Hawaiian non-profit customers of Time Warner Cable are receiving letters warning the cable company is terminating its discount program for charitable and community groups that could result in rates more than doubling for some customers.

Oceanic Time Warner Cable had provided free or heavily discounted cable or Internet service to qualifying organizations. Those discounts are ending, explains a letter obtained by Pacific Business News.

Time Warner Cable has adopted new policies regarding discounted or free service in light of IRS regulations that require 1099 forms to formalize the value of discounts or forgiven cable bills. The cable company is using the occasion to review its discount programs – ending some while tightening requirements for others.

“If we do not receive a reply from you within 30 days of this notice to update your account, it will be necessary for us to disconnect your existing services,” the letter explained.

Becky Dunning, managing director for the non-profit Honolulu Theatre for Youth called Time Warner to learn what “update your account” meant.

“The biggest thing is that when I called the number I was told that they aren’t offering discounted rates to nonprofits anymore, and that we’d have to pay their existing business rates; for our organization that means we would go from paying $106 a month to $227, which is a big difference — more than double,” Dunning said. “We can’t exist without Internet service.”

Dunning said the group would probably stay with Time Warner and attempt to make up the difference from somewhere in the organization’s budget.

Time Warner Cable believes it has room to raise broadband prices and get away with it without much customer backlash.

The cable company’s chief financial officer, Arthur Minson, raised the prospect of more price hikes at Tuesday’s Goldman Sachs 22nd Annual Communacopia Conference.

“Look, the modem [fee] was really just a form of a High Speed Data rate increase,” Minson said, referring to the company’s introduction of a $4 cable modem rental fee last fall and a later increase to around $6 a month introduced this summer. “I do see an ability for us to continue to have ARPU increases on that product.”

“ARPU” refers to the Average Revenue Per User — a term that reflects what companies earn in revenue divided by the number of customers. In most cases, an ARPU increase comes from price hikes or customers subscribing to additional value-added services.

Minson

Minson suggested that the company’s gradual rollout of optional usage-based pricing tiers provides an alternative for price-sensitive customers that cannot afford rate increases on flat-rate service or are seeking a price reduction.

“I think we’re very pleased with where we are in the usage-based pricing front and I think that’s something we will continue,” Minson concluded. “I think over time it will be interesting to see how many people ultimately take the usage-based pricing, or will people say I just want to have unlimited and I think the market will speak on that.”

Time Warner Cable has focused investment on several fronts this year, and plans continued investments to expand offerings in these key areas:

1. Business broadband expansion. Some of the company’s biggest investments target wiring businesses and office parks for cable service, primarily to expand commercial broadband. “Commercial services is success-based capital that we see real meaningful returns on,” Minson said.
2. Wi-Fi expansion. Time Warner Cable will continue expanding Wi-Fi hotspots in select cities. Customers with Standard (15/1Mbps) service or above can use the service for free. Minson said that the company was very happy to offer customers subscribed to unlimited use tiers free access to Wi-Fi. Not so for those choosing usage-based pricing plans. They will have to upgrade to an unlimited plan to get free access. “That’s a real incentive to drive people into the higher tiers,” Minson noted.
3. DOCSIS 3.1. Time Warner plans to adopt and invest in DOCSIS 3.1 cable modem technology when it is officially released. DOCSIS 3.1 will offer more efficient broadband transport and will let companies offer even faster speeds. Minson noted that broadband is increasingly the company’s anchor product, so it will continue investments accordingly.

Customers looking for aggressive pricing won’t find much at Time Warner Cable. Minson noted the company will continue its year-long pullback on low-priced promotions.

“We have a $79 bundle out in the marketplace and you would say okay, that sounds similar to the offer in the marketplace last year,” Minson said. “It may be similar but in terms of what you get for that $79 it is very different from what we gave a year ago and what we have now is the ability to meaningfully up sell the customers from the beacon price.”

A year ago, Time Warner Cable didn’t have a modem rental fee and typically bundled its Standard tier Internet service in its promotional packages. A traditional triple-play package of phone, cable TV and Internet service starts at $89 today, but only includes 3Mbps broadband, doesn’t bundle DVR service, and doesn’t include a mandatory set-top box which now costs a minimum of $8.99 a month each. Combining the modem fee with the mandatory box charge raises the promotional price to $104.97 a month.

• Upgrading to Standard 15/1Mbps service costs an extra $10 a month.
• Adding a DVR? That costs an additional $21.94 a month.
• The “whole house” DVR package is now priced at $37.47 a month.
• Time Warner Cable has also recently increased the price of premium movie channels to a uniform $15.95 each for HBO, Cinemax, Showtime, and Starz.

