly the same prices for the various packages they offer.  Customers can choose which provider gives them the channels and services they want, as well as which offers better quality service.  The elusive savings, once the promotions expire, are still hard to find.

One Louisville reader called both companies to compare:

Just did a comparison on the different packages AT&T would offer: slower Internet, any additional DVR boxes would be $15/mo (same as Insight), HD channels would be $10/mo (free with Insight), and they would offer no more channels than Insight and both offer garbage as far as programs go. Yeah, I think Insight needs some competition in order to provide its customers with better pricing and better quality, but slower Internet and having to pay to access HD channels is BS. AT&T better come up with something better.

Multiple video news reports about AT&T’s U-verse launch in Louisville can be found below the jump.  Many also include product introductions and short demos.

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