Looking to beef up its lobbying efforts, the American Cable Association will boost its membership through a strategic alliance with the National Cable Television Cooperative, officials at both groups said last week.
Under the arrangement-which builds on their close cooperation in the past-member companies of the NCTC, a buying co-op, will also join the ACA, a lobbying group, as dues-paying members.
As a result, the ACA could as much as triple its membership roster, increasing it from 300 companies to as many as 1,000. That would give the ACA more clout and a stronger financial base from which to do its work in Washington, thus benefiting the NCTC's small-operator constituency.
Officials stressed that the two organizations aren't merging, but will remain stand-alone entities with separate boards.
The ACA wants more weight in Washington, D.C., where it lobbies lawmakers and regulators on behalf of independent cable operators, ACA president Matthew Polka and NCTC president Michael Pandzik said.
"There is strength in numbers," both men wrote in a joint letter to the NCTC's members explaining the new arrangement.
Starting next month, the Lenexa, Kan.-based NCTC will bill its members 1 cent per subscriber, per month, for active membership in the ACA, or 12 cents per subscriber a year. For a 50,000-subscriber system, that would mean $6,000 in annual ACA dues.
In the letter, the NCTC tells members: "This billing is not mandatory for you to pay, but NCTC's board and ACA's board fully support this plan and expect ALL members to participate..NCTC and ACA need each other, and you need both NCTC and ACA, too, if you hope to stay competitive in an ever-changing industry."
The NCTC, founded 15 years ago, bills about 1,000 member companies each month. They are mostly small and medium-sized cable operators representing 13 million subscribers.
The buying cooperative negotiates master contracts for both programming and hardware, securing discounts from suppliers by negotiating for its members en masse. The NCTC is able to get price breaks similar to those large MSOs can get by using their distribution clout to negotiate lower license fees for programming and hardware.
In contrast, the 7-year-old ACA, formerly the Small Cable Business Administration, acts as the voice of independent cable in Washington, representing its interests to Congress, the Federal Communications Commission and other agencies. The organization now has 300 member companies that serve 3 million subscribers.
"We do the politics well," said Polka, who spends about two days a week in Washington. "We are not involved in business issues. Mike's organization does that. But we represent the same constituency."
The NCTC said the ACA's work in the capital, such as helping the NCTC to win favorable buying-cooperative rules at the FCC, contributed to the savings the co-op has won from programming services such as Home Box Office, MTV: Music Television, TBS Superstation and ESPN, among others.
According to the NCTC, it saves members on average about $8 per subscriber in programming license fees each year. The ACA's activities helped the NCTC members save about 40 percent of that, or $3.60, according to the NCTC.
Pandzik noted that the National Cable Television Association's constituency is different from that of the small operator, and that state groups that used to represent small operators have gone defunct as the larger MSOs merge and withdraw their support.
"Matt and his members are good at the Washington scene," Pandzik said.
Polka estimated 260 of the ACA's members are already in the NCTC.
The NCTC board was unanimous in supporting the ACA alliance. That includes Adelphia Communications Corp., its largest MSO member, Pandzik said.