Taking into account these popular upsold add-ons, the promotional price of $79-89 might be seen as bait and switch by some customers. The true cost for most choosing a triple play package including cable TV with DVR service, one set-top box, a Time Warner-supplied cable modem, and a speed upgrade to 15/1Mbps service is $127.92 a month before taxes and fees.

Customers unhappy with their cable bill who call to complain are now routed to specially trained retention operators, Minson said.

“We’ve taken about a 1,000 dedicated employees and focused them on retention and even within those centers there are areas of expertise,” Minson said. “For our Spanish language customers we have retention centers set-up to help them when they call in. For people who are coming off a promotional offer, we have dedicated reps who can deal with that group of customers. So it’s having a deeper set of expertise in those areas and the returns so far are well within our expectations and we are really pleased with how it’s going.”

Just weeks after Time Warner Cable and CBS settled a dispute over retransmission fees, other broadcasters and networks are preparing to make new demands for increased compensation from their cable, satellite, and telco IPTV partners at prices likely to provoke more blackouts.

Despite repeated protestations from Time Warner that over-the-air stations and networks deserve lower fees than cable-only networks, once the two parties went behind closed doors, the cable company quickly agreed to pay considerably more for CBS programming. Sources say CBS made a deal that will run up to five years and includes more than $1.50 in fees per subscriber, up from between 50-85 cents per month, depending on the city served, under the old contract. CBS had asked for about $2 a month. Effectively, the company will earn more than that because Time Warner also agreed to renew both the CBS Sports Network and Smithsonian Channel, which cost extra.

“There is a new template here. Two dollars is the new holy grail,” Wunderlich Securities analyst Matthew Harrigan told Reuters.

Fox was the highest paid network before the CBS deal, collecting close to $1.25 per month per subscriber. ABC receives 50-65 cents and NBC less than that.

Harrigan predicts the other networks will race to raise their own prices, with Time Warner Cable (and others) likely forced to raise rates early next year to cover increased costs.

In the war for compensation, programmers hold most of the leverage.

[flv width=”392″ height=”244″]http://www.phillipdampier.com/video/WSJ Lessons Learned CBS 9-2-13.flv[/flv]

The Wall Street Journal reports the dispute between Time Warner Cable and CBS set new industry precedents on the value of broadcast stations and networks and how their programming is distributed on digital platforms. (2 minutes)

There have already been local station blackouts in 80 cities so far this year, with the likelihood last year’s record of 91 markets will be broken before Thanksgiving. In almost every instance where a popular network is involved, the pay television provider eventually capitulates because of subscriber complaints or cancellations.

Moonves

Time Warner Cable admits its dispute with CBS cost the company business, both from prospective new customers going elsewhere and customer disconnects. Time Warner also spent money advertising its side of the dispute and paid to distribute free antennas to affected subscribers.

CBS’ Les Moonves had predicted Time Warner would eventually meet most of the network’s compensation demands before football season arrived. He was right.

“CBS is the winner. Content owners always win these negotiations, it’s just a matter of how much they won,” said Craig Moffett of Moffett Research. “They have all the leverage. Consumers don’t get mad and trade in their channel when these fights drag on. They go looking for a different satellite or telephone company.”

Almost 200,000 Time Warner Cable television customers left during the second quarter, and company officials admit that trend continued during the third quarter as the dispute dragged on. Time Warner Cable is likely to end the year with fewer than 11.5 million video subscribers, a loss of several hundred thousand this year.

Sources say one major sticking point that kept CBS off Time Warner Cable systems for nearly a month wasn’t about money. Instead, it was about digital distribution rights.

Time Warner Cable wanted CBS on its TV Everywhere app TWCTV and was also concerned about CBS selling content to online video streaming competitors that could accelerate cord-cutting.

Time Warner Cable did win permission to offer Showtime on its digital streaming platform and on apps for portable devices. But Time Warner will not get to carry local CBS-owned stations on streaming platforms, a significant blow. The cable company will also have to pay more for streamed and on-demand content.

In the end, CBS got almost everything it wanted and Time Warner Cable was handed back its largely unfulfilled wish list and a bigger, retroactive bill subscribers will eventually have to pay.

“We wanted to hold down costs and retain our ability to deliver a great video experience to our customers,” Time Warner Cable CEO Glenn Britt said in defense of the agreement. “While we certainly didn’t get everything we wanted, ultimately we ended up in a much better place than when we started.”

