MediaOnes Broadband Push Paid Off

Author:
Publish date:
Updated on

MediaOne Group Inc.'s aggressive "broadband"
branding push over the past two years made an impression that may linger even if the
MediaOne name itself disappears, industry analysts said.

MediaOne replaced the Continental Cablevision Inc. brand in
May 1997, following U S West Media Group's purchase of Continental the year before.

Upon launching the new brand, the company committed to
spending $20 million on marketing it in 1997 alone. Along with the new name, MediaOne
pushed the tag line, "This is broadband. This is the way."

Analysts credited MediaOne with calling consumer attention
to the word broadband -- a word that has come to signify that cable has more to offer than
just video.

The potential for cable-telephony and multimedia services
over high-speed-data connections is what drew the likes of AT&T Corp., Microsoft Corp.
and Microsoft cofounder Paul Allen to cable, and those nonvideo services are a big part of
why companies like MediaOne can command premium sale prices.

But while strategic investors appreciate broadband, the
jury is still out on whether consumers really get it.

Howard Horowitz, president of Larchmont, N.Y.-based
Horowitz & Associates Inc., said there are two schools of thought on what broadband
should evoke -- whether it's strictly the big-pipe delivery mechanism, or all of the
content that can go along with it.

"Consumers don't understand what broadband is,"
said Victoria Barkan, a principal with The Brand Consultancy in Norcross, Ga. "If
you've got plenty of money, you can educate them, but operators would be better off
spending the money on customer service."

Although instituting a new concept like broadband doesn't
happen overnight, some analysts believe that marketing it too early can backfire if a
company isn't ready to back the slogan with a full range of broadband services.

The term broadband creates consumer expectations that can't
always be met in every cable system. While MediaOne offers high-speed Internet access in
some markets, for example, it isn't available everywhere yet.

And in markets where newer services aren't available yet,
analysts said, some subscribers are starting to see the promise of broadband as just one
more excuse to raise cable rates.

Horowitz believes that the term broadband will gain more
meaning as Internet, telephony and cable services are bundled together. He added that the
industry may need a common term encompassing all of those services in order to help market
bundled packages more readily.

When asked whether there were other terms that could convey
the same message, Horowitz suggested that "convergence" might be such a term,
but he added that broadband was probably more consumer-friendly.

The cable industry "has a ways to go before it's
communicating broadband in a way that resonates with consumers," said Mark Greenberg,
president and chief operating officer for Austin, Texas-based Prime One, which competes
against both Comcast Corp. and MediaOne with its digital-wireless-cable service in Los
Angeles.

Although Comcast and MediaOne haven't said what will happen
to the MediaOne brand -- or the broadband tag -- following the deal's close, analysts
believe that it's a given that Comcast will drop the MediaOne name.

But that's not to say that the time, money and effort spent
on the MediaOne brand was misdirected.

"I don't think that it ever hurts to build your brand
name, even if you end up changing it," said Barbara Sullivan, president of
Denver-based B.G. Marketing Inc. "Going in with a positive brand equity helps,"
and that can carry over to the new brand, she added.

Comcast might face some challenges with consumer perception
among MediaOne subscribers, said Glen Friedman, president of Los Angeles-based Ideas and
Solutions Inc., if they start to wonder, "Didn't we just change" cable companies
recently?

"Comcast will have to communicate the rich history
that it brings and the idea that it's going to be around for a while," Friedman said.
This means that Comcast will need to be at least as aggressive as MediaOne was in putting
its name in front of subscribers.

Some analysts said MediaOne's aggressive branding push may
have even pumped up the value of the company to a buyer such as Comcast.

While that's possible, analyst Bruce Leichtman of The
Yankee Group gave more credit to the actual high-speed-data and telephony services that
MediaOne offered under the broadband name.

Related