Like its lucky, fleet-footed cartoon mascot, Road Runner appears to have eluded the broadband coyotes: It's emerged relatively unscathed from the canyon created by the America Online Inc.-Time Warner Inc. merger with a new look and added features.
That's a surprise to many observers. After Road Runner's ownership was consolidated under the newly merged AOL Time Warner Inc. earlier this year, analysts speculated that the data-over-cable service would be shuffled into AOL's burgeoning broadband Internet operations and disappear in all but name.
But the bird is alive and kicking, said Road Runner president Jeff King. It added 252,000 new subscribers in the third quarter, for a total of 1.7 million subscribers as of Sept. 30. Road Runner has stayed within the Time Warner Cable division and competes with sister Internet-service provider AOL for cable-modem customers in a growing number of multiple-ISP markets.
It also increasingly competes against independent ISPs, led by EarthLink Inc.
"We continue to be our own service," King said. "We have every expectation that Road Runner will continue to cultivate and retain customers, and we are sure other ISPs will be offered in additional markets throughout Time Warner.
"But we are going to be there as a competitive brand. Our agenda to grow aggressively has remained intact."
With a new slogan — "The Fun Starts Here" — Road Runner relaunched in late September, adding beefed-up features and a new desert-themed start-page design.
SURVEYED SUBS
The changes are based on Road Runner's first-ever survey of potential and existing customers. Those findings will take on added importance as Road Runner goes head-to-head with other ISPs, including AOL, according to King.
"I think that's how you stay involved with consumers," he said. "I think that's how you make sure the consumer that is using your service feels that you are up to date, that you are current with technology and the environment that they would like you to be in."
What did users want? Personalized start pages, among other things. So Road Runner has added tools that allow customers to set the news, sports and entertainment features that pop up on their start page.
It also added a feature that allows up to five household members to set an individualized password and start page, as well as remote access, which lets a customer view their personalized home page via any Internet connection.
Road Runner customers also wanted a better way to find broadband content.
"So you've got great connectivity and you can get all of these Web sites faster, but where's the beef — where's the broadband content?" asked Steve Cook, vice president of broadband programming. "What we did in terms of the redesign was bring everything to the top, to the home page. So everything is one click away, in terms of accessing broadband content."
That access comes via Media Runner, a video player built into the start page that spits out breaking headlines, video-on-demand clips and the obligatory multimedia-driven advertisements. Users can access available content from providers ranging from the Associated Press to Bravo.
"We are looking to our other partners within the Internet space, but also within the cable space, to create kind of a mini-programming wheel for the Media Runner, so people can get timely information and entertainment through their cable modems that is unique to cable-modem service — that you couldn't do over dial-up," Cook said.
TRAFFIC IS UP
Next to Media Runner is a local-content section, which also rated as a high priority in the customer survey.
The results: So far, so good. Traffic on the service's welcome screen is up 16 percent since the September relaunch.
In the first 12 days, more than 53,000 customized accounts were established, and total traffic for the first 10 days of October rose 46 percent compared to the first 10 days in September. King says that's a good omen.
"We still think the Internet is a very viable part of the industry, and we are going to be a major player," he said.
The service certainly has a shot at that, said Jupiter Research Inc. analyst Dylan Brooks. As Time Warner Cable adds more multiple-ISP markets, the relaunched Road Runner is in the running.
"They are, in a lot of ways … going to end up playing the incumbent role," Brooks observed. "They are actually in the catbird seat, and that can be either good or bad depending on your perspective, because they've got to defend against AOL, their corporate parent."
AOL has a track record of offering multiple brands on the dial-up side, specifically the flagship AOL service and CompuServe. So it's not surprising to see that philosophy extended into the broadband arena.
"Both in appearances, and somewhat in practice, it does give consumers a choice in terms of what kind of content do they get and who do they pay it to," Brooks said. "There basically hasn't been a compelling enough reason to kill off Road Runner."
