HDTV Battlefield1/25/2004 7:00 PM Eastern
Not since the early days of cable TV, when programming consisted entirely of channels retransmitted from local broadcasters, have operators relied on broadcast programming content to lure new customers.
But with CBS broadcasting this Sunday's Super Bowl XXXVIII in HDTV — at a time when cable and satellite firms are battling to win the high-end customers buying those costly HD sets — major MSOs are running ad campaigns this week touting their carriage of the Super Bowl in HD on CBS.
Marketing campaigns from several cable systems owned by Comcast Corp., Cox Communications Inc., Adelphia Communications Corp. and Mediacom Communications Corp. could be a double-edged sword.
The ads might help the MSOs compete against rivals EchoStar Communications Corp. and DirecTV Inc., which also is running a Super Bowl campaign.
But the marketing pitches also might give CBS and other broadcasters more leverage in their push to get cable operators to pay them for carrying their high definition signals.
"There is some irony that cable expresses outrage about broadcasters having the audacity to suggest that in retransmission-consent deals that broadcasters actually get compensated for our signal — yet they're also advertising themselves as a reason to subscribe to cable over satellite by highlighting the fact that they carry HDTV broadcast programming," National Association of Broadcasters spokesman Dennis Wharton said.
Cable executives countered Wharton's argument by pointing out that broadcasters don't pay a dime for their spectrum. "Why should cable customers have to pay extra for what is supposed to be a free signal that broadcasters have been granted?" said NCTA spokesman Brian Dietz.
Several cable systems scrambled during the last few weeks to line up deals with CBS stations in their markets to carry Super Bowl XXXVIII on Feb. 1.
But the availability of CBS in high-definition is concentrated mostly in the 16 markets that contain stations owned by CBS.
Viewers in 10 of Time Warner Cable's 31 divisions might not have access to the HD signal — but spokesman Keith Cocozza said the MSO hoped that talks with CBS affiliates would lead to customers in all divisions having access to the game in HD form.
As of Friday (Jan. 23), 21 of the MSO's 31 divisions had agreements with CBS stations and affiliates to carry their HD feeds.
Also as of Friday, Comcast Corp. lacked agreements to guarantee subscribers in Seattle; Cleveland; Flint, Mich.; and Sacramento, Stockton and Fresno, Calif., would be able to watch the game in HD.
The same held true for Cox Communications Inc. subscribers in New England; Omaha, Neb.; Wichita, Kan.; and Bakersfield and Santa Barbara, Calif. — and for Insight Communications Co. customers in Evansville, Ind., and Peoria and Champaign-Urbana, Ill., where HD deals with CBS affiliates had not been struck.
Last year, the NAB criticized cable after ABC's Super Bowl broadcast, noting viewers in 64 of 80 markets where broadcasters had converted to HDTV were unable to watch the Super Bowl in HDTV on local cable systems.
CBS spokesman Dana McClintock said the network does track the number of cable systems that carry the network in HDTV – either from CBS owned-and-operated stations or from independent affiliates.
But he declined to say how many systems would carry the game in high def, saying retransmission-consent talks with cable operators were ongoing.
Cable distribution of CBS's HD signal is less prevalent in systems located near network affiliates owned by other station groups.
Emmis Communications Corp. owns five CBS affiliates that will carry the Super Bowl in HD, but none of the five stations in California, Oregon, Connecticut and New Mexico have deals with local cable systems to carry their HD feeds, spokeswoman Kate Healey said.
"Our policy is that we want to be compensated for the signal that the local cable operators charge for," Healey said.
She said Emmis continues to talk to cable operators about carrying the high-definition signal, but won't back down from insisting that cable systems pay the broadcaster for HD signals.
Other cable operators have been scrambling to cut last-minute deals to offer the Super Bowl in high definition.
FAIRFAX, SALT LAKE
They include Cox's Fairfax, Va., system, which cut a deal to get the game last Wednesday, and Comcast's Salt Lake City system, which reached a deal with local CBS affiliate KUTV-TV earlier this month.
