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Jim Barthold
Cable television is an acquired taste. You might spit it out the first time you try it, but, with a little high-speed data and telephony seasoning, it tastes a whole lot better the second time you take a bite.
At least that's what Reliant Energy is finding as it moves back into the business for the first time since mid-1995, when it sold its Houston cable TV franchise to Time Warner Cable.
The Houston-based energy services and energy delivery company has sunk $25 million into an equity investment in Grande Communications, a Central Texas-based competitive services provider - or overbuilder - that's constructing a bundled voice, video and data network in Reliant's stomping grounds.
"We consider this a broadband network, not a cable network," says Tom Glanville, president-Reliant Energy Ventures.
That, it seems, makes all the difference in the world.
"We have no intention of getting into what's broadly defined as content," he adds. "There are many potential avenues under which we will want to access our customers, and a relationship with Grande can certainly help us."
It's a good time to diversify, and broadband seems to be the place that makes the most sense. Arguably, it did not make sense the first time around when cable meant cable TV.
"The world has changed," says a Reliant spokesperson. "Back then you really didn't see all these businesses converging to the degree they are now. It was a totally different world."
Everything's changed, come to think of it. Reliant, itself, like so many energy behemoths, is increasingly feeling deregulation's scythe brushing the hairs on its neck.
"When you think about what Reliant does, we run networks," Glanville says. "We run a gas delivery network. We run an electricity delivery network. We run a wholesale power and gas trading network."
Now, along with Grande, it will be part of a broadband communications network.
"We looked at a number of players in this arena. What we saw with Grande was an experienced management team that had been successful in this kind of network build in the Southeast," Glanville says.
Then there's the technology ... no small matter when it comes to investing what amounts to something more than pocket change, even for a multi-billion-dollar firm like Reliant.
"Grande is going to be able to supply high quality broadband services to their customers because it's a very deep fiber build," he says. "They're going to be competitive in the broadband market."
Finally there's the intangibility - unless you're a Texan - of "pardnering" with another company.
"We said, `Gosh, these guys are focused on Texas. Texas is our core market. Their customers are our customers,'" he says. "We saw lots of potential synergies in working with them as they rolled out their network in the state of Texas."
As Grande continues to build a deep-fiber network, it will have a deep-pocketed "pardner" along for the ride, one with special interest in the next community Grande's approaching.
In August, the overbuilder was given a 15-year contract to provide digital and analog cable services within the Houston city limits.
For Reliant, it means you can go home again.
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