Cable Show 2011: Cablevision's Bickham: Cable Can Recapture Satellite TV Share


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There's no reason the cable industry cannot reclaim the approximately 30% share of the pay-TV business it lost to DirecTV and Dish Network, Cablevision Systems president of cable and communications John Bickham said on a panel of MSO operations executives here Thursday.

"Satellite penetration at 30% is I think unnatural and unsustainable," Bickham said. "It's a one-way network. It has no tricks I know of that we can't do twice as well."

The panel, "Across the Universe: Top Cable Executives Talk Products, Competitors, Service and Strategy," was moderated by One Touch Intelligence analyst Matt Stump.

Cablevision president John Bickham

Bickham also noted that 50% of new broadband customers are taking the operator's recently introduced 50 Megabit per second tier. "I don't think there's any question that cable has the best delivery mechanism for video and data," he said.

The key to competing against the more formidable telcos is to relentlessly focus on customer satisfaction, Bickham said.

"In this business, your reputation precedes you. And in a competitive environment, there's nothing more important than your reputation," he said. "Verizon sells almost every product that we sell. AT&T sells most of what we sell. The difference in the marketplace is how well you execute."

Carol Hevey, executive vice president of Time Warner Cable's East Region, echoed that point. "We're in the customer relationship business. Our competitors, whether they're AT&T or Verizon... we have essentially the same products and similar pricing. So the way to differentiate ourselves is to make the customer feel good about choosing us."

Added Cox Communications chief operating officer Leo Brennan, "You have to be thinking about retention from day one."

For Suddenlink Communications, the way to differentiate the service isn't by saying "they have only five of these and we have 10," but to make the company easy for customers to engage, executive vice president and COO Tom McMillin said. "We make it pretty darn easy on our customers to do business with us," he said.

John Pascarelli, Mediacom Communications executive vice president of operations, agreed that simplicity is key, but he added, "There's no magic bullet. The biggest thing is the bundle. Video-only customers, they churn out... With the double play and triple play it's a totally different animal."

Brennan addressed the commercial services opportunity, pegging the market at $6.5 billion in Cox's footprint. Wireless phone and data services for business customers is another $4 billion opportunity on top of that, he said. In 2010, Cox topped $1 billion in commercial services revenue.

"It's just been a great business," Brennan said. "Our focus has been small and medium-size companies, that's our sweet spot -- 80% of our revenues are in that space."

Cox is offering its "Unbelievably Fair" wireless in a wholesale agreement with Sprint and expects to launch the service in 50% of its footprint by year-end.

Time Warner Cable, meanwhile, is an investor in Clearwire (with Comcast and Bright House Networks) and offers 4G WiMax service to its subscribers. "The voice market is so saturated we felt wireless data was a better entry point," Hevey said.

Cablevision is pursuing a different strategy altogether, building out Wi-Fi access points across its service areas and offering that to Optimum Online subscribers for now extra charge. "We've spent a lot of time educating customers about the wireless network. It's fast. It's free. Our strategy has been to extend the wireless experience outside the home," Bickham said.