News

Sweating It Out in New Orleans

5/05/2002 8:00 PM Eastern

which promises to be a literal steam bath this week — plays host to the National Cable & Telecommunications Association's annual meeting, largely a public-relations platform designed to spotlight the industry's latest innovations and successes.

Aside from serving as a marketplace in which buyers and sellers can wheel and deal, the National Show also rolls out the red carpet for a bevy of politicians and regulators.

It's a good thing that the NCTA's spinmeisters baby-sit these officials, given the truly alarming headlines that some of its members have made lately — headlines which signal problems that might be resolved in Washington.

First, there's Adelphia Communications Corp. and its lingering problem with off-balance-sheet debt, which remains largely unresolved, if not more complicated than originally thought.

Then there's the parent company of Time Warner Cable — AOL Time Warner Inc. — a company whose total worth was sliced in half over the course of one year. Think those shareholders are happy campers?

And don't forget about AT&T Broadband, which lost a whopping 179,000 subscribers in the first quarter. Its executives are already warning that the decline will continue into Q2.

Finally, there's the inability of Cablevision Systems Corp. to reach a carriage agreement with Yankees Entertainment & Sports Network, leaving Cablevision's 3 million subscribers shut out from YES's 130 exclusive New York Yankees games. That matter has now gone to court.

Suffice to say, there will be plenty to talk about in New Orleans this week. But not all of it is bad news. Programmmers — who had largely boycotted last year's Western Cable Show in Anaheim, Calif. — are back in full force.

But more spats could erupt with operators, given the tenor of a roundtable Multichannel News
editor Kent Gibbons led just prior to the show. Gibbons rounded up two operators and two programmers, and took their temperatures on the always-touchy subject of their traditionally rocky partnership.

Insight Communications Co. CEO Michael Willner, who is also this year's NCTA chairman, describes the relationship as one with "healthy" tension. But he fears that if more nasty negotiations are aired in the press, then government will come in and solve the problems for the feuding parties. Hear that Cablevision and YES?

Oxygen Media chairman and CEO Geraldine Laybourne thinks the relationship between operators and programmers has never been more contentious than now. She also worries that the financial pressure is now so acute on both sides that the quality of the programming — which put cable on the map — will eventually suffer. So listen up, all you programmers who are repurposing shows to cut costs.

And Mediacom Communications Corp. chairman and CEO Rocco Commisso has a beef. He maintains his cable customers have been penalized, because he does not get the programming discounts that larger MSOs and satellite companies get. We've all heard that gripe from the get-go, but it's a very real problem with no resolution in sight.

But Fox Cable Networks executive vice president of affiliate sales and marketing Lindsay Gardner said he's most optimistic about the future. Gardner wants to work with cable operators to best leverage cable's robust platform, and get content onto the newly created value-added tiers.

VOD could certainly use a shot in the arm, and now's the time for programmers and operators to find a way to make this promising technology a win-win for all — especially the customer.

October