What's Next for Cable Business Services?
Is video cord-cutting posing a threat to cable's future commercial prospects?
Could be. In interviews that I recently conducted with a dozen cable business services executives on behalf of Light Reading, several of them said that such cord-cutting by residential subscribers may actually be having a detrimental effect on their relationships with commercial customers. That's because these cord-cutting consumers are also business decision-makers and they are questioning the long-term viability of their cable companies, both at home and at the office.
Fortunately, this challenge also represents an opportunity for cable operators, or even a mandate from the market, to "push the pipe." While the industry's core pay-tv business television may evaporate (or shrink faster), the need for "best of breed" broadband is an accelerating imperative. Indeed, many cable operators and other service providers have already started to embrace this market force and are re-architecting their networks to be fiber-deep or even fiber-to-the-home.
Comcast Corp. (Nasdaq: CMCSA, CMCSK) Chairman and CEO Brian Roberts highlighted the ever-growing prominence of broadband on the company's third-quarter 2017 earnings call last fall when he stated that: "Our broadband business is increasingly the epicenter of our relationship with customers, and ultimately where we derive the majority of our profitability."
With such a transformational shift taking place, maybe it's even time to give cable a new name. In fact, such a name change has already happened. Consider the industry's main trade association, NCTA, which now bills itself as The Internet & Television Association.
Besides the industry's seismic shift from video to broadband over the past few years, my research revealed a number of other key factors impacting the cable commercial marketplace today. These factors range from the virtualization of network functions and services and the construction of fiber-deep network architectures to service chaining and the ever-more rapid development of new commercial products and services.
The business services executives also discussed the oft-overlooked role of customer satisfaction and new, better ways to measure that satisfaction. As one interviewee put it: "When it comes to measuring customer satisfaction, Net Promoter Score is just the tip of the iceberg."
Then there's the competitive factor. Instead of focusing mainly on the AT&Ts and Verizons of the world, some MSO executives say they're increasingly more worried about the smaller, more nimble market upstarts. "Beware the small insurgents," one interviewee advised. "They may represent a greater long-term threat than the large incumbents."
Given the fundamental changes occurring in the commercial market, how can cable operators survive and thrive? Light Reading and Broadband Success Partners are teaming up to tackle that question with a special webinar next Wednesday, March 7 at 11:00 a.m. ET. This one-hour session, which will feature two leading MSO business services executives and be sponsored by Ciena Corp. (NYSE: CIEN) and Corning Inc. (NYSE: GLW), will focus on how cablecos and their suppliers are addressing the emerging business services challenges and opportunities.
Speakers will include Dan Templin, SVP of Mediacom Business; Brian Hoekelman, VP of Product and Business Intelligence at WOW!; Glenn Calafati, Global Director of Media & Content Industry Consulting at Ciena; and Catherine McNaught, Manager of Emerging Applications Market Development at Corning. I will join them to present the research findings and spur the discussion.
So please join all of us on March 7 for an informative and lively conversation about the future of cable business services moderated by Light Reading's Alan Breznick. Simply register here to sign up for the webinar.
In the meantime, check out this video interview with me for a preview of some of the research results that we'll be discussing on the webinar. (See Is Cable Taking Care of Business?)
— David Strauss, Principal, Broadband Success Partners