Business-services opportunities have been a big part of the chatter around the benefits of the pending Comcast-Time Warner Cable merger, with both sides stating the combination could help the industry crack the elusive large-enterprise market. But what about the other MSOs? Cox Business, one of the segment’s pioneers, grew revenue last year by about 14% to $1.6 billion and is on track to reach $2 billion in sales by 2016. Senior vice president Steve Rowley spoke with senior finance editor Mike Farrell about the outlook for commercial services. An edited transcript follows.
MCN: What is your outlook for the segment?
Steve Rowley: Our focus is still driving to $2 billion [in revenue] by 2016, and we have a clear picture of that and we’re on track. I think the exciting thing is we continue to see a great push and are excited about our cloud services like our hosted PBX (private-business exchange). Our hosted IP Centrex has been a great product for us; it’s been great in our mid-market space as well as our small-business space. We continue to see outstanding growth in the voice arena. In the telecom industry overall, voice seems to be declining, but I see great advancements and growth in that arena.
We continue to see a lot of energy around what we call large locals — larger customers in our franchise area. We’ve been able to see success in that arena, as well as the wholesale carrier space. [What’s] driving that is really just bandwidth consumption on the Internet connectivity side and [on] the transport side. We’ve also been able to form a partnership with a company called ViaWest, which is really in the data center business and is allowing us to have best-in-class transport and matching that up with a world-class data center and providing those services to our customers.
MCN: How big is the business telecom market in your footprint? Is it growing?
SR: We view it as a $6 billion opportunity. We see it stabilizing as we continue to offer new services. We like to grow the pie, so our partnership with ViaWest and offering new products and services keeps that stabilized.
MCN: Other operators have said there is still a big opportunity in selling more services to the small-and medium-sized base. Is that the case for Cox, or have you evolved to the next phase?
SR: I think its coincidal. We still see great growth in that [small business] area. We still have great products for that industry; our telecom specialists are able to provide them a suite of voice and data services and act as a telecom adviser for them. In our franchise area, we still think we have a long road map for success in that small-business space.
MCN: Comcast and Time Warner Cable have talked about the benefits their merger could bring to their business service offerings. Could that merger have any effect on your business, good or bad?
SR: We’ve talked about national accounts and how to support those. We’re trying to discuss that and figure out how we can work together down the road. The criticality is making sure you have the right standardize quality of service and service delivery intervals. There really is opportunity. I think it’ s going to continually evolve over time.
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