Comcast Checks Into a New Revenue Stream
Comcast Corp. has created a healthy revenue growth engine by going after business customers. We'll know more on Wednesday (Feb. 13) when Comcast reports its fourth-quarter results, but the MSO was already on pace to easily blow well past the US$2 billion mark in annual revenues, and is expected to flirt with $3 billion in 2013.
And that's just scratching the surface of the financial opportunity that's being targeted. Comcast has long estimated that the revenue potential for the small/mid-sized businesses and small enterprise customers in its footprint are each worth about $15 billion.
Comcast is using its Metro Ethernet platform to hit businesses with up to 500 employees, and now it's starting to use it to help market higher end services to the hotels market via its new Comcast Business Hospitality services suite. (See Comcast Makes Hay With Metro Ethernet and Comcast Checks in With Hotel Services.)
Comcast won't say how many hotels have already taken the plunge, but we know of at least one: The Raymond Group, which owns or manages more than 30 properties, including many that operate under the Marriott and Hilton brands.
Raymond has already signed up with some properties in the Comcast footprint, including four in the Chicago area, and two that are opening up in Ann Arbor, Mich., says company IT Director Steve Dettman.
Offering in-room HD is no longer a differentiator. "It's the price of poker right now," he says. Comcast claims its new hotel services platform can offer up to 60 HDTV channels.
Dettman says one area where his properties hope to stand out is with fiber connectivity and faster data speeds that could be marketed at a premium. Hotel guests are increasingly using services like Netflix Inc. when they're on the road rather than ordering in-room movies, so hotels are always looking for new revenue opportunities.
"If [customers] can get 50-meg at home, why can't we have it in our rooms?" Dettman asks, adding that his group is starting to beta test some new premium broadband tiers tailored for hotel guests.
Comcast claims it can deliver up to 100Mbit/s downstream to hotels for Internet services, and between 1Gbit/s to 10Gbit/s via its dedicated MetroE platform.
It'll take some time for Comcast's new hospitality strategy to pay off. But it's getting aggressive at an opportune time. LodgeNet Interactive Corp., one of the sector's leaders, is in the midst of a Chapter 11 reorg.
— Jeff Baumgartner, Site Editor, Light Reading Cable