MI-Connection manager see 12% revenue growth in 2011-12
by Staff Writer
DAVIDSON – Calling next year’s budget “conservative,” MI-Connection General Manager Alan Hall, nonetheless, projects revenue growth of 12.6 percent for the fiscal year starting July 1.
Hall’s optimistic estimates come at the end of a year when the broadband company operated by Mooresville and Davidson had to greatly revise its revenue projections down, from 10 percent on July 1, 2010, to the current anticipated 4.8 percent growth at the end of the current fiscal year.
Nonetheless, Hall told the MI-Connection board of directors, meeting at Davidson Town Hall on Thursday, May 26, that he believes the organization can achieve that revenue with strong sales to local businesses. Business sales have fueled the company’s growth this year, even after MI-Connection lost six apartment complexes – and roughly 500 customers – last fall to competitors.
“I believe we have a growth engine built into this budget,” he told board members. The budget includes:
• Adding four sales people incrementally through the coming budget year.
• Adding two in-the-field auditors. The auditors will follow service crews and verify that only paying customers are getting service and that those customers are getting the services for which they pay. But they’ll also identify neighborhoods where MI-Connection can look for customers, such as streets that have a lot of satellite dishes. MI-Connection has had success with a introductory incentive for residents who turn in their satellite dishes.
The company also will see more revenue from a $4.50 rate increase that only took effect in April, Hall said.
The budget projects 10 percent growth in video revenue, from $9.6 million this year to $10.6 million in 2012. Hall is counting on new customers like the residents of Lake Norman Cove at Jetton in Cornelius, where MI Connection is installing data to homes now.
Hall also anticipates $634,743 (14 percent) growth in Internet/data service, which would include more business customers, and $349,567 (34 percent) growth in telephone service, the third leg of MI-Connections’ Triple Play services.
The board held a public hearing on the budget Thursday but only one person, Davidson resident Callan Bryan, attended or spoke. Like members of the board, Bryan questioned Hall’s optimistic revenue projection given the increasingly competitive nature of the Internet communication business. Bryan also questioned if MI-Connection has the capacity to handle increased demand for data capacity from businesses.
Hall assured Bryan and the board the company has purchased greater capacity in the current year and is already is switching to new equipment and a new Internet service provider to handle any data demands businesses might make.
Also Thursday, consultant David Auger updated the board on MI-Connection’s transition to take over most of its operations from Bristol Virginia Utilities. The Virginia utility currently provides almost all MI-Connection services, and most of the people providing MI-Connection services at its Mooresville headquarters still work for that utility.
That all changes July 1, when 30 of the employees switch to MI Connection Communications System, an interlocal agency created by the two towns. Then, from July through September, MI-Connection will hire 16 new employees, including its own controller, and gradually take over all but backup services from Bristol Virginia Utilities.
After Oct. 1, the Virginia utility will continue serving as a consultant.
Auger and John Venzon, chairman of the MI-Connection board, reported meeting with the Bristol employees who will be switching to MI-Connection and found they are “positive and motivated” to make the broadband company succeed.
“I told them that if they care of our customers, we’ll take care of them,” Venzon said, and he reported many employees thanking him personally for the switch.