Moonves gloated to various trade publications and investors that CBS went unscathed after the month-long dispute.

“Our national ad dollars did not go down,” Moonves told attendees at the recent Bank of America/Merrill Lynch Media Communications & Entertainment Conference. “There were no such things as make-goods and there was no harm done financially to CBS Corporation.”

[flv width=”640″ height=”380”]http://www.phillipdampier.com/video/Bloomberg Moonves CBS Got Fair Value for Our Content 9-7-13.flv[/flv]

CBS’ Les Moonves has won his dispute with Time Warner Cable, says Les Moonves in this interview with Bloomberg TV. (10 minutes)

Comcast owns both NBC and the cable companies that carry its local affiliates.

Cable rate increases are not likely to stop with the agreement with CBS. Analysts predict NBC, ABC, and FOX will be seeking similar rates when their contracts come up for renewal. Altogether, every cable, telco IPTV, and satellite subscriber could see rates increase up to $6 a month for the four major American networks.

“Any time one of these larger networks sets the new standard in terms of pricing for their programming, the rest follow,” Justin Nielson, an analyst for SNL Kagan, told Hollywood Reporter. “In most cases it’s been CBS and FOX trailblazing what the rates should be and then ABC and NBC following.”

Comcast-NBC’s Steve Burke is already there. Burke told investors affiliates should be paying 20 to 25 percent more for cable networks such as USA, Bravo, SyFy, CNBC and MSNBC .

“We’re not paid as much as we should be given our rating and positioning by cable and satellite companies,” Burke said. “I see no reason why we won’t sort of draft behind the other broadcast networks and get paid in a similar way.”

Burke predicts NBC will earn between $500 million to $1 billion annually from increased retransmission consent fees comparable to what CBS and FOX receive.

Next week, DISH Networks faces the expiration of their contract with ABC/Disney-owned channels, including the Cadillac-priced ESPN. The outcome of renewal negotiations may serve as an indicator for where rates are headed in the world of retransmission economics.

A growing number of elected officials in Washington are paying attention as they and their constituents live through one programmer blackout after another. At least four pieces of legislation have been introduced to deal with the problem in very different ways, according to Bloomberg News:

The Satellite Television Extension and Localism Act

This law, known as STELA, dates to 2004 and gives satellite companies a license to provide local TV stations, just as cable operators do. The current law is set to expire at the end of 2014, with most observers calling its reauthorization a near certainty. The debate is mainly over how “clean” the STELA reauthorization bill will be as it emerges from the legislative process, with the pay TV companies urging lawmakers to address the issue of retransmission disputes. Broadcasters are working for a “clean” bill, written narrowly to address the satellite companies’ immediate needs. “There’s nothing clean about the current retransmission system,” says Brian Frederick, a spokesman for the American Television Alliance, a coalition of pay-TV companies. Two House committees held hearings on the law this week. A final bill and vote are expected next year.

Video CHOICE (Consumers Have Options in Choosing Entertainment)

Representative Anna Eshoo, a Democrat who represents much of Silicon Valley, introduced this bill Sept. 9 aimed at ending blackouts. “Recurring TV blackouts, including the 91 U.S. markets impacted in 2012, have made it abundantly clear that the FCC needs explicit statutory authority to intervene when retransmission disputes break down,” Eshoo said in a press release. (The FCC gets involved now only if one party accuses the other of negotiating in bad faith.) The bill would unbundle broadcast stations from a cable package and prohibit a broadcaster from requiring a pay TV operator to take affiliated cable channels to obtain more popular channels. That issue is at the heart of why Cablevision sued Viacom in February, following a contentious negotiation.

Eshoo’s bill would also require the FCC to study programming costs for sports networks in the top 20 regional sports markets. The rising fees for sports programming—led by ESPN—is considered one of the major influences behind rising cable bills and the power that content creators such as Disney hold in negotiations. Cable companies have praised Eshoo’s bill, while broadcasters are not fans. Don’t expect to see it get far in a Republican-led House.

Television Consumer Freedom Act of 2013

This bill, introduced in May by Senator John McCain (R-Ariz.), would end the long era of the cable television bundle, that phenomenon by which you pay for hundreds of channels and find yourself watching only about two dozen, or fewer. This summer, Connecticut Senator Richard Blumenthal signed on as a Democratic co-sponsor, but there’s been no similar sponsors on the House side. Blumenthal explained his support of the bill in an August interview with the Hollywood Reporter:

“What I hear from cable consumers overwhelmingly is, ‘give us freedom of choice. Don’t make us pay for something we don’t want and won’t watch. Why am I paying for—you name a channel you don’t like or five or ten or them—just so I can watch the one I do want.’ That’s overwhelmingly the sentiment of people who buy this product. So this bill just gives voice and force to that sentiment.”

