A Week of New Eras11/02/2003 7:00 PM Eastern
New eras were bursting all over last week. At SkyForum, the annual DBS talkfest, projections were high. Cable customer growth is planing, while satellite keeps on penetrating.
On up to 70 million or more, Dish Network chief Charlie Ergen said, without specifying when.
Even avowed cable guy Chuck Dolan is focused on satellites and spectrum, and especially content. Lifetime cable-club members should keep a little perspective, he reminded folks during his on-stage chat with Paul Maxwell. It's a club, not a faith.
Comcast CEO Brian Roberts, new leader of the club, acknowledged a while ago that satellite had out-innovated cable. That's paying benefits to cable customers now. Would Scientific-Atlanta and Motorola be working overtime to crank out digital-recording set-tops — a fine accompaniment to on-demand services — had Ergen not gotten a million such boxes in homes first?
Roberts and company still have an ace in the hole: cable modems. Comcast didn't do much overall in terms of adding basic subscribers in the last quarter, but the headlines from that quarterly report last week centered on Comcast's 472,000 new high-speed data buyers, felicitously above analyst projections.
Cox CEO Jim Robbins got to change the conversation last week, too, when his company did pretty well (for cable) in terms of basic growth, adding 30,000 customers. Digital and high-speed growth numbers also were solid.
In our pages, at least, the topic with Cox never seems to stray too far from sports-programming costs. ESPN — whose contract with Cox expires early next year, if you haven't heard — had numbers on its side of the dispute last week, too. October was maybe its best month ever, its research chief said. ESPN also opted to punish Cox on the affiliate-support side after Cox created a sports-bashing Web site. Talk about your October surprises.
Cabletelevision Advertising Bureau CEO Sean Cunningham saw the new era as one when cable (and satellite) networks' ratings keep climbing. And CAB, Comcast, and others help ad agencies get past whatever might be keeping media buyers from buying more cable and putting more money into the networks' and MSOs' pockets. Merrill Lynch's Jessica Reif Cohen said last week that Comcast's $1.1 billion in ad sales from existing interconnects could double by 2006. That's a nice competitive edge against DBS.
On the regulatory front, cable operators — who might not have been that worried to begin with — dodged a possible bullet when the General Accounting Office closely examined the factors behind rising cable rates and did little other than affirm that rates are lower where wireline video operators compete. There's already legislation in place to address that situation: It's called the Telecommunications Act, and it did spur some wireline video overbuilds. The act also assured access to satellite-delivered cable-owned networks and made DBS feasible. That competition might not be keeping cable rates in check as much as every consumer would like, but it has made the product better.
Back at SkyForum, researchers reported pay TV (satellite and cable) penetration is up to about 85% of the country and declared future growth for either platform will come at the expense of the other. HDTV, DVRs, on-demand programming, high-speed data — those are the new-era innovations that will tip the scales.