Cable Show 2009: Cox VP Maps Out $1 Billion Business Service Road4/01/2009 11:40 AM Eastern
Business services are expected to account for 26% of the revenue growth at Cox Communications over the next two years, reaching $1 billion in total sales by 2010. In an interview at Cable Show '09, Cox Business vice president Phil Meeks laid out a four-point plan to get there.
Meeks, a long-time telco veteran with MCI and AT&T, joined Cox Business about eight months ago. He joined, he said, because of Cox Business' commitment to small enterprise customers.
Cox Communications has offered high-speed data services to business customers for about 16 years, Meeks said, expanding to voice and business video over the last several years. Last year, business revenue grew 16.5% and is on track to grow 15% to 16% this year. By 2010, the company expects business revenue to reach $1 billion.
While the company has recently been able to attack larger enterprises - 100 employees or greater - in the last few years as it has rolled out Ethernet services, Meeks said that the focus is still on small businesses which have been underserved by larger telcos. He estimated that about 80% of Cox Business annual revenue is from small businesses.
With that in mind, Meeks said that Cox is embarking on a four-point plan to further address that market, first by building more intelligence into and expanding its network in four key markets initially - Northern Virginia; San Diego, Calif.; Las Vegas; and Phoenix.
"We are allocating capital in four key growth markets to connect to more commercial opportunities," Meeks said. "These are areas that are adjacent to high growth opportunities."
Meeks added that although Cox has been providing some form of business service to these areas for year, the plan is to expand those offerings and the footprint to potential customers like multi-tenant office parks.
"We're expanding the physical plant to et to more customers," Meeks said. He declined to reveal just how much Cox will spend - they are privately held - but said that business services is "an important part of Cox's overall growth."
Cox Business also will be beefing up its network to attract larger businesses - those with between 20 and 99 employees - by adding advanced capabilities to its hybrid-fiber-coax plant like T-1 services with dedicated bandwidth.
"Companies need a pipe with a committed amount of capacity," Meeks said.
Meeks said that the next step for Cox is to concentrate on upselling its single-product customers to multiple products. And finally, Cox will strive for a healthy mix of retail and wholesale commercial products, focusing especially on cellular backhaul, or providing landline connections between cellular towers for wireless carriers.
Meeks said that Cox believes the opportunity for cellular backhaul is huge, but would not reveal specifics.
"This [backhaul] is a large component of our growth opportunities over the next two years," Meeks said. He added that Cox Business was "in the process" concerning a backhaul deal with a cellular carrier.