Next Generation Television Marketplace Act

This bill from Representative Steve Scalise, a Louisiana Republican, and former South Carolina Senator Jim DeMint, also a Republican, dates to December 2011 and would deregulate the entire television market, top to bottom. It would repeal compulsory copyright licenses, the legal mechanism by which content owners are required to let pay TV companies carry their programs, if they are paid a fee for the content. The bill, which would also dismantle the system of retransmission fees, is essentially an exercise in carrying free-market ideology to its logical conclusion. The problem? It would require a countless number of individual deal negotiations—any radio or television station that wanted to carry programming (i.e., all of them)—would need to strike deals with every programmer, yielding an inefficient system that would likely prove unworkable. Lawyers would love the bill, but don’t expect it ever to pass Congress.

In fact, none of these bills are expected to pass through both the gridlocked House and Senate this year.

[flv]http://www.phillipdampier.com/video/CNBC Les Moonves Says It Would Be Dumb For Lawmakers To Change Retransmission Rules 9-4-13.flv[/flv]

CNBC also talked with CBS’ Les Moonves about CBS’ views towards compensation and distributing content online. (13 minutes)

TiVo Roamio DVR

The newest entry in the should-be-more-competitive world of Digital Video Recorders (DVRs) might have gotten five stars from reviewers willing to play down the device’s asking price, but the biggest hurdle of all isn’t its cost, it is the complexity of getting it to work properly with your cable provider.

TiVo’s new Roamio was designed to declutter your viewing experience. It’s a DVR that can record shows you missed, an online video device that can stream content from Netflix, Hulu Plus, Amazon Instant Video, Spotify, Pandora and YouTube right on your television, and perhaps most powerful of all — it will soon stream it all to you on any mobile device located anywhere there is an Internet connection.

That puts TiVo’s Roamio well ahead of the behind-the-times set-top boxes and DVRs rented out by the cable company. Customers have clamored for a device that can properly record scheduled programs and allow those recordings to be viewed anywhere the customer wants to watch. Comcast’s box doesn’t work that way. Neither do boxes from Time Warner Cable, Cox, Bright House, and the rest.

Cue the lawyers.

The reason these common sense portability features are not available on the box you rent in perpetuity from the cable company is that programmers won’t allow it and many pay television providers don’t consider it a priority. Time Warner Cable only recently filed a patent to deliver customer-recorded content to portable devices. The patent application is an exercise to placate litigious programmers that cannot sleep nights knowing someone is offering a service they failed to monetize for themselves through licensing agreements. Feel the legal fees piling up:

“Because of the increasing popularity of home networking, there is a growing need for a strategy that enables a user to perform authorized transfer of protected content, e.g., transferring content from an STT [set-top terminal] to a second device in a home network, and at the same time prevents unauthorized distribution of the protected content,” Time Warner writes in its patent application.

While TiVo is selling a device that allows consumers to record programming for private viewing purposes, a cable operator with deep pockets that only rents DVRs cannot do likewise.

The Roamio comes in three versions, none of which are compatible with satellite television services:

• Roamio Pro ($600): Six tuners allow customers to record up to six shows at one time and has storage capacity for 450 hours of HD programming. Includes built-in Wi-Fi. Stream TV to mobile iOS devices coming soon (as is Android support);
• Roamio Plus ($400): Same as above except storage capacity is 150 hours of HD programming;
  Roamio ($200): Four tuner basic version omits built-in streaming to mobile devices but can record four shows at once and store 75 hours of HD programming. A good choice for cord-cutters as it includes an over-the-air broadcast television antenna input.
• All Roamio devices require TiVo service, which costs $15 a month or $500 for a lifetime subscription. All boxes support external hard drives with an eSATA interface to backup or store more recordings. All Roamio devices support 1080p and Dolby Digital 5.1 sound.

This Comcast DVR is only available for rent.

In contrast, cable operator-provided DVR service can often add $20 a month to your cable bill… forever. But is there real value for money paying TiVo $15 a month (or a $500 payment for the life of the device) for “service” on top of hardware that can cost up to $600?

TiVo thinks so: “Once you bring together all your favorite shows, movies and music into one place, you’ll wonder how you ever lived without it.”

