25 years ago our IRR/ROI (Internal Rate of Return/Return on Investment) formula was between 14-20 years. Today, with such scrutiny on how our industry in general manages its business (Especially on the heels and the likes of Enron, Worldgate, and Adelphia) the Wall St. analysts have been pretty harsh on the ratings and confidence. Take Cox and Comcast for EXAMPLE**. They both are notoriously smart in how they operate and produce results for both Wall St. and their respective shareholders. They focus on capital and operational dollars as well as genuine customer service to all subscribers. By being their best the systems continue to grow with additional revenue generating units. For example, winning back lost subscribers who went to the Dish Networks. This phenomenon is churning positive results. When the quality increases as well as spreading the word that their customer’s payments contribute to the local economy of their local community plus that they hire locally, plus that they pay local taxes etc. This is one of the last battle grounds where MSO’s are taking the battle to the competition.
In today's environment, three-five year ROI are not the exception but rather the rule. In doing so, these companies have been able to achieve the unthinkable i.e, FCF (Free Cash Flow). Paying down their debts faster than expected surely contributes to a higher confidence level and perception by all eyes upon them.
In our free market economy, just like dusty said that if Contractor X passes on a contract because the inherent rates won't satisfy their expected margins, then Contractor Y may be better suited to pick up the contract. How can they do this? Each company's overhead is an expense directly off-set by their profitability and revenue. The more posh or elegant or top heavy expenses that these companies have the greater margin (The costs of covering all of those expenses) becomes. So, what does this mean? With today's streamlining and cost cutting by the MSO to create a wider margin of operational cash-flow, in part they are forcing their partners (This being the cable contractors) to do the same. This clearly is a top-down strategy that is working.
** The comments above do not in any way represent the beliefs of those companies expressed in said example.
Re: any info on am broad band - Soap Box Stand
Member #: 14229
Registered: 1996-2001
Posted:
221
Name:
David M. Rosner
Name:
David M. Rosner
Company:
DR Telecom Consulting & Solar Energy Solutions
Occupation:
Telecom consultant & Solar EnergySolutions
Location:
Based out of CT
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