Business

On the Hot Seat

Cable provider RCN banks on better service to drive growth

John Ioven/Globe Staff

Jeff Carlson,

general manager,

RCN Boston

RCN is Boston’s other cable television company, accessible to only one-third of Boston households, but serving about 20,000 customers in the city. RCN Boston’s general manager, Jeff Carlson, has a yen to get bigger, and a plan to make it happen. He laid it out for Globe technology reporter Hiawatha Bray.

How do you plan to build your subscriber base?

My job is to take care of the customer, and over the past 20 months, that’s exactly what we’ve gone about doing. Just completely reinventing RCN, reinventing the customer experience, and probably most notably, upgrading our infrastructure, our network architecture, and obviously our data speeds.

How do you improve the customer experience?

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We onshored our phone calls. One of the biggest problems we heard from our customers is that they were being answered in the Philippines. We set up locally a loyalty organization, where their whole focus is outreach to our existing customer base.

How many jobs did that create in the US?

I would say about 120.

OK. What else?

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Through the first three quarters of 2011, we finished our upgrade to the DOCSIS 3 platform, the protocol that allows enhanced [Internet] speeds. We knew our customers needed a more reliable and more robust data product. After this upgrade, we took our existing customers who were at 5 and 10 megabits a second [and] brought all of them to 20 megabits at no additional charge.

Can you match the recent 300 megabit service offer from Verizon and Comcast’s 305 megabits?

Absolutely. And I think that is in the cards for 2013. Price points and market targets not particularly decided at this point. But Feb. 1, we took all the people we had moved to 20 megabits and moved them all up to 25 megabits. We also then introduced two higher speeds: 50 megabytes and 75 megabytes.

When will you offer service to more parts of Boston?

In terms of expanding the footprint, that is not our focus right now. After we’ve made the investment in terms of intellectual energy and capital into upgrading the network, it opens up the likelihood for us to increase market share within our existing footprint.

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We feel like we had a very good 2011. Our video customers contracted by about 2½ percent, which we feel pretty good about. We slowed video erosion.

How many customers had you been losing before that?

Up to 5 or 6 percent a year. We didn’t really have a robust data product in 2011, and we’ve fixed that. Overall our customer base was flat, when you add our data clients. So basically, we stabilized our customer base in 2011. We expect to gain video customers this year.

Your rival, Comcast, recently began offering the TiVo video recorder system as an option, but RCN has offered TiVo for a couple of years. How’s it working for you?

TiVo has been shown to be what we call in the industry a very sticky product. When it’s in the home, people keep it. TiVo’s running about 25 percent of our connects, and for the videophile, they are the product to have.

Some data suggest consumers are cutting cable to save money. How do you hang onto those customers?

We have a cord cutter offer at $39.99. You get basic cable and 25 megabits of data, which you can upgrade to 50 megs for 10 more dollars.

Video is our core business. It’s going to remain our core business for a long, long time. But we’re not making our future dependent on the prevalence of traditional video delivery. The thrust of our near-term strategy is data and TiVo. That’s where we think we can get the biggest lift in consumer satisfaction. Clearly that’s what 2012 has been all about and 2013 [will be] the same. We’ll probably be looking to push the speed and our bandwidth capabilities up again.

Will you ever consider expanding to serve more of Boston?

The more that we convince ourselves that we can move the needle in terms of market share and customer satisfaction within our footprint, these other opportunities to expand are going to look a whole lot better.

Hiawatha Bray can be reached at bray@globe.com.
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