Armed for the future—Today(2)
Sat, 12/31/2005 - 7:00pm
When heading onto the business battlefield, it's always prudent to arrive with the right weapon with which to smite your enemy. In the business of cable, which is doing battle with enemies on the ground (the telcos) and in the air (DBS), it's no longer about having the right weapon, but having munitions available for any given situation. That said, Rogers Communications, owner of the "quadruple-play" of video, data and wireline and mobile voice services, has an arsenal coveted by many of its peers. In addition to arming itself with the technologies and services required to win in Canada's fiercely competitive marketplace, Rogers also has some lessons to offer in the more intangible area of perception. Almost from the moment one boards an Air Canada plane bound for Toronto, it becomes abundantly clear that one is about to enter Rogers country. On the plane, a Rogers branding ad appears on the little screen, just before a vintage episode of "Frasier." Then, only moments after the wheels touch the ground at the Lester B. Pearson International Airport, the screen of a cell phone that typically shines back the Cingular brand is suddenly transformed to "Rogers Wireless." But the branding barrage doesn't stop there. Not even close. On the way to a hotel in downtown Toronto, chances are good one might pass by the Rogers Centre, home of Major League Baseball's Blue Jays and the Canadian Football League's Argonauts. Then, as a cab meanders through the frosty December streets, it's hard not to notice the red glow of the Rogers logo emanating from various corporate and retail buildings. From that point on, it's pretty clear what's going on here, and it causes one observer new to Toronto to ask another in a similar circumstance, "Rogers owns this town, doesn't it?" At least that's the perception, and an important one to deliver, considering what the operator is up against in Canada. If operators think they have their hands full south of the Canadian border, they haven't seen anything yet. In Canada, Rogers faces Bell Canada, a telco that has the all-important "quad-play." Most of its video comes by way of ExpressVu, Bell Canada's DBS division. And if that's not enough competition for you, also remember that Rogers has to cross swords with a cable colleague—Shaw Communications. Shaw also operates Star Choice, a DBS subsidiary. But Rogers has prepared itself for this competition, offering a swath of video, data, wireline voice, and mobile voice services (see "A glance," pg. 16). Rogers has become exactly the kind of company its MSO brethren in the U.S. are striving to become. Although many at Rogers have played an instrumental role in making these accomplishments a reality, CED has selected as its "Men of the Year" three individuals with this innovative operator that instill the passion and technical mettle that make the company special: Alexander Brock, vice president, technology and architecture development of Rogers Communications; Michael Lee, chief strategy officer of Rogers Communications; and Dermot O'Carroll, senior vice president, network engineering & operations for Rogers Cable Inc.Alexander Brock—Visions of convergence With multiple industries agog over the prospect of deploying IP Multimedia Subsystem (IMS) technology, it's good that the one guy who really, truly gets it is playing for the home team. Meet Alexander Brock, vice president, technology and architecture development for Rogers Communications. Brock can talk IMS from every angle (and in a dignified British accent, to boot). When asked what it is: "In its simplest form, it's an open, standardized, operator-friendly, next generation network architecture that is nicely agnostic. It's fixed; it's mobile. It transcends the applications environment. It's all IP; it's all SIP (Session Initiation Protocol)." A sample of Brock’s other passion – photography. Shown here, an island on the west coast of Greece.When asked why it matters: "IMS is a philosophy of change, because it means you're not building monolithic networks anymore," Brock relates. "You're saying, I have a cable network, and a wireless network, and a fixed line network, and they're all going IP. How can one integrate them to add value, and reduce operational expenses?" On the services front, IMS matters because it allows operators to really enable, for the first time, cross-platform services, QoS, authentication, encryption, and new concepts, like presence services, Brock explains. Ultimately, he argues, it makes the cable pipe more much valuable—and never "dumb." When it comes to the vendor hullabaloo around the topic—the supplier scene is bursting with "IMS solutions"—Brock is pragmatic. "I ask them (the vendors): What can you actually deliver today, and where would we put it, and what would it do?" In most cases, they fold. Indeed, buying IMS "is rather like being in a plane, and having to change the engine and parts of the fuselage—while it's flying," Brock says dryly. It needs to roll in without radically unseating existing technology investments, as a bridging technology between service silos. "Alex was one of the first of us to envision a seamless interface between cellular and PacketCable, and pushed the idea to CableLabs," says Steve Craddock, senior vice president, new media development for Comcast Corp. "This was years before IMS became the nouveau rage." Brock, who at one time thought he wanted to be a geologist, says his