In past columns, I have spent a great deal of time focusing on marketing strategies, service techniques and management skills. All of these are very important issues that operators face today, but none are more critical than the overall "economics" of your business. After all, without solid economics, there won't be anyone around to market, service or manage anyway.

This is an industry that could use a good dose of economic lessons learned from many private providers over the years. Understanding them is one thing. Using them is another.

I have narrowed the list to six key suggestions for improving the economics of your private broadband business. Many of these points were developed from PCO experiences over the years (including my own). I hope they are of some value to you. They are also good for real estate owners to read as well, since they may shed light on why operators act a certain way.

1. Grow your core markets, not your territory. It's better to be "an inch wide and a mile deep" than an "inch deep and a mile wide." In other words, minimize your total markets to a very small number. My company used to target the entire southeastern U.S. We now only focus on growing our operations in a select number of key markets in the southeast. This has helped our operating expenses tremendously - the 3,000th customer you add in a market is a lot cheaper (and easier) to serve than the 300th. This holds true too, as you roll out data or digital services.

2. Sell or shut down the bottom 10% of your portfolio. Like many businesses, we spend over half of our time on several small problem areas of our business. Identify this 10%, and either sell these cable systems, or shut them down. You will find that those customers were unprofitable anyway, and are simply diverting management's time from growing the company. Oftentimes, these are deals taken in the early years of your growth period and you accepted these opportunities to gain traction in a particular market. Or, you were trying to get in with a particular client. Sometimes, this leads to bad economic deals. Find a way to get out. It's not different than companies such as Toys R Us, who recently closed 64 of their underperforming stores. Unloading your "underperformers" is a great economic plan.

3. Focus on your margins. Push your Basic rates as close to your franchise competition as possible. Most owners are insensitive to pricing, so long as it is "at or below" the competition's pricing across the street. Monitor your rates closely, and track your local operator's very carefully. There have been some very drastic rate increases by companies such as AT&T and Charter in the past two years. Don't let the gap get too wide. After all, your programming costs are rising - your rates should rise too. We found the gap was too great in our early years, and it has taken us quite awhile to catch up with our local competition. Do this with one eye on your subscriber counts - too steep of an increase can cause a defection to a satellite provider.

4. Be weary of projects with slow lease-ups or roll-outs. Over the years, we've been enticed by looking at projects which promised to be "the finest multi-family development deal ever built in the south," or "destined to be an award-winning community." In each case, it took over two years to see a fully occupied and stabilized project, while the bulk of our costs were sunk over twenty-seven months ago. Minimize your exposure to those "Taj Mahal" projects. Cash should create subs quickly.

5. Analyze your corporate staff. What does your management overhead look like? Has it gotten somewhat bloated in recent years? Ask one question about each position - does that role make the cash register ring? Are they integral to the generation of revenues for your company? I recently spent some time with a company that came to the realization that they were too engineer-heavy and much to light in marketing. Not good if you're attempting to grow.

6. Monitor in-house versus outsourcing of each function. In your first few years, it may make sense to outsource, but as you continue to expand, constantly consider in-house staff for virtually every function. In almost every case, in-house is more effective and less expensive in the long run.

Our industry's past has created a great economic lesson plan for all of us. We should understand this experience and learn from it to improve our own future.