Changing Tunes In Music City USA

Cable World, Jan 6, 2003

Byline: STACI D. KRAMER

Nashville has moved far past the loopy, droopy country music capital portrayed in Robert Altman's classic film of the same name. Just as country music has evolved over time - think Shania Twain instead of Loretta Lynn - so has "Music City USA."

Today's Nashville boasts of its NFL Tennessee Titans and NHL Nashville Predators. Opryland has made way for Opry Mills, a retail-entertainment-dining complex, although the Grand Ole Opry and the Country Music Hall of Fame are doing just fine. At the same time, Nashville has moved up the list of preferred places to live and is a hot spot for corporate relocations; Dell, Saturn and Nissan all have a stake in the region. The cost of living may be below average, but the lifestyle is not.

This is the Nashville that serves as hub for Comcast Cable's Tennessee operations. Comcast's Nashville arm, with its 316,000 subscribers, is the state's largest cable system, fitting for the state's largest MSO.

Nashville encompasses an eight-county metro area. Driving I24 southeast toward Chattanooga offers a clear view of the growth, with new subdivisions popping up for commuters while towns like Murfreesboro pick up the trappings of cities. "You hardly know where Murfreesboro ends and Nashville begins," says Peggy Owen, EVP and management partner, the Buntin Group.

Comcast's Nashville system stretches far beyond the city. To the north, it steps over the Kentucky border into Ft. Campbell; to the south, it almost runs into Georgia. It includes two of the country's fastest-growing counties, Rutherford and Williamson.

As for the demographics, "the makeup of Nashville skews a little older," explains Dave Carter, Comcast GM of ad sales in Nashville and VP of the South Central area. "Not Pittsburgh old, not Naples-Ft. Meyers old. It's very white collar. You have the music industry, the financial industry, Saturn, Nissan." Nashville also has the highest income of the state's four major cities and an increasing Hispanic population.

The area's sprawling nature makes an advertising interconnect even more important than it might be in other systems. Just two years ago a media buyer trying to reach the whole area might have had to deal with as many as 18 different cable systems.

Comcast's ownership of the city's largest system - Charter Communications owns roughly one-third of the market - has its roots in AT&T Broadband's acquisition of part of InterMedia Partners in 1999. The system was then supposed to go to Comcast as part of a deal that took more than 18 months to conclude. The InterMedia name was retained in Nashville with Comcast officially taking over in May 2001.

Comcast kept a close eye on Nashville during the period between the InterMedia sale to AT&T Broadband and its own acquisition. Richard Rehme, director of business operations, jokes that the system had more Comcast representatives visit than AT&T. "They knew they were kind of baby-sitting," says Rehme, who recalls hearing Comcast Cable president Steve Burke say, "I've been to Nashville three times and don't even own the system."

In some respects Nashville provides a template for Comcast's current integration of AT&T's systems: upgrade facilities, invest in customer service, revamp marketing strategy and match programming to local interest.

The system's margins got an almost instant boost from contracts that switched from AT&T to Comcast, says Rehme. Today Nashville fits in with Comcast's average margin of 41%.

When Comcast raised rates an average 5.6% last fall, not only were CSRs equipped with the answers for concerned customers, Comcast conducted what director of marketing Lillian Graham calls a "ground-level gut campaign" internally to give everyone the right ammunition. "We all get the call. We all get put on the spot. If the call center can explain why and the receptionist can't, we have lost the customer."

Comcast's post-merger game of musical executive chairs left a gap in Nashville when GM Gene Shatlock was transferred to the Southern division in Atlanta as regional VP of marketing and customer care. Cable veteran Virgil Caudill, Shatlock's successor, actually came out of retirement to join Comcast late last year, lured by former Continental boss John Ridall, president of Comcast's Southern division.

At first, Caudill was nonplussed by the suggestion of Nashville as his next residence. "I said, 'Where?' I didn't realize Nashville was the 30th largest DMA. I had an image of the country music capital." All it took was a brief visit, dinner with Shatlock and a look at the system's potential to elicit a yes. In retrospect, says Caudill, "it was easy."

What Caudill didn't know until he made that visit was that former colleague Dave Sanders also was being interviewed for a job in Nashville. Sanders, who took the job of director of technical operations, lists autonomy, the spirit of Comcast and a sense that people in the company are very well rounded as appealing. "There's just an atmosphere of family in a large system. That's a huge draw for me," he says.