Time Warner Cable's Southwest division also reached a deal to offer the CBS HD feed last week.
Cox Fairfax spokesman Alex Horwitz said there were plans to run print ads and cross-channel spots touting the Super Bowl. The on-hold message subscribers hear when calling the system will also pitch the game, and Horwitz said Cox is sending automated telephone messages to existing HD subscribers to let them know that the system picked up the CBS HD feed.
Time Warner systems that carry the CBS HD feed were running a direct mail campaign promoting HDTV, encouraging subscribers to upgrade to HDTV so they could get "the big game."
Comcast carries CBS in high definition in 29 markets. Senior vice president of marketing and new products Andy Addis said the MSO continues to talk to other CBS affiliates about carrying their HD signals, but he declined to say whether a debate over whether Comcast should pay for HD feed is holding up negotiations.
In a broad carriage deal Comcast cut with Viacom in December, they agreed to jointly market the availability of the Super Bowl in Comcast systems located in markets where CBS owns stations.
Addis said CBS stations are running spots that tout the availability of the game on Comcast systems, and Comcast also is running cross-channel spots and newspaper ads touting the Super Bowl.
"We're also in discussions with [consumer electronics] manufacturers and retailers" to promote the game, Addis said. "Our interests are all aligned as it relates to what we're trying to do with the HDTV category."
Comcast is also running a promotion with Best Buy that offers rebates to consumers who purchase an HDTV set and subscribe to Comcast's HDTV service, Addis said.
Generally, the ad campaigns from Comcast and other MSOs claim that cable is the easiest way for viewers to receive HDTV.
Mediacom's Des Moines, Iowa, system also planned to run cross-channel spots touting carriage of the HD feed from local CBS affiliate KCCI-TV.
"It's a competitive advantage for us because our competitors in the sky do not carry the service," Mediacom senior director of sales and marketing Tia Murphy said.
The Des Moines system was trying to get KCCI-TV to mention that the Super Bowl is available in HD on cable in the station's promotions for the game, Murphy added.
Adelphia plans to run cross-channel spots and radio and newspaper ads touting its HD carriage of the Super Bowl on systems in Colorado Springs, Northern Virginia and the Greater Ohio Valley, spokeswoman Erica Stull said.
The newspaper ads make no mention of CBS. The ad copy reads, "Adelphia HDTV and the Super Bowl. Adelphia has it. Satellite doesn't."
Adelphia and Mediacom ads make the most of CBS HD distribution holes at rivals DirecTV and EchoStar's Dish Network, which will only be able to offer the game via satellite to subscribers that live in 16 markets where CBS has O&Os.
The only way EchoStar and DirecTV customers outside of those CBS markets can get the HD feed for the game is via an over-the-air antenna, or if they qualify to receive a distant network signal from CBS.
It wasn't clear until last week that any EchoStar customers would be able to watch the Super Bowl.
EchoStar recently sued CBS parent Viacom Inc. after EchoStar said Viacom wanted stiff fees to carry CBS stations.
EchoStar obtained a temporary restraining order preventing Viacom from pulling the CBS feed, and a California court last Wednesday — at Viacom's request — extended the restraining order until March 3.
DirecTV Inc. plans to run ads touting HD carriage of the Super Bowl in major newspapers in New York, Los Angeles, Chicago, Dallas, Minneapolis, Baltimore, Philadelphia and Boston, in addition to spots on a DirecTV sports barker channel.
Senior director of acquisition marketing Steve Brister said they're designed to attract new customers and get existing subscribers to upgrade to a high-definition programming package.
The Super Bowl has also driven increased sales of HDTVs at some major retailers. Circuit City Inc. has seen increased sales of big-screen TVs in general, including HDTV monitors, spokesman Steve Mullen said.
Tweeter Home Entertainment Group Inc. spokeswoman Kate MacKinnon said HDTV sales have been strong particularly in New England and the Carolinas, as local New England Patriots and Carolina Panthers fans shell out money to watch their teams compete in the championship.
"The fans are excited and the salespeople are excited," MacKinnon said.