SAN ANTONIO, TEXAS: America's largest telco AT&T reports that initial customer response to its internet-based internet protocol TV service (IPTV), launched last month, is "extremely positive."

The telecoms giant, which is pioneering IPTV delivery in the US as an alternative to cable TV, is targeting 620,000 homes in phase one of the project's rollout in its home town of San Antonio. The service is built around a new fibre optic network dubbed Project Lightspeed.

The company expects to sign-up 10% of its target audience by the end of this month and is on course to roll out commercial services - including high definition TV - in fifteen to twenty US markets by the end of this year.