passion for telecommunications began "kind of by accident." While working toward his MBA at Durham University in the U.K., a friend suggested he look into the European telecommunications scene. His dissertation involved several months at the European Parliament and European Commission. "I was hooked," Brock says of the experience. "It was a very interesting time to enter the industry, with the emergence of digital cellular and mobile data." From there, Brock joined consulting firm Deloitte, "working mostly on wireless stuff" in a dozen countries in both Western and Eastern Europe, and then Toronto, with a stint in Hong Kong for good measure. "I bounced around a lot. The experience was very valuable." In 1994, Brock joined Rogers Cable to work on telephony and high-speed data. Over the past 11 years, he's worked in several other Rogers segments, including wireless and the parent/holding company. "Alexander is distinguished in the engineering community in that he is extremely competent in both business/product development, as well as being an informed technologist," says colleague Nick Hamilton-Piercy, a former CED Man of the Year. "His main vision, for the last half dozen years or so, is the convergence of wireless/cellular with cable," Hamilton-Piercy continues. Indeed, the notion of "convergence" (yes, that word is back) is one of Brock's top three priorities. Specifically, converged voice. That means fixed mobile convergence (FMC), which allows a customer to switch back and forth between the cellular network, and the in-home IP network, to lock on to the best possible signal. Brock's fingerprints are already evident in the fixed-mobile category: British Telecom and Rogers are chair and vice-chair, respectively, of the Fixed Mobile Convergence Alliance (www.thefmca.com). Early FMC trials were technologically successful, but handsets need to get smaller before the notion will attract consumers, Brock notes. Also on Brock's to-do list: converged wireline/wireless services for the business market. "They want seamless access, where the corporate voice and data network and cell phone work as one. It's a true wireless extension for both voice and data," Brock says. When asked to relate something that not many people know about him, Brock—who is shy in that proper way of the British—notes that he is half Greek, and can trace his family's roots (mother's side) all the way to Byzantium. "At some point, I will get the chance to do enough research to find out when and where my family came from—but it will take some time, since there's a thousand years of history to wade through." Until then, his off-duty passion is a 30-plus year obsession with landscape, architectural and candid photography. Three decades with a camera produced thousands of images—like the one shown here of Brock's ancestral homeland in Greece (see pg. 22). Up next: A two-week photo expedition to Iceland next summer (his second visit), with a native photographer as his guide. "It's the sort of thing where you literally do nothing for two weeks except take photographs—fabulous."Michael Lee: Analyzing on all levels Mike Lee and his dad (George) enjoy sailing in Halifax Harbor."I'm basically a math nerd," Lee says of himself. It's hard not to take his word on that account, judging by a component of his attire on this particular day—cufflinks made of real integrated circuits. Knowing that, it's no surprise to learn that he loves specifications, something that CableLabs offers in spades. "Things that don't have specs don't interest me," Lee explains. "I have no interest in DVD players. They're all the same." Of the trio, only Lee is a true Canadian native, having been born in Kapuskasing, a town in northern Ontario. His father, a pharmacist, then took the Lee family due south to Temagami, a small town, population 893. Following high school, Lee enrolled at the University of Toronto, where he studied computer science and statistics. Before moving to a job related to his college degree, Lee decided to enroll in cooking school, which fed his love of food and wine. But he soon discovered that he'd rather have someone else prepare the cuisine. "I haven't turned on the stove since '93. I eat out three meals a day, 365 days a year," Lee says. And, as a foodie, he knows where to find the most divine meals. In Toronto, we met him and the rest of the trio at one of Lee's favorite haunts. The wine list had the thickness of an NFL playbook. Lee also suggested we try the caribou tenderloin (and, yes, it was divine). Lee's first job out of college was in the banking and brokerage industry. Ironically, this career path led straight to interactive television, an area that would later define Lee's early tenure in the cable industry. "They were experimenting with iTV well before it was rational," he recalls. In this case, the bank was dabbling, appropriately, in TV-based banking applications. From there, Lee got a taste of the consulting world and then entered the realm of the dot-coms, joining a company called imoney.com in 1993. "We were early to market with respect to the consumer. It took some time to get all the banks to recognize the [Internet] model, then to participate," Lee says. Just when Lee was getting comfortable there, along came a call out of the blue. A headhunter contacted him about the Rogers media division. The pitch: they were looking for someone to focus on building a new business in the Internet space. Lee says two things attracted him: "One was: