The southern half of New Jersey is a lot like Philadelphia. Since there are no local broadcast TV stations housed in the state, the Philly affiliates hold sway in South Jersey. Philadelphia radio stations dominate as well and the Philadelphia Inquirer is the house paper at the Windrift resort in Avalon, just as it is at many hotels along the shore, from Cape May north to Ocean Beach and Atlantic City. South Jersey residents are loyal to Philadelphia’s Eagles and Flyers — not New York’s Giants and Rangers, or even New Jersey’s own Jets or Devils, for that matter. So it’s apropos that the region is served by Comcast Cable, which of course is headquartered in Philadelphia. Most of the Comcast South Jersey region is actually situated in the Philadelphia demographic market area. The system stretches south from Philly to the Vineland/Pleasantville area, and extends to Bordentown Township, just south of Trenton. In total, it passes 835,000 homes and serves 620,000 basic cable subscribers. The system is an amalgam of many different acquisitions the company made near the end of a growth spurt that saw its subscribers jump to 7.5 million at the end of 2000 from 4.2 million in 1996. In January of 2000, Comcast paid $6 billion in stock to acquire 1.1 million subscribers in the Philadelphia area from Lenfest Communications. Two big system swaps around the same time beefed up subscriber rolls in South Jersey. In January 2001 Comcast swapped 750,000 subscribers in Chicago, Sacramento, Colorado, Florida and Georgia for 750,000 AT&T Broadband subs in Washington, D.C., Pennsylvania, New Jersey, Florida and Michigan. The same month it closed a swap with Adelphia that bolstered its New Jersey cluster. One of the challenges Comcast had in South Jersey was dealing with a stew of systems that started out as upwards of 20 small systems that went through a series of mergers, says Greg Arnold, the regional VP for all of New Jersey. Because of the number of acquisitions that had preceded the acquisition by Comcast, the company was faced with skepticism from local franchise boards, Arnold explains. “A lot of promises had been made by previous operators about coming services and what the cable systems can do that were never lived up to,” he says. “That left us in the interesting position of having never dealt with these franchises and having a credibility issue.” It took some convincing to overcome the dubiety of franchise officials when they heard Comcast promise it would upgrade the cable plant and deliver digital and other advanced services. But at that point they weren’t yet familiar with Mike Doyle, the president of Comcast’s Eastern division, whose single-minded focus was to get the digital platform into as many homes as possible. “It’s a fast-moving world working for Mike,” says Arnold. “He challenges you to do better, to do things in different ways.” The franchise boards soon realized that Comcast had no intention other than to keep its word — for its own benefit. To get a jump on rolling out digital, the company needed to be as aggressive as possible. All told, Comcast invested about $680 million upgrading the South Jersey plant. “We wanted to take advantage of every means we could now that all of these products were available,” Doyle says, referring to digital and high-speed data. The investment appears to be paying off in a big way. South Jersey enjoys better-than-average penetration of digital and high-speed Internet, with penetration rates of basic subscribers of about 43% and 22%, respectively — not to mention the average of $70 a month that Comcast takes in from South Jersey subscribers. “We’re seeing huge numbers on all the product lines,” Doyle adds. Doyle says that his job, which includes overseeing the management of just over 5 million video subscribers in Comcast’s Eastern division (its largest), is to make sure he has the right people in the right jobs, “and to make sure they are thinking of new ways to offer our products.” In South Jersey, the right person is Amy Smith, a rising star in the Comcast firmament who started in the company nine years ago as a business manager in Charleston, S.C. Smith “combines certain ingredients,” Doyle says. “No. 1, she’s very smart. She’s very aggressive, she knows how Comcast runs its businesses and she’s very good with people.” Although very decentralized, Comcast is also very standardized. Management teams are structured so they “have control of their own destiny,” Doyle says. In South Jersey, that meant some changes were made when Smith came aboard. One of the first things she did was institute a review of all processes and procedures. Procedures in Cherry Hill were very different from those in Vineland, for example. That led to confusion, especially for the customer account executives (a.k.a. customer service reps). Where it made sense, those procedures were standardized. They also have two key members of the tech team working closely with the call center to ensure the two teams are in sync. Smith’s philosophy is simple: take great care of the customers and take great care of the people who work for her. On the service front, Comcast is making the capital investment to expand its customer service and ensure the reliability of its video and associated services. The new service assurance center, slated for completion this month, will provide round-the-clock tech operations support, enabling technicians to troubleshoot issues before they affect customers. The company has also expanded a 42,500-square-foot call center