When cable marketers meet in Boston this week for the CTAM Summit, they’d be wise to cozy up to a local Comcast employee or two, buy them a beer and sit back and listen to how the company took a system with a lackluster (OK, lousy) track record under AT&T Broadband and transformed it into one of its star performers. In the 18 months since Comcast took over local operations, Boston, now its largest market, has gone from being a Beantown headache with very little field support and no upgraded services—resulting in outages, complaints and churn galore—to a modernized marvel boasting advanced products such as HDTV, a VOD service featuring exclusive local content and, on the horizon, DVR and VoIP. It used to lose subscribers steadily; now it’s gaining and retaining them. Comcast realigned its management structure and priorities to get closer to the community and focus on its needs, from launching more multicultural programming—including French channel TV5 and Italian channel RAI last month—to reaching out to the thousands of college students who move in each school year. "We are now a video-first company in this market, so people now clearly identify us as the video provider in Boston, whereas with AT&T Broadband that wasn’t the case," says Michael Doyle, president of Comcast’s Eastern division. "We’ve managed to turn around a company that had lost video customers in the previous 12 months to when we bought it. [We] turned that into a company that had a good year with sub growth gain, and is continuing to grow subscribers again this year." Comcast’s first step was to break down the former AT&T Broadband markets into more manageable areas, so the 2.2 million Northeast cluster that AT&T managed out of Andover, Mass., was divided into five geographic areas. Paul D’Arcangelo, area VP for Boston, or what Comcast calls the New England East area of the five divisional areas, reports to Comcast SVP for New England Kevin Casey, who in turn reports to Doyle. D’Arcangelo’s piece of the pie serves the largest portion—about 500,000 customers—of the Boston DMA, including greater Boston and the west and north portions of the city. "The Metro East/Boston area encompasses around 66 very diverse communities, including the city of Boston," says D’Arcangelo of the decentralized restructuring he helped implement after being promoted from VP of engineering and technology for AT&T Broadband’s Northeast region (he also served previous owners Continental Cablevison and MediaOne). "Within these 66 communities and half a million subscribers we’ve further broken down our operations into five field management areas. All of this has really brought our employees a sense of ownership and accountability for their particular cluster of customers." That’s not hype. In May, Comcast was named the best place to work in Massachusetts by the Boston Business Journal, topping a list of 50 companies throughout the state. "Today there’s a sense of pride and satisfaction on the employee side, which has resulted in a significant change in our customer perception and satisfaction statistics," D’Arcangelo says. Another employee morale-booster: Comcast restored 500 jobs to the Boston market that had been outsourced to other regions under AT&T Broadband. Competition to the Left and Right "In Boston in particular we’ve had to work harder than most," D’Arcangelo says. "This is a very, very highly competitive market." In addition to the DBS providers and Verizon’s DSL offering, more than 40% of Comcast’s footprint is overbuilt by a wireline competitor, RCN, and one municipal overbuilder. Residents have many choices, so Comcast tries not to give any customer a reason to leave. RCN is so hungry in Boston, "it’s pretty much giving away product—that’s how aggressive it’s been with pricing," D’Arcangelo says. "When we took over the operations, we were losing a significant amount of subscribers on a monthly basis to our competition. We’ve really done a 180-plus in terms of changing the customer perception that it’s not all about price, it’s about value, and that’s what we focus on." D’Arcangelo’s director of marketing, Vic Pascarelli, has been responsible for delivering Comcast’s value proposition directly to Boston customers. One of his first orders of business has been unlocking RCN’s exclusive arrangements with landlords. "We have a lot of multiple dwelling units in our footprint, and we weren’t even allowed in some apartment buildings because RCN had a revenue-sharing deal with the ownership," says Pascarelli. "We put in a marketing group to get close to our apartment managers and owners to talk about the great job we’ve done upgrading the system and our products, and we’ve since made a lot of headway." Now, he says, some of those same property owners have been approaching Comcast looking for exclusive deals. While it’s up to Pascarelli and his staff to dream up such youth-savvy strategies as unleashing Segway-driving and tie-dye T-shirt-sporting guerrilla teams to sign up students—the latest back-to-school campaign added up to 18,000 new subscribers this school year—they get a lot of support and guidance from regional VP of marketing Randy Waddell and his team, who in turn trust their Boston area marketers to execute regional initiatives. "Because we dominate the market here in Boston and, for the most part, in New England, we want to leverage things that we can on that scale," says Waddell. "We’ve created large sales organizations that serve each of this region’s five areas." For instance, with Comcast’s "broadband sales queue," all the sales activity, whether it occurs in D’Arcangelo’s and Pascarelli’s market or in Connecticut or New Hampshire, flows into a queue of 160 three-product trained reps capable of selling the complete portfolio of Comcast products. Their job is to help any customer calling to order one of those products, and then sell them a second or third product. "Boston is a critical market because it’s highly competitive," Waddell adds. "That, and its urban characteristics, differentiate it from the balance of the market." For those reasons alone, it’s a market that Comcast focuses on extensively. He says the company is interested in bringing products and services to this market "not necessarily first, but certainly quickly." Comcast will spend incremental resources in that market because it has the most to lose in terms of competitive churn, and also the most to gain in terms of having an opportunity to win back customers. Comcast On Demand has been a critical weapon in the war against churn, particularly with the "Get Local" content that was added in April. This feature aggregates local video programming from Comcast’s CN8, plus local Boston ABC and PBS affiliates and footage from regional networks New England Cable News and New England Sports Network. Comcast has a high penetration of digital subscribers in New England. By delivering on-demand services to those customers, it’s been able to drive profitability three ways, Waddell says. First, it sells more customers into digital as a result of having on-demand content. Second, on demand drives churn out of the digital category; churn