St. Louis-based Suddenlink Communications, with 1.2 million basic video subscribers, has had a strong year. It also posted strong third quarter results today, with overall revenue rising 7 percent. The MSO reported a net loss of $7.7 million, half as much as in the prior year period. Last month, CT reviewed network and service developments at Suddenlink with CTO Terry Cordova:
In what ways are you benefiting from having deployed a national backbone?
From the start, Suddenlink built a national backbone with centralized platforms to speed services deployment. We’ve been able to deploy telephone, VOD, provisioning, email and other platforms centrally. That, in turn, allowed for an efficient and economical deployment of new services and overall requires fewer network elements. We also focused on reliability and disaster recovery by building in geo-redundancy so a disaster at any single facility would not impact customers.
What areas can an MSO of your size effectively centralize?
Suddenlink had many standalone cable systems. By deploying region fiber to interconnect these systems back to our core backbone, we were able to economically bring new products and services to these markets, like DOCSIS 3.0 to 67 percent of basic subs by year-end 2009. Because these markets connect to our national backbone, we can leverage a very low cost of transit bandwidth and the fact that we are in most all of the major peering locations in the country. As a result of this consolidation strategy, today our top 15 headends cover approximately 90 percent of our subscriber base.
Suddenlink has announced a voice milestone this summer. What’s driving that business?
We began with only 30,000 telephone customers in a small percentage of the company’s total homes passed. Using our centralized soft-switch architecture, we grew our telephony homes-passed footprint by nearly five times in 15 months. Being on the front end of the growth curve and bundling the service with video and data helped drive us to over 250,000 customers by mid-August. Getting quality unlimited long-distance and local service in a bundle with video and Internet services all on one bill with one connection was a first for many customers.
Where do you find the biggest bang for buck in tech ops improvements?
Suddenlink has a top-to-bottom commitment to customer care. We not only manage to standard technical and customer care metrics, but also to a customer-focused metric called “Net Promoter” score. We know we’ve done well when a customer will refer us to their friends. Our success on this ultimate metric is a direct result of our focus on our own technical training coupled with our emphasis on SCTE certification. We also have built an automated birth certificate reporting tool that ensures all DOCSIS installs are top quality and return path quality is confirmed before we leave the home. We certify an entire home for existing and future services every time we enter. All of these efforts have helped us reduce our service calls per RGU, repeat service calls, and service calls within 30 days of install by significant levels.
How would you describe your business services opportunity?
SMB offers a large revenue opportunity. Triple play business customers generate three to four times the revenue as residential customers. Our new Business Class Phone (BCP) offers opportunity to further our relationship with SMB customers as we round out their data and video services. The BCP product lets us offer 24-plus lines, hunt groups, unified messaging, auto attendant and extension dialing to many businesses when we traditionally had a more limited product. We will be introducing PRIs and Ethernet over DOCSIS early next year. When we couple these new capabilities with others, such as long-haul carrier products and wireless backhaul, the outlook is very strong. Continuing to focus on the support of our offerings through our National NOC and Business Specific Customer Care will ensure we can keep the business we win.
What are some of your top priorities for the next year?
We’re constantly growing our competitive position with new services. By year-end we will have dramatically increased our DOCSIS 3.0 footprint and introduced VOD to about two-thirds of basic subscribers, and also will serve the majority of our customers with an average of 50 HD channels. We also will be increasing high-speed data speeds to the majority of our data customers at no additional cost to them. We feel that moving to tiers (downstream/upstream Mbps) of 10/1, 15/1.5, and 20/2 will continue to strategically differentiate us in the marketplace. We’re also introducing TV Caller ID, Speed Boost and local content on our VOD Platform. For 2010 we will continue to expand DOCSIS 3.0 and VOD footprints, and likely introduce a whole-home DVR solution. We will also continue to deploy digital simulcast and thereby facilitate an all-digital transition in support of the bandwidth required for the many new services that these systems will require.