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High-Speed Customers To Get Soft Sell

by jon lafayette

BroadJump is putting more sell into self-install.

The Austin, Texas-based company, whose Virtual Truck installation software is used by cable operators to get new cable-modem customers online cheaply, has a new product that gives MSOs an opportunity to sell additional computer-related products and services to subscribers.

With BroadJump's ChannelDirect, product offerings are made to customers while they're ordering, installing and using high-speed data services. For example, a new cable-modem customer might be offered virus protection or firewall programs from a vendor like McAfee.com Corp. ?[Cable operators are] able to offer products the customer wants during the installation of the service,? says Matt Tormollen, VP-marketing at BroadJump.

The operator and the vendor split the proceeds, adding a new revenue stream that increases the return on investment for operators that have upgraded their systems to support digital services, Tormollen says.

The software also adjusts which products are offered to each customer based on information gathered during online interactions.

Tormollen says ChannelDirect is being offered as an add-on to its installation product at no additional charge. The company makes money by taking a flat fee for each order.

BroadJump charges a $10 to $20 per-use license fee for its software, which is used by both MSOs selling cable modems and by phone companies selling dedicated subscriber line (DSL) service. The license fees are prepaid, usually in blocks of 500,000 to 2 million for each service provider.

The first ChannelDirect customer is BellSouth, which used BroadJump software to install its FastAccess Internet service.

Tormollen says Broadjump's cable clients, which include Adelphia Communications, AT&T Broadband, Charter Communications and Time Warner Cable, have also expressed interest.

Analyst Michael Harris, president of Kinetics Strategies of Phoenix, said it makes sense for cable operators to leverage their platform to generate incremental revenue without further capital expenditures.

Harris says operators will probably first use a product like ChannelDirect to cross-sell their other products, like digital cable or premium channels.

But some may hesitate at offering third-party computer services because they don't want to share the revenue. ?A turnkey offering limits their upside,? Harris says. ?Some will say yes, and some will want to wait? until they can create their own computer-related products.

Some cable operators may also want to wait until the situation with high-speed-access provider Excite is straightened out, Harris added. BroadJump is making software that helps operators migrate customers to other ISPs.

BroadJump's software is used to install about 12,000 new broadband subscribers daily. Its customers represent more than 60% of the North American broadband subscriber base. In addition to Virtual Truck, BroadJump's products include CorrectConnect, which helps high-speed customers manage their bandwidth requirements. The company's programs are often rebranded by service providers, such as Time Warner Cable, which offers CorrectConnect as Road Runner Medic.

The 3-year-old, privately held company has been growing quickly as more cable modems are sold at retail, requiring self-installation. The company says revenues are expected to jump tenfold this year, and analysts place those revenues in the $20 million range.

In July, the company raised $22 million in financing from strategic investments made by SBC Communications, BellSouth and Nortel Network.

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