Mar 29, 2006 7:43 AM,

Time Warner Telecom may change name

By Ed Gubbins

Time Warner Telecom is considering changing its name.

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The license agreement that allows Time Warner Telecom to use the name of its major shareholder, Time Warner, expires in July. But Time Warner will extend that agreement if needed through July 2007, according to regulatory filings.

The main reason the carrier is considering a name change is to avoid confusion with Time Warner’s subsidiary, Time Warner Cable, which competes with Time Warner Telecom in some markets. Both companies offer Internet and data services to small and medium businesses. And in some places, the two have already gone head-to-head in the business data transport market.

Time Warner Cable created Time Warner Telecom in 1993 and spun it off as its own company in 1997.

Time Warner Cable isn’t prohibited by its parent from competing with Time Warner Telecom for business customers. However, the latter leases fiber from its cable counterpart in an agreement that prevents it from using that fiber to offer residential services until 2028. Time Warner Telecom is also barred from using its cable counterpart’s fiber to offer “any entertainment, information or content services” without the consent of Time Warner.

Time Warner Telecom recently hired San Francisco strategy and design firm Truebrand to advise it on its rebranding strategy.

As one example mentioned in regulatory filings, Time Warner has already agreed to let the carrier use the name “TW Telecom,” under certain undetermined conditions. But although a company spokesman called that name a “likely” candidate, no decision has been made on a new name.

The rebranding effort comes amid a surge of renewed optimism in Time Warner Telecom. Earlier this week, Morgan Stanley analyst Vance Edelson upgraded the company’s stock to “overweight,” writing in a research note, “Growth prospects are at their highest level in years, the company is ready to leverage its existing network infrastructure and last week's [$325-million] convertible bond offering should accelerate free cash flow profitability."