Cables PR: Some Expert Advice

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While the cable industry was celebrating its 50th birthday
in Atlanta last week, public-relations executives were gathering in New York, discussing
such topics as "Overcoming Conflicts," "Building Credibility" and
"Shaping Public Opinion."

The timing came as a reminder that MSOs, while they may
currently be on a roll, still have an Achilles' heel: a less-than-sparkling public image,
burnished by decades as an insensitive monopoly, and most recently inflamed by a series of
rate hikes well above the rate of inflation.

Some critics contended that even one of the industry's most
vaunted achievements -- the seemingly endless parade of new channels -- hasn't helped.

At a contentious general session at the Cable Television
Public Affairs Association conference in San Diego in March, Bob Laurence, TV critic for
the San Diego Union-Tribune, said the industry's image problems were
"well-deserved."

He called cable a "medium of extremes," allowing
that while there were some "really, really good" programs, mostly, "there
was lots of junk."

"There's a lot of ill will out there," Laurence
added. "People feel that they don't have a choice."

One public-affairs official stood up and angrily took
exception, exclaiming, "The problem with cable's image is Bob!"

But Laurence stood his ground and urged the cable
executives to "face the issue, rather than pretending its not there."

So, are cable operators in a state of denial?

And even if they aren't, what should they be doing to
improve their image?

There's little doubt that cable executives -- particularly
public-affairs officers -- have become increasingly sensitive to the PR ramifications of
rate increases.

But PR experts from outside of the industry questioned
whether cable operators truly see the big-picture viewpoint of how their industry is
actually perceived by the public.

James Carville -- who gained fame as an architect of Bill
Clinton's successful presidential campaign in 1992, and who is now senior political
advisor to the president -- said, "People look at cable more like a utility that
they're stuck with than like a product where they have a lot of choices, and therein lies
most of their problem. If [the cable industry] is trying to tell me something, I don't
know what it is."

Carville suggested that cable systems "try to show
some kind of humanity," citing discounts for senior citizens as one example.

He also said cable companies should stress their role as
service businesses and have "every employee" convey the message that they are
working for subscribers.

Stuart Ewen, author of PR! A Social History of Spin
and professor of media studies and chair of the department of communications at Hunter
College in New York, cited a historical analogy that he thought was applicable to the
public's perception of the cable industry: the pre-1980s AT&T Corp., when the company
still had a monopoly on telephone service.

Ewen said AT&T sought to counter its monopoly status
with a number of shrewd PR moves. One was a deliberate cultivation of the "Ma
Bell" image by hiring women to be telephone operators and giving the
telecommunications giant a warm, maternal public "face" -- or, more accurately,
voice.

While other near-monopolistic corporate behemoths like
Standard Oil concentrated their PR efforts earlier in the century on "pumping out
imagery," Ewen said, AT&T worked on creating a "personable image" by
"actually humanizing the business."

He also noted that by charging high rates for long-distance
service -- which, for years, was mostly used by businesses -- AT&T was able to give
its residential customers price breaks and not appear greedy.

The key, Ewen stressed, was action, and not words.
"Any public relations purely predicated on perception management will not work,"
he stated. "People pay their bill every month. They know what's going on. Mere image
management will not do it. PR must be predicated on price and service."

Leslie Dach, vice chairman and general manager of Edelman
Public Relations Worldwide, agreed that service and customer interaction are important.
But he also argued for a good media campaign.

One effective strategy, he advised, was to "develop
friends around the country who will speak up on your behalf." A key objective, Dach
said, was to "avoid being seen as greedy. It's a subtle line, but once you're over to
greed, it's hard to dig your way out of it."

Developing this kind of grassroots campaign has its
pitfalls, however.

Microsoft Corp., which is currently under investigation for
possible antitrust violations, was put on the defensive last month for using tactics
suggested by Edelman. The Los Angeles Times reported Edelman's proposal that
Microsoft provide "media air cover" for a public-affairs campaign in states
where the software company is being investigated by generating favorable news articles,
op-ed pieces and letters to the editor, "coordinated in lockstep with the
company."

Dach also downplayed the role of advertising in improving
cable's public image, because "so much" of the public's opinion about cable was
formed by "personal experience."

And it doesn't get much more personal than writing a check
every month -- especially when the amount has been going up by an average of 8 percent for
three years in a row.

The cable industry's efforts to put a positive spin on the
hefty price hikes -- or to at least "communicate" them "effectively"
-- were a centerpiece of its recent public-affairs conference.

David Pierce, director of public affairs for the National
Cable Television Association, told operators that focus groups on rate increases showed
that customers:

• Did not want to hear a "value" message,
extolling cable's value for the money on a per-channel basis;

• Did not want to hear about how much more programming
costs cable operators. "They didn't care about [operators'] costs, Pierce said,
"period";

• Did not want to hear the argument that prices are
going up for everyone, so, "We're all in the same boat";

• Did not want to hear their cable company
"whine. This came up over and over again," Pierce said.

What did work when justifying rate increases? Pierce
mentioned:

• Original programming scored "very high";

• Local programming was valued "more than
expected ... People want to be able to watch City Council meetings and high-school
football. It's something that cable can do that broadcasters can't";

• "A good-neighbor message," Pierce said,
citing programs like Cable in the Classroom and working with local charities;

• Cutting-edge technology, like high-speed Internet
access. "People find it innovative and exciting," he said.

Large MSOs reported similar findings in their own focus
groups about rate hikes, and they have incorporated subscriber feedback into their
communications messages and strategies.

Matt Fleury, executive director of communications for
Tele-Communications Inc.'s central division, said TCI subscribers rejected regulatory
explanations for price hikes; "soft-touch" newsletters and ads; and ambiguous
concepts or phrases, like "great" programming and "cheaper than going to a
baseball game."

What they preferred, he said, were messages -- preferably a
personal letter from the system's general manager -- with "empirically driven,
straight-ahead information."

The tone of the letter, he said, should be businesslike,
direct and concise, without assigning blame and avoiding superlatives.

In fact, Fleury and MediaOne's Rick Jenkinson, director of
communications and public affairs in the Northeast, said TCI and MediaOne used comments
from focus groups to help write -- and edit -- letters notifying customers about price
increases.

MediaOne's customers, Jenkinson said, told the company not
to "sugarcoat" the rate hikes and to be as "straightforward" as
possible.

One major factor in customers' reactions to higher bills,
Jenkinson said, was whether or not systems had recently undergone upgrades, resulting in
more channels and high-speed Internet access. "People saw value" when they
received an improved product, he said, while customers whose service had not been upgraded
reacted "180 degrees differently" when informed about price increases.

The MSO handled that PR crisis, Jenkinson said, by telling
customers that upgraded service was coming, even if it was several years away.

"As long as they know it's coming, it's OK," he
said. "They were willing to wait."

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