Jumping into the potentially lucrative business market, Charter Communications Inc. is considering whether to offer commercial-class, high-speed data services across all of its 12 regions.
Charter Business Networks, the MSO's commercial unit, has limited rollouts to a few areas so far, but that could change once money from the division flows into its bottom line.
CBN became cash-flow positive two years ago, and its North Central operations alone are expected to pull down between $8 million and $9 million this year, said Jim Rice, the region's vice president of residential communications services.
Those early successes, which were initially spawned by Marcus Cable's FiberLink unit, prompted Charter's Eastern division to launch a similar suite of services, Rice said.
"We are now starting to look at how we can best template and replicate the services that have been successful," he said.
Charter is in the process of extending its commercial-class data services to all of its 12 regions. Each area will likely make its own decisions about when and if to make a move, Rice said.
To serve data to small businesses, Charter is using a variety of commercial-class cable-modems and routers with firewall capabilities from companies such as Com21 Inc. and Cisco Systems Inc.
Com21's Office Cable Modem combines the functionality of a residential modem with firewall capabilities, protecting the unit from unauthorized access, said Rei Brockett, senior product manager of Com21's access products division.
Firewalls essentially protect the network so each PC doesn't have to be individually shielded from hackers. The equipment is also designed for easy installation.
"You don't need to be an expert or need an IT department to deal with it," she said.
The modem, which supports up to 64 users, carries a list price of $760 with volume discounts for operators. If an operator were to go out on its own and purchase the modem, firewall and Ethernet hubs separately, the combined price would be more than $1,000.
Although CBN's primary focus is on high-speed data, it also plans to offer voice services to commercial customers, especially in the wake of a virtual collapse of the competitive local exchange carrier sector.
That strategy is markedly different than those of the other MSOs that offer business-class services. For instance, Cox Communications Inc.'s Cox Business Services division markets a menu of data, voice and virtual private network services, but is also exploring more advanced applications like video conferencing.
"We think there's an opportunity in this market, and we'll go ahead cautiously," Rice said. "Perhaps we could accelerate our plans and help out, or have a good value proposition for CLECs that are facing bleak times."
For now, "we're profitable, we're happy and we'll continue to make sure we don't get into a situation the CLECs are in," Rice added. He said CBN has experimented with VPNs, but hasn't decided when the company will push the technology.
Rice declined to discuss specific price points for Charter's business-class data offering, but noted that they're typically higher than the MSO's residential service and are determined by speed tiers and other price-sensitive features.
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