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Cable Technology Feature Article

May 14, 2010

Cox Business on Track for a $1 Billion Year in 2010; Double in Six Years

By Doug Mohney, Contributing Editor

The Cable Show 2010, Los Angeles, CA (News - Alert) - Cox Business Vice President Phil Meeks said his company was on track to do one billion dollars of business by the end of 2010 and has plans to double that amount in six years. 

Business services for the cable company are more important in 2010 as residential growth slows down due to product maturity.

"Our short term future roadmap is to get products out the door faster," said Meeks. "We have PRI over HFC capability in all of our markets. Our VoiceManager hosted VoIP platform is available in three-fourths of our markets now, and will be available in all of them by the end of the third quarter... Before the end of the year, we'll be offering SIP trunking and IP Centrex services."

Cox (News - Alert) Business is working to make its business more scalable and more efficient through standardization and automation, but doesn't want to dilute the "localism" -- the relationships Cox has with its customers in its 20 markets across the country -- in the process.

"The challenge is strategic," stated Meeks. "What is standardized, what do we keep local?"

Out of the company's 250,000 business customers, Meeks characterized 80 percent of them as "very small -- 19 and fewer staff."  Part of the company's strategy has been to focus on selling more products to the established single product customer base.   Cox is establishing a "high touch" base management call center which will first call the customer 48 hours after service has started to make sure everything is running smoothly.  After 45 days, the customer will get another call to make sure they have received the first bill and ensure it is accurate.   Depending on size, further calls will come every 60 to 90 days to make sure the customer is happy and "Oh by the way, would you like to buy....?" with bundles playing a key role in the offers made.

However, there's also 20 percent that represent wholesale and larger upmarket enterprise relationships contributing to the bottom line as well. Last year Cox is booked $100 million from carriers in wholesale services. "It's doing what we want it to do," Meeks said.  "The big drivers are carrier backhaul and wireless backhaul." One recent win is a 5 year, $100 million deal for wireless backhaul.

"We do very well" in verticals geographically concentrated within Cox's operating territories, said Meeks, including hospitals, universities, and government.

Big growth is expected when Cox adds its own wireless services to the mix. "It's a significant opportunity," Meeks stated. "The wireless SMB opportunity is a $4 billion market. The data also indicates that there's a high level of dissatisfaction with current wireless providers in the SMB space; most providers don't have a small business program, low-end SMBs really are not satisfied."

Cox will "do what the market is asking for" by introducing pricing and product bundles to fit the SMB.  It also expects success by going to market with the same core sales team already selling its wireline products, presented an integrated -- rather than separate -- approach to its existing and future customers.

Business offerings will follow Cox residential deployments in a specific market.  The company has already conducted an internal launch of wireless services in Hampton Roads, VA, Omaha, and Orange County, California and an official launch is expected "soon," with timing of business offerings to be determined after that.

Unlike other cable operators, Cox will use a mix of wireless services.  MVNO services will be provided by Sprint (News - Alert) -- which will also provide national roaming -- as well as building its own physical wireless infrastructure.  The currently announced wireless markets are all MVNO arrangements, but the company is building out other unannounced markets "behind the scenes."

Doug Mohney is a contributing editor for TMCnet and a 20-year veteran of the ICT space. To read more of his articles, please visit columnist page .

Edited by Kelly McGuire