There is much truth to the notion that "email was the killer app for dial-up." There may also be some truth to the notion that "voice is the killer app for broadband." At least that seems to be a developing theme for SureWest (News - Alert) Communications.

 

"The newly released Voice over IP product remains one of the most exciting services we've ever launched," says SureWest CEO Steve Oldham. "Customers are attracted to its advanced online and interactive technology, over 20 easy to use features, cost effectiveness, and reliability," Oldham says.

 

SureWest benefits by selling more bundled triple-play services with the offering, thereby enhancing overall subscriber margins. "We have converted nearly 2,900 customers from the telecom voice product to the new broadband Voice over IP service since its launch earlier this year," he says. "And of those converted customers, over 20 percent added SureWest Internet with their phone service, and over 10 percent added TV."

 

In other words, VoIP has driven buying of other key services as well, especially broadband Internet access and IPTV (News - Alert). SureWest broadband residential voice RGUs increased seven percent year-over-year and five percent sequentially. In the original Sacramento region, voice RGU growth was 18 percent year-over-year and 13 percent sequentially.

 

"Voice over IP is proving to be a proactive marketing tool for SureWest in offsetting traditional telephone access line losses reflected by our consolidated voice RGUs, which decreased by 1,000 sequentially, or one percent, compared to a sequential loss of 3,100 in the prior year quarter," says Oldham. "It has also offset year-over-year losses in consolidated voice RGUs by two percent, resulting in a five percent year-over-year decline, compared to a seven percent decline without this new service."

 

"We're not immune to today's economic environment," says Steve Oldham, SureWest Communications (News - Alert) CEO "We have found that customers havebecome more value conscious. However, we have not seen customers giving up broadband voice, video and data services as a result of the economy." On the other hand, SureWest will acceleate offering of promotions to offset expected weaker demand.

 

SureWest did not see much of that weakness in the most-recent quarter, though. It grew broadband and residential RGUs by nine percent year-over-year and three percent sequentially, says Fred Arcuri, COO.

 

In its original Sacramento market, RGUs grew 16 percent year-over-year. Business growth was highlighted by a 26 percent year-over-year increase in broadband business revenues, to $9.3 million.