Cable Operators

Dangling Digital Carrots

7/27/2010 9:22 AM Eastern

For Comcast’s system in
Augusta, Ga., it paid off to accentuate
the positive during its
recent conversion to all-digital
television.

While you’re losing analog TV,
the cable company told customers,
you’re gaining a bunch of new
digital channels for free — not to
mention one of the fastest Internet
services in the U.S.

“The most important thing
was to emphasize all the benefits
to customers” of converting the
system to 100% digital TV, said
Tina Baggott, Comcast Augusta’s
director of marketing. “We were
able to demonstrate the functionality
of what you get with digital
service.”

The 90,000-subscriber system
is the MSO’s first — and so far
only — to go 100% digital.

Abu Khan, vice president and
general manager of Comcast Augusta,
said his team decided at
end of 2008 to pull the analog
plug. Two factors made it an easy
decision, according to Khan: It
already had a high digital cable
penetration, of around 95%, and
as a 550-Megahertz system it was
fairly constrained.

“We were pretty locked,” he said.
The system’s goal for 2009 was
to migrate as many customers
as possible to digital services. In
September 2009, Comcast Augusta
shut off 24 analog channels
in the expanded basic tier. Then,
in March 2010, the last 16 analog
channels in the “B1” broadcast-basic
tier were retired.

The Motorola-based system
distributed two or three digital
terminal adapters to customers
who needed them, supplied
mainly by Motorola as well as
Technicolor (formerly Thomson)
and Pace. The DTAs, smaller and
cheaper than conventional set-top
boxes, provide decryption for
the expanded basic tier.

An incentive for customers to
install the DTAs was that Comcast
Augusta added 11 “sidecar” digital
services from local broadcasters to
the B1 lineup.

“We positioned it as, ‘We’re giving
you some free equipment, and
you’re going to get all these additional
channels,’ ” Baggott said.

Meanwhile, separating the
shutoff of the expanded-basic
analog tier and B1 basic by six
months made it easier for Comcast
Augusta to manage customer-service issues that came up
“versus being bum-rushed all at
once,” Khan said.

After freeing up roughly 200
MHz, Comcast Augusta now offers
a suite of products that rivals
any other cable system in
the country. It offers 100 HD
channels, compared with 34 before
the digital conversion; has
deployed DOCSIS 3.0 and offers
a 100-Megabit-per-second Internet
tier; and offers 20,000 videoon-
demand selections.

The analog-reclamation project
also cleared space to let the
system offer customers the 3D
telecast of the world-renowned
sporting event in its backyard —
The Masters golf tournament —
this April. In addition, Comcast
Augusta is rolling out a Hispanic
programming package.

“Obviously we’re trying to use
the space as smartly as we can,”
Khan said. “We’re happy with
where we are right now.”

Success factors for Comcast Augusta:
Take a gradual, phased approach: The system eliminated 24
expanded basic analog channels in September 2009, and cut off
the 16 “B1” lifeline tier in March 2010.

Communicate with customers extensively: Comcast Augusta
used direct mail, automated phone calls and community events
to spread the word.

Provide free digital equipment: Digital subscribers were eligible
for one free digital set-top and two DTAs; limited-basic subs
could get up to three DTAs.

SOURCE: Multichannel News research

October