Cablevision Eyes Digital Commerce

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Cablevision Systems established a new digital-marketing and commerce group, charged with developing interactive sales models that will leverage the operator’s fiber platform and high penetration in the New York market.

The first product up may be a linear-channel-based, TV-remote-enabled shopping experience, the result of advertiser partnerships with Cablevision enabling the fulfillment.

The new division is headed by Patricia Gottesman, a 28-year Cablevision veteran, who has been named executive vice president of digital marketing and commerce.

A number of key Cablevision and Rainbow Advertising Sales executives will join Gottesman’s group, including Dermot McCormack, senior VP of interactive advertising and development; Barry Frey, senior VP of advanced platform sales; and Ben Tatta, senior VP of new business development.

The new sales division is being launched now “because we’re at critical mass,” Gottesman said.

Cablevision serves 3 million homes and businesses in its 4.6 million-home footprint in the New York metropolitan area and reports 78% penetration of its iO digital product, the highest such penetration among big cable operators. Satellite and telco TV providers have nowhere near that level of distribution in Cablevision’s market, she said.

But Verizon Communications’ fiber-based television, telephone and high-speed-Internet network, still being rolled out, has taken on Cablevision more than it has any other cable company.

Verizon’s FiOS network passes 23% of Cablevision’s homes, compared with 2%-4% FiOS exposure for Comcast, Time Warner Cable or Charter Communications, Citigroup Research analyst Jason Bazinet estimated in a March 13 report. Cablevision’s own estimate has FiOS available to 850,000 homes in the cable company’s footprint.

Cablevision recently made several programming and technology moves that seem aimed at least partly at blunting Verizon. They include adding switched-digital-video technology that enables the addition of several foreign-language programming services.

And this past week, Cablevision added HD outlets from National Geographic Channel and Discovery Channel, raising to 23 the number of HD channels it offers to iO digital customers for no added charge. Verizon has pointed to foreign-language and HD channels as key attributes of FiOS, as well.

Going forward, Cablevision would like to develop a shop-from-home product, leveraging the fact that its digital set-tops contain Data Over Cable Service Interface Specification modems that enable two-way communication with potential advertisers. The Scientific Atlanta 4250 and 8300 set-tops can render a HyperText Markup Language (HTML) page from which consumers can launch onto the Internet to the page of a participating advertiser.

The new sales division will design both television and broadband applications, Gottesman said, without naming products she thought would be appropriate for on-screen shopping nor saying when such new services would be added.

Cablevision has already been experimenting with linear and multiplatform advertising models. Two-and-a-half years ago, the company launched Optimum Homes and Optimum Autos, linear channels that showcase real estate and cars for sale from area vendors. Those channels are also supported by a broadband component on Cablevision’s Optimum Online Internet service.

During the past year, the company sold branded programming slots to a number of advertisers, including Disney, JetBlue Airways, Sony Electronics, General Motors and Bertolli USA. Those ventures demonstrated to advertisers that Cablevision could deliver the content, while creating a rich data source for the advertisers on use of those channels, Gottesman said.

Cablevision’s consumers have already demonstrated a willingness to buy Cablevision services via remote, she added. More than 600,000 units of subscription video-on-demand, premium TV and Optimum Online Internet subscriptions (with modem fulfillment by mail) were purchased on the TV screen last year.

Cablevision doesn’t heavily promote that buying capability, she said, adding that the on-screen buying application is so intuitive that consumers are able to find it themselves and use it.

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