it initially opened in August 2001 by another 30,000 feet. Some 115 new reps are being hired and trained on Comtrac, Comcast’s customized customer database. Smith’s team approach extends to the customer service reps. One program that was conceived in the Voorhees call center is called WOW — Working in an Outstanding Way. The WOW logo, designed by an employee, is emblazoned all over the call center and on employee T-shirts; the idea behind the campaign is to generate ideas from employees on how the company can “wow” customers on a daily basis. Being so close to Comcast’s corporate headquarters also gives the employees and managers in South Jersey a way to be more involved in the company’s future. While working in the shadow of Comcast Cable president Steve Burke and Comcast CEO Brian Roberts can be somewhat stressful in terms of “knowing that everything you do is going to be scrutinized,” Smith acknowledges, it also gives the division more resources and assistance — and the ability to participate in tests. One recent test was a technical meter that South Jersey technicians tried out, a product that would give the technician the ability to see all of the technical specifications of a customer’s service while interfacing with the billing system at the same time. Ultimately such a meter would allow the techs to upsell customers or complete certain tasks more quickly. Smith shares Mike Doyle’s passion for getting the new products out to customers. With high penetration rates already, the question is how to get to the next level. Digital is marketed “very aggressively” according to Arnold. Only three packages are sold — gold, silver and platinum — and the higher level package a customer takes, the better the discounting is. If digital is a great sales tool, then VOD might well be the clincher. The division has 270,000 digital cable subscribers, or 43% penetration, and expects to end this year with 45% digital penetration. Granted, most of Comcast’s VOD offering consists of free-on-demand content, but over 60% of the digital subs have tried VOD, and Smith says that over 90% of those customers have become repeat customers. The stat thrown out by Doyle is that the average digital customer has used VOD eight to 10 times a month. “We’re seeing a pattern where people really gravitate to VOD,” Doyle says. “It’s a category for us that just keeps growing.” Not only does VOD help reduce churn, but it “helps us drive deeper into the market,” Smith says. The stats “are a tremendous indication of how the product has been received.” Doyle is especially pumped about the potential for high-speed Internet service. In South Jersey, Comcast has signed up 135,000 HSD customers, for a penetration rate of about 22% of basic customers. Doyle attributes the high take rates not only to the numerous messages that customers see but also to word of mouth. Despite that higher-than-industry-average stat, Doyle says there is plenty of room for growth. “With 65% of Americans still using dial-up there is a huge growth opportunity for this industry.” As far as strategy, Doyle says Comcast will keep doing what is has been doing. “We have always been very aggressive bringing new customers in the door.” The current enticing offer is six months of high-speed Internet service for $19.95 a month. Hi-def TV is another big growth area. The division counts about 8,300 HDTV customers, and anticipates ending the year with about 17,000. Comcast has HD agreements with some retailers in South Jersey, and also has kiosks set up in malls so potential customers can see HD up close. These kiosks are in the process of being upgraded, Arnold says. So what else is in the pipeline on the product side? Arnold says they are naturally looking at home networking and cable telephony, but stresses (as have his bosses Steve Burke and company co-CFO John Alchin) that the focus of the company is to get all the systems on the same page and to have the ability to roll out products on a companywide basis. That means completing upgrades of the recently acquired AT&T Broadband systems. This hasn’t stopped the company from testing, however: Currently Comcast has a VoIP trial ongoing in Chester, Penn. Northern New Jersey has had a tougher fight against satellite than southern New Jersey, due to the recently ended imbroglio between Cablevision Systems and the YES Network. Comcast, which was showing YES in northern New Jersey, was apparently tainted by the feud, which led to thousands of Cablevision customer defections. While customers defected from Comcast as well, the company has instituted an aggressive dish buyback campaign that has netted 1,200 customers so far this year throughout the state, according to Arnold. Satellite customers that turn in their dishes receive $400 in credit over 16 months, or $25 a month. Smith and her marketing team, led by Maureen Dalton, have to be innovative in the way they market new services because of the sheer diversity of South Jersey: There is urban Camden, semirural Vineland and the seasonal shore communities of Avalon, Wildwood and Atlantic City. Comcast looks hard at the needs of each community, and tries to tailor products to them. At the shore, for example, the thrust is on keeping customers at least on a lifeline cable service throughout the winter, while in Atlantic City, each casino is wired with its own fiber to ensure the high degree of reliability that’s needed there. In fast-growing Vineland, there are teams working with builders and developers. Smith knew that partnering