Dolan: Always an Enigma

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Last week's sale of Rainbow Media Group's Bravo network to NBC for $1.25 billion left a lot of folks wondering what Cablevision Systems Corp.'s ruling Dolan family was planning to do with its remaining assets.

During a third-quarter earnings call that came on the heels of the Bravo deal, Cablevision CEO James Dolan told analysts that American Movie Classics might be for sale, too. He did not mention WE: Women's Entertainment, but oddsmakers were predicting that channel would probably be on the block as well.

Cablevision, the seventh-largest U.S. MSO — and a family-owned company with an unusually diversified portfolio — has once again left Wall Street analysts scratching their heads.

The Bethpage, N.Y.-based company has been unusually busy. The company plans to exit the movie theater business, having retained J.P. Morgan Chase & Co. to sell its Clearview Cinemas properties. The Dolans also closed 17 branches of Cablevision's consumer-electronics chain, The Wiz, and have unburdened themselves of Bravo.

And more than a month ago, the Dolans told The New York Times
that they'd consider selling their cable systems — and 3 million subscribers, all in greater New York City — to Time Warner Cable, or consider a partnership of some sort.

But just last week — thanks to an infusion of capital — Cablevision announced a major and accelerated rollout of its digital platform, iO: Interactive Optimum. Cablevision was the last MSO to get into the digital-television movement, and like a rogue dog it broke ranks, selecting a box from Sony Corp.

Now the company is shying away from Sony and deploying other boxes in its systems.

Cablevision, a company that is unlike any traditional cable MSO — now more so than ever — remains an impenetrable enigma.

If anything, last week's analysts' call only seemed to deepen the mystery of what the Dolans are up to as they wrestle to maximize the value of their very diverse assets.

Perhaps most curious is what, if anything, the company intends to do with its limited direct-broadcast satellite spectrum. Last week, the younger Dolan told analysts that the company would even consider selling its DBS slots.

That's not a shocker, considering that Cablevision's plan to buy 40 transponders from EchoStar Communications Corp. — in a move designed to create a second national DBS service that assuage regulators wary of EchoStar's plan to merge with rival DBS provider DirecTV Inc. — didn't pass muster. Now anything goes.

Dolan told analysts that Cablevision still plans to launch a satellite service next March, but added that it might also sell the spectrum instead.

For now — with EchoStar and DirecTV remaining two separate satellite companies — Dolan told analysts that Cablevision's satellite assets are more valuable than ever.

As an editor covering this sector, I think this company is intriguing, and find it impossible to predict what it might do next. But on a more personal front, as a Cablevision subscriber, I find this all quite vexing.

Cablevision bought my system from Tele-Communications Inc. in the late 1990s, and I'm still sitting here looking at a legacy Headend In the Sky digital-television service.

Although my street seemed to have been rebuilt several months ago, a Cablevision customer-service rep said we would not get digital before the new set-top boxes arrived. So no Sony box for me. Hurrah!

What about those who aren't in cable, and see Cablevision's constant advertising encouraging subscribers to sign up for iO? I find that to be very sloppy business.

Having watched Chuck Dolan at work all of these years, something big is going to emerge when he's finished moving around all of the pieces. I wouldn't bet against him, that's for sure.

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