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Meet the System—Belmont/Laconia, N.H

In New Hampshire's Lakes Region, MetroCast Cablevision added three services last fall, and is getting ready to add Internet protocol phone service. Good thing, too, because Verizon's laying fiber to the south.

By Simon Applebaum

Every day, traveling to and from work in Belmont, N.H., Steve Murdough passes a Verizon telephone dispatching office--a none-too-subtle symbol of MetroCast Cablevision's competitive future.

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Murdough, VP and general manager for MetroCast's cable system in Belmont and Laconia, works midway up a hill from one of the main highways running through Belmont. Verizon, busy constructing fiber-to-the-premises networks around the country capable of delivering video signals and improved voice and high-speed data services, has a telephone dispatching office at the bottom of the hill. "It's hard to forget as you drive by that the 800-pound gorilla is right near you," he says. "You remember that you're in a competitive world. It's a reminder every morning."

In January, Verizon announced that it is building a FiOS (fiber optic services) network in Bedford, Epping, Salem and Portsmouth, N.H. Verizon FiOS spokesperson Sharon Cohen-Hagar says there are no plans at this point to build in Laconia or Belmont.

"All four communities are to the south or west of the MetroCast footprint," says Murdough. "However, that doesn't mean Verizon won't move into our area in the future. We fully expect them to. We see this next year or two as our opportunity to reinforce the MetroCast presence and image within the communities we provide service."

With DirecTV and EchoStar already on the scene, and Verizon waiting in the wings, MetroCast is rolling out advanced products to its central New Hampshire customers as quickly as possible. Over a three-month span last fall, MetroCast launched video on demand, high-definition TV and digital video recorders. Since then, the system has increased its VOD and HD channel capacity, and relaunched its MetroCast Online high-speed Internet service, which previously had been outsourced to Maine-based provider Great Works Internet. "We already face competition daily from Verizon with their DSL service and DBS for video subscribers," says Murdough. "I don't fear the current competition from either. It only makes us better as a company and the industry as a whole."

By late summer, MetroCast will have chosen a voice over Internet protocol infrastructure vendor; it's considering two companies, which Murdough declines to name. "Reliability is the most important technical consideration we have," says MetroCast regional tech operations manager Moira Campbell about the competing vendors. A trial run for VoIP phone service among employees and selected customers is planned for November or December; the general rollout begins early in 2006.

Murdough says that Verizon's activity to the south isn't forcing MetroCast to launch VoIP sooner than originally planned. "It's our schedule and our plan," Murdough adds. "Telephony is a natural evolution for us. If the technology works, we're confident VoIP can roll out on our timetable without any major problems."

A transition of plant infrastructure from analog/digital to all- digital/IP is way down the road. Murdough first wants to explore other ways to expand channel capacity beyond 860 MHz. "We need Comcast and Time Warner and Cox and the other big operators to develop the all-digital platform and refine it to the point where it's mainstream for any size operator," he says. "Given our size and scale, we need to be a follower in this area."

Part-Time Residents

MetroCast is developing a media campaign that directly pits it against its DBS rivals. The campaign, which marketing manager Jodie Gallant describes as uncovering "the truth behind the fine print" of DBS, breaks later this summer. The ads will tout the ways in which satellite hides costs and service flaws; for instance, they will point out how the competition charges for service visits while MetroCast doesn't.

Satellite penetration in the Belmont area is about 8%, double the estimated penetration in Laconia and vicinity, according to Media Business Corp. More than 500 Belmont and Laconia households take DBS, according to MBC.

Gallant is introducing VOD, hi-def and DVRs to part-time residents in Belmont, Laconia and the other cities in the state's Lakes Region who are returning for the summer. She's sending to those 6,000 households direct mail brochures with extensive descriptions of all three services as well as discounts on each service, including a free reconnection.

Belmont town administrator Don McClelland Sr. expects a good take rate among residents returning to Lake Winnipesaukee and nearby areas, based on MetroCast's reputation. "Most people will call us here at town hall when they get fed up with anybody," McClelland says. "I haven't had a citizen complain about their service for the last four years. The few calls we get about them are for rate information."

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Meet the System—Belmont/Laconia, N.H

Cable World, July 11, 2005

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