Can Cablecos Get It Together for Business Markets?

The SMB market is notoriously finicky when it comes to choosing communications services. SMBs tend to be price-sensitive and risk-averse, with a requirement to be catered to via a consultative sales process to address very specific business needs. That’s made SMBs a difficult market to serve, even as they cry out for an alternative to the LEC. But the cablecos think they’re up to the task.

“Look at the Telecom Act; it took 10-plus years to get here to the idea of true choice from a provider that can do it over their own network,” said Ken Fitzpatrick, senior vice president of business services at Time Warner Cable (TWC), which serves 300,000 commercial accounts, mostly SMBs, with data, voice and Ethernet. The business side is growing twice as fast as the residential market, so SMBs are a major focus for the organization. “The landscape right now is the ILECs and the cablecos. And we can deliver services to SMBs the way they want to be dealt with. They don’t want to be a number, one of millions. They want localness, some flexibility. And they want the same capabilities as the big guys.”

The “Cable Guy” Problem

Cablecos seem to be positioned perfectly to capture the lucrative SMB set. The problem? You can’t really ask an SMB to make sure to be home next Wednesday between 8 a.m. and 4 p.m. for a repair tech to show up to fix an outage.

Well, you can, but it’s not likely to go over well, considering that most SMBs live and die by their broadband connections and the hosted applications and VoIP delivered over them.

And that outage that’s being repaired? Horror stories abound on the residential side about Internet and digital voice being knocked out on a fairly regular basis, and the nothing-but-lackadaisical customer service staff that answer the fix-it call. Considering that SMB owners making the communications decisions also are likely to be customers on the consumer side for television at the very least, the cableco reputation for poor customer service and reliability is a sticking point that is hard to get business targets to forget about. That makes the offer of SLAs a real imperative.

“The questions for them are, ‘How do you support a business customer and how different is it from supporting consumers?’” noted John Macario, president of consulting firm Savatar. “If there’s an outage, for a consumer you might say that we’ll be there tomorrow. But if I’m a business and my voice is down, that’s just not good enough.”

While cableco business accounts are undoubtedly a high-growth area, there’s no doubt that very growth is presenting these service providers with some challenges.

“Our strategy initially rolling the products out is that we wanted to focus on the quality, not the quantity,” said Ed Gallagher, vice president and general manager of business services at Comcast Communications (CCW), which has the largest MSO footprint in the country. “Scaling and the back office can be a challenge because the growth has been so explosive. The differentiator for us is going to be customer service — someone that can add something else that makes those customers feel they’re getting the same support as the big guys.”

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