VOD Hooks Longhorns

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Many local system executives would give an eyetooth for a market as ripe as Austin, Texas.

In 2003, Forbes crowned the state capital as the No.1 place to do business and advance a career. In the midst of an economic recession, Samsung Electronics America Inc. has planned a $500 million expansion in that city, while international technology company GTECH Corp. has said it will relocate jobs into the area.

Time Warner Cable's Austin system keeps pace with this progress —it's often selected to be among the vanguard for the new products introduced by its corporate parent.

"Austin is intellectually and technically proficient," said division president Tom Kinney. "People expect the latest and greatest, and as a result of that proficiency, they provide valuable feedback on their lives and the use of those products."

As a result, Time Warner Austin was one of the early deployment sites for digital cable, video-on-demand, high-speed Internet (by 1998, Time Warner was the largest Internet-service provider in Texas) and digital video recorders.

"And digital phone is just around the corner," Kinney said.

Such products have helped Time Warner attract 302,623 basic customers from among the 532,438 it serves in Austin and its more than 35 suburban communities.

That's a 56.8% rate of penetration.

Of those, 123,534 households have subscribed to digital cable, but more customers — 148,192 — take Road Runner data service.

These advances may be why a survey commissioned by the greater Austin Chamber of Commerce to determine the city's business climate said Austin's communications and technology infrastructure is superior to that of comparable midsized cities.

Time Warner continues to advance — the system recently launched wireless Internet service, and it's already attracted 5,283 customers.

But it doesn't take its customers for granted. One of the system's more vigorous internal programs focuses on retention, said vice president of operations Steve Fairby.

To meet company "grow-and-keep" goals, the system created a retention task force, with members from all of its departments, to brainstorm on processes and incentive programs.

"We saw a big bang after that," he said. "We saw a 300% increase in saves after we formed the task force. They help keep the issue top of mind."

Other retention strategies include strong education efforts at the time of installation, so customers really understand how to use their new products and thus remain satisfied. Promotional customers, who may see a large jump in their bills after the offer expires, get pre-emptive calls just before that bill, added vice president of marketing Terri Cumbrie.

Localism also plays a big part in Time Warner Austin's success. The system has had strong local ties since 1981, when Time Warner's predecessor bought the franchise rights from the family of the late President Lyndon B. Johnson, executives said.

Current community efforts include broadening the system's local on-demand content. Twenty percent of current VOD users log on for local content, Kinney said.

The system is working with the University of Texas to create an archive of sports coverage to sate the avid Longhorns fan. The university's mascot is named Bevo, so the new product is dubbed BEVOD.

Public-affairs initiatives are divided among economic development groups (the chamber of commerce, Urban League, Hispanic chamber and Opportunity Austin), the arts (the LBJ Library and the municipal symphony and opera) and education (the public-school district and Volunteers in Education, which brings HSI and instruction to smaller, less affluent schools). Each of the system's vice presidents is charged with joining a community organization.

"There's been a huge return on that investment," Kinney said, noting that the Urban League named Time Warner Cable its 2003 company of the year. The Hispanic chamber bestowed a similar honor.

Time Warner also uses its capital location to solicit for government business — it provides high-speed data to several legislative offices — and to show off its products to lawmakers. One thing it doesn't do: Flag the accounts of those decision-makers to ensure exemplary customer service.

"That would be problematic," said Kinney, who added that all customers deserve great service.