with developers would be a key to her success, and so she focused on it. In some of the new developments where Comcast has partnered with the builders, cable penetration is up to about 90%, she says. Comcast also leverages the large amount of advertising inventory it controls on a few dozen cable channels. As Doyle explains it, the company controls the advertising inventory and divvies it out to ad sales depending on how much advertising is sold each month, rather than vice versa. By doing so, Comcast has ensured that Comcast ads are placed in cherry spots. “We don’t handle this casually,” Doyle says, noting that system managers meet with the ad trafficking department each month to set a new schedule of Comcast ads based on how the ad sales department fared. Doyle adds that it is not uncommon for Comcast to commandeer some 28% of its ad inventory to promote its own products, and up to 35% of that inventory during a slow month. On the advertising front, Mike Wall oversees a staff of 28 in South Jersey who pitch both on a local and a regional level. It’s not so easy, but because of the growth and potential of the company, the ad sales division has been able to attract higher caliber sales talent than your run-of-the-mill cable operator. In fact, Wall says, Comcast has recently lured two former general sales managers from network affiliate stations in Philadelphia. “The people we’ve been able to attract to our business have skill sets that are far ahead of what we could have attracted four or five years ago,” he says. That’s a good thing because the business is that much more complicated. The ad sales reps need to be able to sell Comcast to the local mom- and-pop retailers throughout a broad area as well as to advertisers looking to reach a far broader geographic area. In this arena, the salespeople have to be able to rattle off stats on the 36 zones that can exist in the Philadelphia/York/Harrisburg/Lancaster regions. They also need to be able to walk into an ad agency and whip up a pitch that’s competitive on a price basis with anything the broadcasters can deliver. Wall says he has noticed a change in advertisers’ perception toward cable in recent years, evidenced by the way advertisers are spending money with the company. Ad sales in Philly grew 20% last year, he says, but the growth was not fueled by an overall increase in the number of advertisers. Rather, he explains, nearly all of the current advertisers spent more. This year’s challenge will be to grow vertically, by having each advertiser spend a little more, as well as to add to the number of advertisers that view cable as a viable medium. One plus is being able to offer an advertiser coverage of the entire state of New Jersey. While the locals quite often identify with Philadelphia, it’s a little different with the advertisers, who want to make sure they’re getting as much bang for their buck as possible. From that standpoint, it’s easy to pitch against the Philadelphia radio stations, which count large parts of Delaware and the suburbs west of the city in their coverage areas. To an advertiser, that can be a waste. As Wall says, the Delaware River “can be 20 miles wide from a perception standpoint.” EMPLOYEES: 1,100 HOMES PASSED: 835,000 MILES OF PLANT: 20,046 PERCENT UPGRADED: 100% BASIC CABLE SUBSCRIBERS: 620,000 BASIC CABLE RATES: $8.62 to $12.15 DIGITAL CABLE SUBSCRIBERS: 270,000 DIGITAL RATES: $9.95 over expanded basic rate HIGH-SPEED INTERNET RATES: $42.95 VOD: Available to 100% of market HDTV: Available to 100% of market (package includes ABC, NBC, PBS, HBO, Comcast SportsNet and Showtime) AD INSERTION: 34 channels SOURCE: COMCAST A CPA, Smith joined Comcast nine years ago as a business manager in Charleston, S.C. From there she became VP/GM of the Chester and Lancaster, Penn., systems. Since coming to South Jersey a year ago, she has been responsible for everything from customer service to engineering to new service launches, and has played a critical role in expanding the region’s call center. Wall joined Comcast three years ago as director of local ad sales for Philadelphia. Previously he was GSM for Cable AdCom and also held the position of VP/GM of Target Select Cable Advertising before moving on to become director of retail sales for Radius Communications. Taylor has worked in cable since 1982 and most recently served as VP/GM for Comcast’s New Castle, Del., system. Before coming to Comcast in January 2000, he was regional director for operations for Suburban Cable. A 21-year cable veteran, Dalton previously served as area marketing director for Comcast in North Jersey. Before joining Comcast, she was with Storer Cable, TKR Cable and Continental Cablevision. Rowello comes to Comcast from the management consulting firm Pittiglio Rabin Todd & McGrath, where he served as principal of the telecom group. He oversees 300 employees at the company’s call center. Roundtree is responsible for managing all accounting, asset management, compliance and internal control functions. Prior to his current position, he was the general manager for the 200,000-subscriber system in Chester and Lancaster counties in Pennsylvania. He joined Comcast in 2000 as director of business operations. Comparison of consumers in Comcast’s southern New Jersey service area to the top 75 market average.

The Daily

Subscribe

Obituary: Ron Wolfe

Charter engineer Ron Wolfe passed away Nov 25 after a month-long battle with COVID-19, according to his obituary.

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