broadband was going to be absolutely critical, [an] important link in the chain. Two: Rogers has a legacy in being entrepreneurial, risk taking, new opportunities, and being early." Those reasons were enough to convince him to join the company, in 1998, as vice president of business development and technology. Lee later joined the Rogers cable division as VP of interactive television. It was about this time that Microsoft made a $400 million investment in Rogers. Among his first tasks and accomplishments: porting of the WebTV service to the S-A platform. Using the box's DAVIC (Digital Audio Video Council) channel, the service could achieve dial-up Internet equivalent speeds of 44 kbps to 56 kbps. Sharing the approach of WorldGate Communications in those days, Rogers used the platform to serve the "underserved"—people who were economically or technically disadvantaged. The problem? "That market doesn't really exist," at least not in sufficient volumes, Lee recalls. "But, it was a great experience. It allowed me to come into cable, but not have to learn all aspects [of the industry] immediately," says Lee, who then helped Rogers launch other interactive apps such as Wink. Those early experiences taught Lee and Rogers that interactive television had to have a direct linkage with what was being shown on the screen. "If it's not tied to TV, it won't be as successful," Lee says, noting that this is why video-on-demand and digital video recorders have resonated so well with consumers. Lee is now transitioning into his new role as chief strategy officer for Rogers Communications, where he gets a chance to look at all aspects of the company's businesses—cable, wireless, and media—and determine how they relate and where they should be integrated, or if they are better served as a standalone business. One example of this is Rogers' video store chain and the cable division's video-on-demand service. Although there are some potential conflicts of interest, Rogers sees the relationship of the two from a more pragmatic angle. "If you don't cannibalize yourself, someone else will," Lee says, noting that this perspective comes directly from company chief Edward "Ted" Rogers. Besides, DVD and VOD release windows continue to be different, so Rogers sees them as complementary. Lee's colleagues remark at his ability to view technology, not just for technology's sake, but how it will apply at the consumer level. "First of all, he understands the technology," says Arthur Orduna, the vice president of strategic initiatives at Advance/Newhouse Communications, the parent company of Bright House Networks. "But he marries it with a very strong consumer vision." Orduna, who has collaborated with Lee on CTAM events and CableLabs initiatives and "convergence" projects, said there's a lot for the industry to learn from the breadth of Lee's responsibilities as well as the scope of Rogers' business. "A lot of [big MSOs] tend to be more specialized," Orduna says, noting that video people are inclined to focus on video products, and high-speed data employees tend to zero in on just that part of the business. Rogers' approach "offers a good incentive to do a bit more cross-fertilization, so to speak, and more cross exposure for both the technologist and for the marketers in our companies." Among his priorities, Lee is applying the microscope to the so-called 2.0 version of the Web, whereby telecommunication and media distribution are changing, enabled by technology and consumers. He is also placing a laser focus on the consumer. "Clearly, the model is shifting to a much more consumer model than we've ever seen in the past. That means we have to look at services, product, distribution and technology—and say, 'Okay, how do we get to where the customer is going?'" That means a lot of observational research with customers, including traditional early adopters and even more aggressive technology "vanguards." As an anecdotal example, recent research has shown that consumers are beginning to connect their PCs to the TV very rapidly. "If that's what the customer wants, then we'd better figure out how to do it," Lee says.Dermot O'Carroll: It takes one to know one The O’Carroll clan: (From left) Dermot, daughters Aisling, Sorcha, Aoife, and wife, Breda.Dermot O'Carroll, the SVP of network engineering & operations for Rogers Cable Inc., knows precisely how vigorous Bell Canada can be as a competitor: He used to work there. "This is probably one of the most competitive markets anywhere," O'Carroll notes, because both entities offer voice, high-speed Internet, video, and wireless packages. "It drives everything we do." That means continually surveying customers, to see what they like and what they don't like. It means building high-speed Internet tiers that attract both dial-up and DSL appetites, offering more channels of HDTV, driving voice services deeper—and plugging a wireless spigot onto all three. O'Carroll's peers say he's just the guy for the task. "One of the outstanding things Dermot brings to Rogers is his previous telco background," says colleague and industry elder Nick Hamilton-Piercy (who calls O'Carroll "the crazy Irishman"). O'Carroll offers "a well-disciplined approach to engineering processes. His passion is in running ultra-reliable networks." O'Carroll's off-duty passions are just as notable. He studies karate at six in the morning, every morning but Thursdays. (For karate aficionados: He's a third-degree black belt.) He knows