Cable giants tune in to small firms

CABLE GIANTS TUNE IN TO SMALL FIRMS
[SOURCE: Chicago Tribune 5/23, AUTHOR: Jon Van]
Big cable operators are targeting the small and medium-size business market in a fight for turf that phone companies have had to themselves until now. Companies such as Cox Communications Inc., Time Warner Inc. and now Comcast Corp. have recently announced that they will provide small businesses with voice and data services, a potentially lucrative market that can bring three to four times as much revenue per customer as residential services. A recent study by The Insight Research Corp. noted that among an estimated 7 million small businesses located in the United States, about 6.4 million are located in areas served by cable TV. "Serving this market is a no-brainer for the cable industry," said Robert Rosenberg, president of Insight. "For the same effort it takes to win a residential customer that you may send monthly bills of $40 you can win a business customer whose monthly bill might be $200." For small-business customers the increased competition will likely lead to more choices and better prices, Rosenberg said. But the fierce competition could translate into lost revenues for phone companies. According to Insight, phone companies are expected to lose more than 1.5 million small-business phone lines to cable competitors by the close of this year and nearly 10 million small-business phone lines over the next five years. Cable companies already have had success in luring away residential customers from phone companies. Time Warner claims to have 2.1 million residential phone customers in its first three years and began selling phone services last month to small and medium-size customers in five cities.
http://www.chicagotribune.com/technology/chi-wed_comcastmay23,1,914515,p...