New Cable Initiatives Target Enterprise Market
ATLANTA - Cable executives see explosive growth in sales to businesses in a largely new area whose challenges included increased complexity, higher customer expectations and more spending. Cable officials told a Cable Telecom Assn. for Mktg. conference here cable firms are at a variety of stages in selling products, especially voice and broadband, to other companies. Based on their comments, Cox seems to have had the most experience, followed by Time Warner, Cablevision and Cable One.
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“The next big thing isn’t some killer [application] that hasn’t been developed,” said Cox Vp Gary McCollum: “Business service is the next big thing.” Cox Business Services helped McCollum’s northern Va. system become the firm’s top performing property last year, he said, though he declined to provide dollar figures. Commercial services is only about a $1 million business for Cable One, engineer Rick Bechtel said: “We are primarily a cable business that is just entering into the commercial fray.” Consultants we spoke with couldn’t peg the potential size of the national market. Cable systems are forecast to pass half of U.S. firms by year end, said Kagan analyst Ian Olgeirson after the panel.
Challenges included educating Cox employees on how to deal with firms, tweaking sales methods and tying compensation to commercial growth, McCollum said: “It can’t be seen as just another hobby.” Meeting local franchise requirements can be a hurdle for an effort that takes “a lot of capital,” Bechtel said: “We have to build the fiber to each one of these locations.”
Meeting company expectations can be more difficult than with residential subscribers, said John Guran, vp-commercial services for Time Warner in northeast O. Installation can take 45 days to 9 months, far longer than for homes, he said: “That’s a new kind of dialogue that we have to manage.” TW tries to give firms plenty of notice before performing system maintenance, said Guran. “It takes longer to establish relationships,” he added, but that has a payoff: “It’s like dating… Once they make a decision to go with you, they're less likely to churn.”
Upsides include cable’s competitive advantages over telcos, said the 4 speakers. Cablevision’s 30-Mbps broadband service is faster than Verizon’s FiOS data offering, said Vp Jill Wagner. Cable operators have an upper hand since they face less regulation than telcos to work with peers, Guran said: “The cable industry can do that without regulatory approval or tariffs… We have a tremendous advantage.” A Verizon spokeswoman disagreed: “That simply isn’t true… Our 30/5 Mbps FiOS service has more than twice the upload speed that Cablevision claims for its 30/2 Boost service.”