Unfortunately, getting there is one heck of a battle according to Bloomberg’s Rich Jaroslovsky, who got his hands on a test unit that simply refused to get along well with Comcast.

“The cable industry is standing in the way,” Jaroslovsky writes.

That may not be surprising, considering the lucrative business of renting DVR equipment to customers eager for time-shifting and commercial-skipping. The cable company’s concept of DVR service includes a set-top box, decoder, and recording unit into one, relatively simple integrated device.

TiVo’s persistent monthly “service fee” as well as a steep purchase price made marketing the cable company’s “no-purchase-required” DVR easy, and the cable industry quickly won the lion’s share of the DVR business. Another strong argument in favor of the cable company’s DVR is the lack of a complicated set up procedure to get competing devices to reliably work with the cable company’s set-top box.

Motorola’s M CableCARD

Thanks to Comcast and other cable companies, setting up Roamio managed to confound even a tech reporter like Jaroslovsky, and Comcast was not much help.

The Roamio requires a CableCARD, a plug-in card-sized version of the cable company’s set-top box, to unlock digital cable channels.

The CableCARD was Congress’ attempt in the 1996 Telecom Act to give consumers an option to avoid costly and unsightly set-top boxes. Originally envisioned as a plug-in device that would offer “cable-ready” service without a set-top box in future generations of televisions, the CableCARD never really took off. The cable industry opposed the devices and dragged its feet, preferring to support its own set-top boxes. The CableCARD that eventually did emerge was initially often difficult to obtain and had huge limitations, such as one-way-only access which meant no electronic program guide, no video-on-demand, and no access to anything that required two-way communications between the card and the cable company. Newer CableCARDs do offer two-way communications and support today’s advanced cable services.

The only place most cable operators mention the availability of the CableCARD in detail is in a federally mandated disclosure of pricing, services, and a consumer’s rights and responsibilities — usually provided in a rice-paper-thin, tiny-print leaflet included with your bill once a year, if you still get one in the mail.

Roamio is likely to frighten technophobes right from the start with this important notification:

CableCARDs are made by one of four manufacturers: Motorola, Scientific Atlanta/Cisco, NDS, or Conax. You need one multi-stream CableCARD (M-card). Single-stream CableCARDs (S-cards) are not compatible.

“That costs an extra $1.50 a month from Comcast, and in my case, required three trips to its nearest office because the first card didn’t work,” Jaroslovsky writes.

On the second trip, Comcast handed him two cards in the hope at least one would work, requiring one last trip to return the card that didn’t.

Time Warner Cable and certain other cable operators use Switched Digital Video, incompatible with the Roamio without a Digital Tuning Adapter, available from the cable company.

The second hurdle was to get Comcast to recognize and authorize that CableCARD. Comcast’s technical customer support staff was lacking. Jaroslovsky found his call bounced from department to department attempting to authorize the card and diagnose why it simply refused to work at first.

After finally overcoming those problems, Jaroslovsky discovered he was out of luck getting Roamio to stream premium movie channels like HBO and Cinemax. The encryption system Comcast supports prohibits streaming the movie networks outside of the home. The Slingbox works around the issue by bypassing the encryption system’s permission settings with extra cables between it and your cable box.

Time Warner Cable subscribers will need still another piece of equipment — a Tuning Adapter compatible with Switched Digital Video (SDV). To conserve bandwidth, cable companies like Time Warner limit certain digital channels being sent to each neighborhood unless someone is actively watching.

Before you can view or record a program on an SDV channel, your box must be able to send channel requests back to the cable headend. Roamio is a one-way device and cannot send the required channel requests. Cable providers who have deployed SDV technology will provide a Tuning Adapter to customers who have HD TiVo boxes. A Tuning Adapter is a set top box that provides two-way capabilities, so your box can request SDV channels. There are two Tuning Adapter brands: Motorola and Cisco. Motorola CableCARDs work with Motorola Tuning Adapters. Scientific Atlanta and NDS CableCARD work with Cisco Tuning Adapters. Without the Tuning Adapter, a Roamio user will find error messages on several digital channels indicating they are “temporarily unavailable.”

Other cable operators offer varying support for Roamio. Cablevision has been learning how to support the device along with customers. Prior customer experiences make it clear front-line service representatives are not going to be very helpful managing the technical process to properly configure, update, and authorize CableCARD technology for the new TiVo device, so prepare to have your call transferred to one or more representatives.