how to brandish a sword (and did so with gusto at the photo shoot that accompanied this article). He studies poetry. On his office wall hangs a framed poster, showing photographs of a dozen famous Irish writers. O'Carroll brags charmingly of his three daughters, Sorcha (26), Aoife (23) and Aisling (19), and says of his wife of 31 years, Breda: "She keeps me honest." Indeed, O'Carroll is the kind of Irishman that makes the Americanized Irish proud of their ancestry. (Especially when he grumbles about how North American bartenders don't know how to properly pour or serve a Guinness.) O'Carroll hails from the county Donegal, on the northwest coast. He moved to Canada in 1974, after studying engineering and electronics at the National University of Ireland, University College Dublin. ("I graduated on a Friday, and got married on a Saturday," he says.) He joined Bell Canada in 1975, working mostly on what were advanced technologies, at the time: Fiber optic deployments between central offices; digital switching, even teletext on TV. He sidestepped into financial management in the late '80s. "I looked around and said, 'What don't I know about our business? Capital management'." He liked the money side well enough, he says, but opted, in 1989, to make the move that would point him toward cable, and Rogers. "I got a call from CNCP (Canadian National Canadian Pacific), which provided telecommunication services to the railroads," O'Carroll explains. Rogers owned a 33 percent share, partly to build a competitive long distance telephone network using the railroad's rights of way. It was in 1995 that O'Carroll shifted over to Rogers Cable full time. His first job: To make the network two-way, in lockstep with market acceptance of high-speed Internet services. "I didn't know anything about cable," O'Carroll laughs. He credits Hamilton-Piercy for showing him the ropes: "He's a very good friend, and a great teacher." Rogers' plant is now built to 860 MHz in 90 percent of its footprint. Now, it's a matter of innovating—a mantra at the Canadian MSO. Two theories drive O'Carroll's engineering leadership. One is Zen-like; the other scientific enough to warrant consideration as a sort of "O'Carroll's Scaling Theorem." The Zen: That a company's greatest strength is also its greatest weakness. In an applied sense, O'Carroll was talking about the centralized nature of the Rogers network. "Ours is a single network," O'Carroll continues. "We own all our own inter-city fiber systems, and we have a single headend where we assemble and distribute content—so when we launch a new channel or service, we can launch everywhere, simultaneously." One nation, one headend: Strong in economics and competitive response time, "but if you ever had a disaster, you're in trouble," O'Carroll explains. That drove a plan to upgrade the company's nationwide SONET network, and apply redundancy mechanisms. And then there's the matter of network scale, which O'Carroll views as one of the bigger issues facing network operators today. "Whether it's the combining network, or switching capacity, or IP network capacity, it's a big challenge to anticipate scale. If you hit that wall, things can go wrong fast." Enter O'Carroll's second major theory. It goes like this: "Every time you increase your load by an order of magnitude, you need a fundamental change in either process or technology, to handle that increased load." To that end, O'Carroll lists network performance as his number-one priority, followed by increasing market share of IP-connected homes, and implementing advanced compression techniques. "We think it's hugely important to increase market share in IP homes, because the future is all about new digital and IP-based products," O'Carroll says. "As for advanced compression—it's all about delivering more HD channels." Currently, Rogers offers a hefty 32 channels of HDTV, "and we expect to have a lot more."Rogers: Focused on the long haul Just because it has the coveted quad-play, Rogers isn't about to lower its guard. "What makes us stronger is that our competitor is quite strong. We have a ton of respect for Bell Canada," Lee says. But Rogers hopes to stay ahead with its extensive slate of services and its approach to the market. And its dedication to innovation, which starts at the top. "It's one company, one brand, one vision, one way," Brock says. "What drives us is Ted's leadership," O'Carroll explains. "No matter what we do, and where we get to, when you're just about to sit back and say, 'Ah, good, we're done'—he has another challenge. It's always about never letting up. "Having someone like Ted, who never lets up, forces you to be your best." And that's no blarney. A Glance at the Rogers Arsenal Almost 6 million wireless voice and data customers. Its GSM/GRPS/EDGE network covers better than 93 percent of the Canadian population. Cable homes passed: 3.35 million. Internet subscribers: 1.08 million. Cable phone subs: 18,100. Rogers Cable launched VoIP on July 1, 2005. More phone: Also in July, Rogers purchased Call-Net, a deal that added more than 600,000 circuit-switched subs. Retail: Rogers owned 288 video stores at last count. Rogers leverages these outlets to sell services, distribute consumer electronics gear, and for on-site customer care. Rogers' media division owns more than 40 radio stations, a regional sports TV network, a TV shopping network, and over 65 publications. Other: Rogers uses an in-house billing platform called SuperSystem.