News

MSOs Urge Caution on New Services

3/18/2001 7:00 PM Eastern

NEW YORK-Despite their success with new services like digital cable and high-speed data, executives from a trio of MSOs last week said they'll be cautious with future rollouts.

Dave Watson, executive vice president of marketing at Comcast Corp.'s cable unit, said that while the MSO would give video-on-demand a big push later this year-starting in Baltimore-the jury was still out on how much effort to devote to other advanced services, such as telephony and interactive television.

"You have to be careful and very discretionary," Watson said during a Kagan Seminars Inc. conference. "You have to look at what is going to give you the highest digital [platform] lift. VOD is the home run. The rest are singles."

Charter Communications Inc. executive vice president Steven Schumm agreed with Watson. Though Charter has been extremely aggressive on the digital front-it signed up 1 million digital-cable customers in 2000-the MSO is continuing to be cautious in its deployments of other advanced services.

Schumm said the company is conducting telephony trials in St. Louis and Wisconsin using Internet-protocol technology. It will also inherit about 13,000 circuit-switched voice customers in St. Louis from AT&T Broadband, as a result of its acquisition of about 574,000 of that MSO's subscribers earlier this month.

Charter also expects to hire a senior vice president of voice services in April to manage its telephony rollout.

In addition, Charter has interactive-advertising services available to about 300,000 customers, through Wink Communications Inc. It plans to roll out interactive ads to about 50 percent of its customer base by the end of the year.

"It's a careful balancing act," Schumm said.

Mediacom Communications Corp. chairman Rocco Commisso, meanwhile, said telephony and VOD were not on his agenda for this year.

Mediacom-which doubled its size earlier this month through the acquisition of 840,000 AT&T Broadband subscribers-will continue to focus on digital-video and high-speed-data rollouts.

Commisso said he has spent the past three years focusing on upgrading Mediacom's systems. While the MSO has about 40,000 digital subscribers and roughly 12,000 high-speed-data customers, he conceded that Mediacom's systems are about six months to a year behind larger MSOs in terms of new services.

Commisso said the high-speed-data rollout was held up somewhat by SoftNet Inc.'s decision to cease its ISP Channel operations on Dec. 31. Mediacom has since switched its cable-modem provider to Excite@Home Solutions.

"Unfortunately, ISP Channel decided to get out of the business," Commisso said. "We could have done a much better job if they were around."

In light of the AT&T Broadband acquisition, Commisso said Mediacom may seek out further acquisitions, albeit much smaller ones, in areas adjacent to its new properties.

"We will be the largest operator in Iowa, the second largest in Illinois [as a result of the AT&T deal]," Commisso said. "Whoever is around us has no place to go but into Rocco Commisso's hands."

September