New Products, Local Presence Boost Business Services

Top Execs Say Differentiation Key In Increasingly Crowded Field

NEWPORT, R.I. – Business services continue to be one of the fastest growing segments of the cable business, but as the market matures operators are being forced to look at the business in a new way, coming up with additional services and differentiating themselves from what is becoming a crowded field.

Most cable operators have been in the business for decades – Cox Business lit up its first telephony market in the 1990s and has been grown its business services segment from about $100 million in annual revenue in the 90s to around $2 billion this year. That success, especially in New England Cox Business eastern region vice president Hyman Sukiennik said that has forced the company to delve deeper into its relationships with customers.   

“We’re so heavily penetrated, [we have] so much wallet share, now it’s a question of what additional products and services we can bring,” Sukiennik said at a panel session during the New England Cable & Telecommunications Association annual conference here Thursday. He added that one product the company is especially excited about is business security services, which was launched at the beginning of the year, and includes protection and surveillance products.

“We’re at a pivot point of do we want to move across the entire country,” Sukiennik said.

Charter Spectrum Business – Enterprise Markets senior director of sales Ross Bopp, added that the glut of fiber is being exacerbated by federal grants that are funding fiber overbuilds in underserved markets which overlap existing Charter facilities. In Nebraska, for example, Bopp said there are about 8 stimulus-funded overbuilders, which drives prices down to “unnatural” levels.

At Comcast, which is approaching 50% penetration of business services in some markets, Comcast Cable vice president, strategy Michael Soileau, said in Comcast territory, there are “at least” 280 networks that were funded by federal  broadband stimulus funds, and that “you can count on one hand” the ones that are successful.  While that presents a competitive challenge, Soileau said it also is an opportunity to emphasize cable’s local presence.

That local presence is an important aspect of cable’s success on the business services front.  Sukiennik said in Omaha, one of Cox’s telecom strongholds, the company has emphasized its strong community connection to great success.

“The way our industry is set up, we live or die on the health of our communities,” Sukiennik said.