After all this, Jaroslovsky was finally watching his Comcast cable channels, able to access on-demand services, and found TiVo’s interface and program guide more satisfying than the one offered on Comcast’s DVR.

Roamio Plus and Pro have built-in support for video streaming away from home that will be fully enabled this fall.

Jaroslovsky found in-home streaming smooth and satisfying. Programs launched quickly and looked terrific on an iPad with Apple’s high-resolution Retina display, with none of the blockiness or stuttering sometimes associated with streaming video.

His review unit allowed him to test streamed programming outside of the home and video quality on the go was much more variable. The current software prohibits video streaming on AT&T’s 4G LTE network, a problem with a resolution now in the works. Public Wi-Fi hotspots often delivered poor performance, even when they could supply up to 2Mbps. Blurred pictures and pixel blocks often broke up the video on slow Internet connections. A faster connection supporting more than 10Mbps is capable of delivering a better viewing experience, especially if that connection comes without usage caps.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/TiVo Roamio DVR Demo Video 8-19-13.flv[/flv]

An introduction and demo of the TiVo Roamio DVR, produced by TiVo. (3 minutes)

This article was updated with a clarification about Tuning Adapters, required by some cable operators using Switched Digital Video. Thanks to reader Dave Hancock for helping clear things up.

Incoming Rogers CEO Guy Laurence has a reputation for hating cubicles, desks, meetings, and paper. How many Rogers’ employees will be left to enjoy the changes is unknown.

Rogers Communications has tapped Guy Laurence, the head of one of Great Britain’s largest cell phone operators to lead eastern Canada’s biggest cable and wireless firm after current CEO Nadir Mohamed retires in early December.

The company has spent months on a global search to find its next chief executive and signaled how important its wireless business is by selecting the current CEO of Vodafone UK to run the business.

Shareholders barely registered this morning’s announcement, with little movement in the stock, but analysts at some of Wall Street’s largest investment banks think the choice will help Rogers better position itself against increasing competition from Bell/BCE and Telus, which have stolen away some of Rogers’ cable and wireless customers.

“Its unique mix of wireless, cable and media assets offer a brilliant platform to provide innovative service to Canadians. I intend to build on the strong foundation established under Nadir’s leadership to compete and win in the market,” Laurence said in the statement.

When Laurence relocates to Rogers’ headquarters in Toronto, he will be immediately confronted with a Conservative government that has made wireless competition a hallmark of its political platform. In January, Rogers will be a participant in federal spectrum actions for coveted new 700MHz frequencies that Rogers wants to expand its cellular network. Ottawa wants some of those frequencies to be set aside for new competitors to bolster wireless competition. Rogers, along with the other large incumbents, wants access to bid on all available spectrum.

The company has struggled with declining market share as a growing number of customers finishing their wireless contracts have taken the opportunity to change providers, mostly to Bell and Telus’ benefit.

Rogers Cable has also suffered subscriber losses in Ontario from increasing competition from Bell’s IPTV service Fibe, which continues to run aggressive new customer promotions.

Rogers may be hoping for an image reset in Canada, and Laurence’s unconventional way of doing business may help.

“I don’t believe in offices. They’re a thing of the past. Offices produce things like a conventional company,” Laurence told a British newspaper in 2011.

To underline his point, Laurence abolished offices and personal desks for Vodafone employees and underlined the new policy by ordering cleaning staff to incinerate any items left on desks overnight. Vodafone workers are given a laptop, a Vodafone mobile phone and an employee locker. Where they choose to conduct business is up to them. Meetings are heavily frowned upon.

The incoming Rogers CEO also despises paper, and wants employees to use as little of it as possible.  At Vodafone, workers often had to buy paper themselves for use in the office and hide it from view.

Rogers’ dress code may also radically change. At Vodafone, Laurence insisted employees dress the same way customers do.

“When you remove the barriers of offices, meetings and all the rest of it, people can spend more time doing what they’re supposed to do,” Laurence said. “As a consequence, people start to perform better. It used to take us 90 days to do a pricing change. We do that in four days now.”

Analysts suspect fixing Rogers’ lousy reputation for customer service will be one of his top priorities. Rogers’ executives will also be updating their resumes — Laurence has a reputation for shaking up middle and upper management. But one priority Rogers’ investors expect will not change: protecting the company’s high profit margins and continued efforts to cut costs.

Laurence did not forget everything he learned while getting his MBA. After joining Vodafone, he initiated a brutal workforce reduction that separated 2,350 Vodafone employees from their desks and lockers – permanently, slashing the payroll from 9,500 to 7,150 workers.