Cox Business 2009: 16 percent growth, $1B revenues

Visiting Fierce's offices in Washington D.C. last week, Cox Business was bullish on its prospects for the year. Over the past two years, the division of Cox Communications has grown at a rate of 16 percent year-over-year and anticipates continued growth of 16 percent this year with revenues of close to - if not equal to -- $1 billion by the end of 2009.

Cox Business defines the largest portion of its clientèle as the very small to medium-sized business. The 19 and fewer employee businesses currently make up 70 percent of the unit's business, and Cox Business plans to move up-market to target businesses with 20 to 99 employees. It also makes a healthy living providing wholesale services.

Phil Meeks, Vice President of Cox Business, said the company is "concerned, like everyone else," about the impact of the economic slowdown. "We're seeing in pockets a bit of a slowdown in buying activity," Meeks said. "The West Coast is more impacted. We're seeing fewer [phone] lines being bought, if businesses want more, they can call you later."

To meet its aggressive goals this year, Cox has a five-point strategy on how to capitalize on current conditions and "Get a bigger slice of a smaller pie," Meeks said. The first point of that strategy is to get a health mix of retail and wholesale revenues by capitalizing on big market opportunities such as wireless backhaul, putting carriers on its own fiber rings.  Building out more fiber also means generating more retail business opportunities as the infrastructure is deployed and passes potential customers.

Moving up market to the 20-99 employee business segment by providing new services over existing HFC plant is the second point. "There's a huge opportunity for us," said Meeks. "We're focusing on company verticals of health care, government, and education, where jobs are being grown, where government is putting money."  Meeks said the company is rolling out symmetrical T1s, PRIs, and Ethernet over HFC to reach the 20-99 segment; around 80 percent of such businesses are passed by HFC plant.

Point three is a strategic build of infrastructure in key markets. While the company serves 18 markets, it will concentrate on expanding in Northern Virginia, San Diego, Las Vegas, and Phoenix.

CBeyond and the RBOCS would be familiar with Cox's fourth tactic: Move customers from a single service and up-sell them to multiple services. "It's not capital intensive," said Meeks. "We've already built the infrastructure." With a base of 250,000 single product customers, there's a lot of room to upsell.

And the last point? "Plain old-fashioned optimal execution," Meeks stated. "We're a trusted provider, the best provider of data services in the SMB space [JD Power] by service, the care we provide... We're different, we have account teams, feet on the street in each market [selling]... It's all about execution.  We want to make sure prospects understand they're on the right products, the right bundles. By insuring they're on the right products, there's less overall technology spend for them."

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