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Cable Operators

Triple-Play Junction

2/27/2005 7:00 PM Eastern

When Bresnan Communications took control of the Grand Junction, Colo., cable system two years ago, the property was in dire need of attention. The 27,500-subscriber system was in the middle of a rebuild that had been started and stalled during AT&T Broadband's ownership. Customers were defecting to satellite in droves.

Today, the system is a state-of-the-art operation and the jewel of Bresnan's holdings. Indeed, the MSO is launching a voice-over-Internet protocol offering on Feb. 28, making it the first Bresnan operation to provide a full bundle of voice, video and data services. The company is using Net2Phone Inc.'s hosted telephone platform and Cedar Point Communications' SAFARI C3 media-switching system to deliver the service.

Grand Junction, Colo.
Category Amount
Population: 47,600
Median HH income: $33,300
Average age: 39
Homes passed: 54,600
Basic subs (penetration): 27,400 (50%)
Pay units (excluding Encore): 23,100
Digital subs (penetration): 11,600 (42%)
High-speed data subs: 8,100
Source: Bresnan Communications, City of Grand Junction, U.S. Census Bureau

Bresnan has had about 100 employees and customers testing the local phone service since November, and according to general manager Sean Hogue, only one technical issue has cropped up in that time: a piece of line gear equipment failed.

“We expected to see bumps,” says Gary Young, area technical operations manager. “That's why we've been testing the system internally since last fall. We've been quite pleased with the performance.”

Earlier this month, the MSO sent a direct mailing that touted the local phone service to area customers. Bresnan plans to expand its marketing efforts with more advertising and direct-mail pieces, Hogue says, and it plans to have a booth at the local shopping mall and community center touting service.

Employees have been receiving extra training so they can explain, sell and install the phone service. Technical preparations have been underway for the better part of the year, Young says. Things went into high gear beginning last August to prepare for the Feb. 28 systemwide launch.

Bresnan employees are used to the hectic pace of new product launches. The system launched video on demand and HDTV last June. Digital video recorders were first made available to Grand Junction customers in November. High-speed data service has been offered since 2000, and a digital-cable tier was introduced in 1997.

Bresnan has made major changes to both services since taking control. The MSO made the conscious decision to use contractors to install its video product and train its employees to handle the more complex products like high-speed data and telephone, Young says. That takes some of the pressure off the technicians to know and handle every service call.

So far, the incumbent telephone provider, Qwest Communications International Inc., has been silent on the impending competition for local phone customers. But Bresnan executives don't expect that to last long. While Qwest currently suffers from a tarnished service reputation, and is saddled with a huge debt load, the phone company doesn't figure to stand idle while a competitor steps in and grabs market share. Qwest officials declined to comment on Bresnan's planned phone launch in its service territory.

So far, the city government hasn't received one complaint about the cable provider since Bresnan took over, says assistant city manager David Varley. Relations between the city and the system's previous owners weren't all that bad, he says. But Bresnan has done what it said it was going to do, and that pleases regulators. “We're in the process of renewing our franchise with them now, and negotiations are going smoothly,” Varley says. “They've added channels and services, and they've done everything we've asked them to do. Bresnan is definitely more small-town, service-oriented than some of the previous owners.”

Meanwhile, the system continues to stem subscriber losses by offering new video products and emphasizing its data product. After taking control in 2003, Bresnan completed the upgrade started by AT&T years before. The MSO also made sure the system and its employees got heavily involved in the community. It brought in new talent. (Hogue was with Insight Communications Co. until last December, and Young had been with Comcast Corp. in Utah until last May.) And Bresnan began training its existing employees in the system more extensively.

“We're trying to introduce a new culture here,” Hogue says. “It's crazy to spend five times the amount of money to acquire a new customer than it does to retain them. We need, as an industry, to devote more time to retaining customers.”

The new bundle ought to help with that initiative, Hogue says. But it won't be enough. Bresnan is instigating new programs to gauge customer satisfaction and loyalty. Customer service reps follow up after each service call so the MSO can immediately take care of any new issues before they become overwhelming.

Bresnan is also trying to better educate its customers about the products they're subscribing to, Hogue says. And it has begun stringing out technicians' schedules a bit more, allowing them more time to explain and demonstrate the service each customer receives.

“Our technicians are going through the entire VOD process with our new and upgrading customers,” Hogue says. A tactic of giving customers their first VOD purchase for free is paying off. “We've only been doing it for a few weeks, but it's been powerful. We're already seeing higher buy rates for our VOD movies.”

September