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November 2014

Dogfight in the Cloud: Time Warner Cable Maneuvers Its Ethernet & Bigger Footprint to Win Enterprise Biz

Dogfight in the Cloud: Time Warner Cable Maneuvers Its Ethernet & Bigger Footprint to Win Enterprise Biz

Mobile and cable broadband service are staples of modern life.  Yet on the consumer and small business side, let’s face it: fierce competition makes it harder than ever for telecoms to make a profit there.

So service provider competition is steadily shifting to a new battleground (or battle sky), namely, the cloud, IT, data center and inter-office connectivity needs of mid- to large-tier enterprises whose requirements are simply exploding in this massively networked world of ours.

In the U.S., of course, that market is largely owned by Verizon and AT&T, who for 30 or 40 years have shrewdly traded their regional access networks with each other to put a virtual lock on big enterprise accounts.  The wireline segment of Verizon alone did $14.7 billion of enterprise business in 2013.

But alas, no duopoly is safe today from the terrors of infotech, innovation, and the cloud.  So the stage is set for a terrific dogfight over enterprise accounts led by the MSOs and telcos who want a piece of this lucrative business.

Time Warner Cable, the $22 billion MSO, is leading the first wave of the attack.  It’s just launched a nation-wide Ethernet service and wrapped it with better SLAs and improved back office systems.  The goal: to migrate hundreds of mid-sized and large U.S. enterprises to its Big E services.

Here to explain its strategy is Jitesh Bhayani, Vice President of Product Management and Marketing.

Dan Baker: Jitesh, Time Warner Cable is no stranger to business accounts: your annual report says you serve 600,000 small businesses in the U.S.  But moving up-market to serve national mid-tier and larger enterprises puts in the gun sights of big rivals.

Jitesh Bhayani: Yes, Dan, this is a very exciting time for us.  Before, we’ve been more of a regional player.  For instance, we would sell a lot of Ethernet to state governments or large hospital systems.  These are still mid-market enterprises but they are geographically-focused.  And because our footprint was also geographically-focused we did well in those niches.

But we’ve expanded our footprint considerably, and as part of Comcast, provide an even better comprehensive solution on our own plant in 20 of the top 25 markets.  No matter where you are across the country, we can connect your locations, either on our own network footprint or using another carrier’s last mile access.

The demand for Ethernet is very high.  Large retail stores, for instance, want to connect their stores to track inventory, and they want Ethernet to connect all their stores and download information every night on the buying patterns of customers.

Many of our readers are following telecom back office systems and I understand that new systems and a customer portal are part of the new service.

Dan, we enhanced our BSS and built our own OSS system for the new service.  As far as the customer portal goes, well, that’s table stakes today.  Larger enterprises simply won‘t buy from you if you don’t have a portal.

The portal is critical for seeing how their circuits and service are doing.  If there’s something wrong with video conferencing, and you don‘t have a portal you’re blind to what’s going on with your network.  For example, you can see circuit level performance by location.  And you can track technical details like service availability, frame delays, frame loss ratio, utilization and many more.

Another key use of the portal is to track utilization: a network manager can see if they are reaching a certain threshold that calls for upgrading their network.

Let’s say, you’re a bank with a 5 Meg circuit connecting your branch office in Toledo to your main office in Indianapolis.  Now if usage on that network increased and you’re seeing a consistent 90%+ utilization rate, you can immediately upgrade that connection to 10 Meg.  You don‘t have to wait until something breaks down to augment your network.

Incumbents like AT&T, Verizon, CenturyLink and Sprint really have an advantage with their wide deployments of legacy access technologies.

Certainly, the incumbent ILECs have a wide deployment of T1 and other access technologies like Frame Relay and ATM to offer Wide Area Network (WAN) solutions, but a number of enterprises are looking to move to a more scalable and cost effective WAN solution using Ethernet.

At Time Warner Cable we are investing in building out our fiber and hybrid fiber coax (HFC) network within our footprint.  We have roughly 80,000 fiber-lit buildings and 835,000 DOCSIS-equipped, HFC-connected buildings within our footprint where we can offer Ethernet services.  In addition, we have 130 external network-to-network interfaces (NNI) agreements with over 25 alternate access provider partners to provide last-mile access outside of our footprint.

An added advantage of our Ethernet offering over legacy TDM technologies is our ability to scale up to 10 Gbps in our fiber connected buildings and up to 10 Mbps in our HFC connected buildings without the need for additional equipment.

Jitesh, thanks for sharing your strategy.  Sounds like your enhanced Ethernet platform and expanded footprint is the ticket to some nice new business.

Yes, we think we are well-positioned to serve mid-market and larger enterprises now.  We already have a lot of experience offering Ethernet services for 8 years now in our Metro (city level) and Regional markets (mostly state level).  And our new MEF CE 2.0 certification in January and enhanced SLAs announced in June (that include tighter metrics and credits) gives us the momentum to attract nationwide accounts in a big way.

Copyright 2014 Black Swan Telecom Journal


About the Expert

Jitesh Bhayani

Jitesh Bhayani

Jitesh Bhayani is Vice President of Data and Carrier Product Management for Business Services at Time Warner Cable.  Managing the company’s data and carrier services product portfolio, he is responsible for product lifecycles, roadmaps,  and performance across various sales channels.

Jitesh joined Time Warner Cable in 2009 as Vice President of Marketing for Time Warner Cable Business Class, where he managed the Mid-West Region’s marketing and product organization as well as in-bound and out-bound marketing activities.

Prior to Time Warner Cable, he served as Director of Product Management at Charter Communications managing the high-speed internet product line.  His career also includes product development positions at Commonwealth Telephone Enterprises, XO Communications and Choicecom Communications.

Jitesh graduated with a Business degree from the University of Texas and holds an MBA from the Kellogg School of Management at Northwestern University.

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