Backtalk: Cable Reinvents Itself

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The most singular important trait of a successfulexecutive, company or entire industry, many would agree, is the rare ability to constantlyreinvent oneself, itself or themselves.

That reinvention usually comes in the forms of rapid growththrough the successful launch of new products to both old and new customers and theability to attract new investors to help bankroll the whole wad of putty.

With Cable '98 in Atlanta just around the corner nextmonth, it's hard not to make comparisons about what has happened to this industry injust the course of one year.

Just think for a minute about some of the historic momentsof the past year. Cable clearly has scored high on its ability to constantly reinventitself, moving swiftly and with agility -- although some may say wildly careening -- intothe future.

First, cable has demonstrated that it can actually test androll out the long-awaited new data, telephony and digital services.

Now that this process has begun in earnest, it remains tobe seen whether any or all of those products will be profitable or high-demand productsfor the masses.

But those rollouts -- particularly on the data andhigh-speed Internet-access fronts -- are the very things that attracted new investors tocable.

Second, cable has proven that it can continue to attractnew capital -- this time from the Silicon Valley guys -- to fuel its growth.

When you think about it -- especially about the computercompanies' intense interest in cable -- it's all pretty heady stuff.

One has to wonder what these new alliances that are beingforged by the day will beget -- probably products that most of us today can't evenbegin to imagine.

The latest of the computer companies' investments camelike a shot out of the blue. Just two weeks ago, Paul G. Allen, the co-founder ofMicrosoft Corp., announced that he was acquiring Marcus Cable Co. L.P. for $2.8 billion.

And that's not where Allen's spending spree willstop, with the 1.1 million Marcus subscribers. His investment bankers say Marcus was justa "starting point," and further acquisitions are likely because Allen is reallyhot on cable's broadband plant.

Allen, in his own words, described his investment in Marcusas a way to deliver immediate access to information and resources around the world, sayingthat cable provides the wires for his dreamed-of "Wired World."

Allen's chief investment advisor, William Savoy, told MultichannelNews finance editor Kent Gibbons, "What you see in this transaction is arecognition that cable is the best way to reach consumers at home."

Savoy further added, "Where everyone else talked aboutthe problems of the future, cable went out and invested the money in hard assets."

Like Microsoft's investment in Comcast Corp. lastsummer, Allen's investment in Marcus is another ringing endorsement of cable'ssuperior broadband capabilities.

And more of those investments in cable are likely to comefrom the computer camp, as, for example, speculation continues to escalate that OracleCorp. will likely buy into Time Warner Cable's Road Runner and MediaOne Express.

By the time Cable '98 rolls around -- an event thatwill serve up Microsoft's zillionaire chairman, Bill Gates, as a keynote speaker --more investments in cable from computer companies are very real possibilities.

Like the old saying, "It's not your father'sold company anymore," the cable industry has proven to be agile and capable ofreinventing itself not only to survive, but to thrive.

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