has dropped by about 30% since digital launched, with 75% of that churn reduction coming in the last year since the launch of on demand, according to Waddell. "Finally, we’re leveraging this product to win back customers, and that’s particularly important in the Boston market where not only are we facing competition from satellite, but also directly from overbuilders like RCN," he says. Local Push for Local VOD Early usage information on the local VOD component suggests that customers are accessing the Get Local on-demand content frequently. "In each partnership, we have plans to expand that content over time," Waddell says. He’s now talking to NECN about having the network produce unique weather reports for each of Comcast’s five markets. "They would then pitch those to us through a dedicated fiber feed, and we would put those segments on the server." Local VOD marketing efforts are playing well, including a traveling mall tour this past holiday season that demonstrated Comcast On Demand to more than 35,000 visitors. "We closed a fair amount of customers and took a lot of leads that we followed up with through outbound telemarketing," Waddell says. "The focus of the initiative was to create awareness. We spent several million dollars in the market late last summer and fall introducing on demand to our customers here in New England, and the mall tour was just one of the tactics—cross-channel also played a big part—in getting existing customers exposed to our new products." Comcast also plastered tollbooths, buses, taxicabs, subways and bus stops throughout the city with Comcast On Demand messaging. Motivated employees also are spreading the word, says Pascarelli. "We’ve had great success with our tech sales group here in Boston, in particular, walking into customers’ houses and bringing a digital box with them and saying, `You have to see this.’ And then they walk out the door [having served] a customer who’s not only digitally upgraded, but very happy with their on-demand product." The buzz around VOD has boosted usage. "Once customers use it, the incidence of repeat usage is incredibly high," says Waddell. "We continue to have a high degree of our cross-channel avails [for] this product, and we identify who hasn’t accessed our on-demand content and are mailing them on a monthly basis with VOD mailers that talk about the free content and how to access it. We’re targeting our premium digital customers because our premium VOD content is the content that’s being accessed the most, so we want to make sure people understand that if they subscribe to HBO they can access The Sopranos or other HBO content at no additional cost on demand." Before Comcast came in, "money was being spent on marketing, but the message was confusing," says Doyle. Literally bringing a clearer message is high-definition service, which Waddell says is being marketed "aggressively" to sports-mad Boston. "It helps differentiate us from satellite because we have HD product that they don’t have, including local broadcast feeds in hi-def, Bruins and Red Sox games in high definition," Waddell notes. "If you have an HD set you can’t get those games in HD anywhere but Comcast HD. So we will continue to invest in HD content. We have plans over the course of this summer and beyond to add channels in HD and add local content. We’ve just come to an agreement with Fox Sports to offer the Celtics games in HD. We hope to have HD content available on demand in the near future." As Comcast has signed up HD customers, it’s finding that two out of 10 are former satellite customers. "The high ground satellite once had with consumers, being viewed as having the best mousetrap, is no longer true," says Waddell. "As new technology evolves, cable operators—who have robust two-way platforms, which satellite doesn’t have—are better positioned to offer these new products to consumers who are adopting them. There’s no better example of that than HD and on demand. Both products not only leverage the bandwidth of our platform, but also the fact that it’s a two-way platform." Next Up: DVRs High-speed Internet service is another performance-booster, Waddell says. "Having the data product in the home just makes Comcast’s value that much stickier," he says. He’s looking forward to continuing that momentum by launching digital video recorders from Motorola. Comcast will introduce those DVRs aggressively starting this summer, he says. "We see DVRs as a key component to a suite of products that help augment and differentiate our video product from our competitors. The ability to combine DVR functionality with on-demand functionality essentially allows the customer to watch television on their terms. They’re no longer setting appointments with linear networks but can access any content, whether it’s broadcast or on-demand content, whenever they want. And that’s a powerful message we’ll be delivering to this market." Voice over IP telephony is also on the horizon. Comcast is conducting a VoIP trial in Springfield, Mass., outside of greater Boston, and wants to hold off launching the product in the Boston DMA until after that test is completed. Comcast now offers circuit-switch telephony (a legacy from previous operators) in 50% of its footprint in New England, including most communities in the Boston area, but not in Boston proper. "We’re eager to introduce voice over IP in our non-circuit-switched markets," Waddell says. "That will allow us to compete head-to-head with RCN, which does have a phone product in its markets." D’Arcangelo and his staff want to serve customers better by adding more multicultural products and expanding commercial services, particularly to local colleges. "Our first job is to continue to attack the competition," he says. "We can’t get complacent with our operations. We need to continue to serve our customers and improve our customer satisfaction. That’s a huge focus for us this year. We keep saying if we don’t give people a reason to leave, they won’t leave." Hot on the heels of the CTAM Summit, the company will be busy helping the Democratic National Convention stay connected and aware, whether providing high-speed connections for delegates or providing in-depth coverage on linear—and of course, on demand—thanks to CN8. "We did this with the Republican convention in Philadelphia four years ago, and with the DNC coming to Boston we once again expect to put on a really good evening’s newsgathering performance, which the networks seem to be shying away from," he says. "We’re one of the few organizations that’s going to be in a position to put on a strong show, and not just newsreel highlights. This is another leap forward for CN8 as a network and Comcast as a company."

The Daily

Subscribe

Indy Show Hits Screens This Week

The fifteenth annual joint Independent Show is going to look a little different this year, but ACA Connects and NCTC have pivoted to bring a full virtual experience to their members.

Read the Full Issue
The Skinny is delivered on Tuesday and focuses on the cable profession. You'll stay in the know on the headlines, topics and special issues you value most. Sign Up