My thoughts on WideOpenWest (WOW!) buyout of Knology (formerly Sunflower Broadband)

Sadness

Oops, they did it again. Knology, formerly Sunflower Broadband, will soon be owned by WideOpenWest (WOW!) as has been reported both nationally and locally.

When reports first surfaced about Knology’s buyout of Sunflower, I was excited and later admitted I was wrong about my enthusiasm . Now that Knology is being sold to WOW! I have no optimism and about the situation and this will ultimately result in higher prices and continued job losses in the community.

In particular, WOW! is privately owned by Avista Capital Partners and the public aspects of Knology’s ownership I was so excited about is completely lost. Sunflower was a privately owned local company and we as Lawrencians had very little leverage to see change at the company. Knology being publically owned at least gave us an opportunity to formally get our voice heard.

From my initial research, WOW! sounds like a good company. They consistently win J.D. Power awards for customer service and are big industry player. Compared to Knology, pricing appears to be much higher. Taking Evansville, Indiana pricing as an example:

Knology’s Bronze internet is $19.95 with 3MB down and 256K up (and a cap of 3 gig)
WOW! minimum service is $40 with 2Mb down and 1Mb up (no bandwidth cap)

the fastest Internet service comparison is as follows

Knology’s Gold internet is $59.95 with 50Mb down and 1Mb up (and a cap of 250 gig)
WOW! fastest service is $90 with 50Mb down and 1MB up (no bandwidth cap)

As a vocal opponent of bandwidth caps, I’d like to see them removed in Lawrence but Knology didn’t remove them when they took over in Lawrence. This pricing is a major shock especially considering the cost of living in Evansville is lower than Lawrence. Given this information we can expect major price increases.

Theoretically a bigger cable company means more channels but Evanville’s lineup is pretty darn similiar to Knology of Kansas.

The impact to the local job market will be minimal after Knology “rightsized”. Left open according to the LJworld article is the status of Channel 6 news and though unmentioned in the article is the status on on-site computer support from Geeks on Wheels and the business computer support division. Obviously I’m very interested in what will happen to Geeks on Wheels and have a vested interested in the decision, but I do believe they’ll phase out these ancillary products. As a private company they will look to optimize and standardize operation. These divisions require a significant local presence that may not provide enough return on investment and would hinder standardization of WOW services in all markets.

Speaking of standardization, the LJworld article hints at, if not direct implies, that at some point our sunflower.com email addresses are going away. If you haven’t moved your important emails off of sunflower.com, now is the time. I warned about this back in January and I’m delighted Knology hasn’t forced a change. However I wouldn’t bet my important emails, especially my business related emails, on a hope that WOW! won’t make the change. Maintaining a separate email system unique to Lawrence will cost money and require additional management. WOW and Avista’s focus will be on maximizing profits and that requires more standardization and consolidation. Keep your eyes open for a special deal we will be offering to help you move from your sunflower.com email address.

This buyout signals the fundamental shift in how we receive information and entertainment. With Google Fiber coming to Kansas City, Google has already been approved to carry TV signals via IPTV. The business model of the cable company is becoming as old and antiquated as a “home phone.” As we shifted from radio to TV, dial-up to broadband, and landlines to wireless, the way we get these services will continue to change.

Cable companies as well as telecom providers like AT&T focus on packages and force us into little cubbyholes. Consumers prefer choices, plan and simple. Could you imagine the power company forcing you to pay extra for a “toaster” package because you want to make toast and coffee at the same time or making you buy your energy consumption in advance? That’s still the model of telecommunications and I think future generations will find that approach as archaic as having to use an “operator” to make a call (all apologies to Ernestine and no I did not make those calls to Topeka Kansas).

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