It's been a little more than a year since he was named Cox Communications chief financial officer, but Mark Bowser's priorities are simple: growth.
And these days, the Atlanta-based cable operator has a lot of opportunities to satisfy that priority in business services, interactive advertising and a soon to be launched cellular service.
"We continue to focus on growth, which is difficult in the economy we're in," Bowser said, adding that about 40% of Cox's capital expenditures are geared toward growth initiatives.
Bowser knows all about business services - he used to run the unit for Cox before being named as CFO in March 2008 and has more than 20 years under his belt with both Sprint and GTE.
Cox was one of the first MSOs to offer business services - it started by offering competitive access in Hampton Roads, Va., in 1993 and expanded to the rest of its footprint by 1996. Despite that longevity, the commercial services unit is still growing - revenue was up 16% in 2008 and the unit is expected to top $1 billion in sales by 2010.
On the interactive advertising side, Cox is part of the Canoe Ventures consortium with Comcast, Time Warner Cable, Charter Communications and Cablevision Systems. Canoe is readying for the launch of its first product - community addressable advertising - in the next few weeks.
Although Cox is an active and supportive member of Canoe, the nation's third largest cable company decided to stay out of another consortium - Clearwire - instead opting to build and launch its own cellular network.
Cox has ownership of a large chunk of 700 megahertz spectrum it purchased through the Federal Communications Commission's Advanced Wireless Spectrum Auction last year. Cox spent about $300 million for its spectrum and plans to invest about $500 million in the wireless venture, according to some reports. The operator's absence from the Clearwire group, which plans to build a nationwide Wi-Max wireless network over the next three years, has cast a bit of a shadow on the consortium.
While some have said that Cox had enough of wireless consortiums through its participation in the ill-fated Pivot group - with the same cast of characters - Bowser said it was more of a case of control and maturity. Maturity in the fact that Cox has been in the phone business a lot longer than others - it launched its first residential product
in 1996 - and control in the fact that the company wanted to call the shots for all aspects of its wireless product.
"We are at a different stage than many of our peers," Bowser said. "We got into wireless phone and data significantly before they did. It was important for us to launch a wireless product that we could control."
And in part control means control over the technology. Cox is building its cellular network using Long Term Evolution technology - a higher capacity 4G standard being adopted by AT&T, Verizon Wireless and operators outside the U.S. - while Clearwire is focusing on Wi-Max.
"At the end of the day we think that LTE will win over Wi-Max," Bowser said.
Cox also seems to be splitting from the pack in that it wants to launch a cellular phone product, while most of its cable peers seem more enamored with wireless data. But Bowser said that having a Cox branded cell phone product to add to the existing bundle of wireline voice, video and high-speed data is an integral part of the overall product offering.
Bowser would not say how much Cox is spending on building the network but added that it is being funded internally, so there is no need to tap the credit markets in this uncertain economic environment. He added that the company intends to launch the service in two markets this year and an additional two markets in 2010. He would not identify them.
Cox went private in an $8.5 billion deal in 2004 and Bowser said that gives the company "the luxury of being able to invest for the long haul." But as part of Cox Enterprises, the cable giant is lumped in with some businesses that have had a hard time in the down economy - basically its newspapers and Manheim, a provider of wholesale remarketing services for commercial vehicle sales and auto dealers.
Bowser admits that Cox Enterprises has some challenges, but he stressed that it has no affect on Cox Communications.
"As a company, we're relatively speaking a cautious company," Bowser said. "The other side of the house is more ad-supported and more auto-supported. But because of the way we manage the business, it is not an issue."
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