Dolan's Digital World

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With all the downbeat economic news before — and especially after — Sept. 11, it was a breath of fresh air to publicly interview Cablevision Systems Corp. chairman Chuck Dolan.

The man is unabashedly and infectiously upbeat when you get him talking about the rollout of Interactive Optimum, or iO, the new digital service the MSO launched just this past Sept. 28.

The venue was last week's Cable & Telecommunications Association for Marketing Broadband Opportunity conference, an event which attracted more than 400 attendees to Northern Virginia's technology corridor.

For many attendees, it was the first industry road trip since the terrorist attacks, and it seemed to provide a much-needed jolt of optimism.

Dolan was the opening act at that confab, and all were eager to hear what he had to say — especially given that Cablevision was the last MSO to offer digital cable.

His company also took a decidedly different path. It opted for Sony Corp.'s digital platform, one which no other MSO is using or, to date, plans to use.

And iO's launch involved a difficult decision: the direct-mail piece heralding digital-cable's arrivals to the MSO's New York-area subscribers had been sent to the post office, and was to be mailed on the afternoon of Sept. 11.

Given what happened that tragic morning, Cablevision had the post office hold the letter for two weeks, then continued on with its original rollout schedule.

"We never had a higher return on a direct-mail piece," Dolan said at last week's Broadband Opportunity conference, though he declined to say exactly how many subscribers have signed up for iO.

Despite the downturn in the economy, Dolan was optimistic that cable would once again prove recession-proof this go-around, and that bundled services would actually save subscribers money.

One of the reasons why Cablevision waited to roll out digital was because it was already offering advanced-analog packages of 70 to 100 channels. It had little interest in a digital product that served only to further boost the channel roster.

Dolan wanted to offer more, and that meant video-on-demand, interactivity and electronic mail on the TV set.

Again breaking new ground, Dolan spoke at length about Mag Rack, a video-on-demand service that at the moment consists of 16 highly targeted channels on topics that range from motorcycles to bird watching.

The company hopes to soon offer 50 to 60 of those specialized VOD offerings to its subscribers and those of other MSOs as well. Dolan is an advocate of targeted programming, whether by geography (through News 12 Networks' regional services) or by personal interest (such as the new Mag Rack). And he hopes to convince other MSOs to buy into his approach: Rainbow Media Group will soon begin marketing Mag Rack.

"It's like when color was added to black-and-white TVs: Everyone had to have a color TV. We will all have to have VOD," he predicted.

Dolan admits that there were a few initial technical glitches in rolling out iO. But down the line, he later told me, digital subscribers will be able to self-install the Sony set-tops, as they have successfully done with cable modems from The Wiz — the consumer-electronics retailer that Cablevision owns.

It's good to see the last MSO finally out of the box with digital video, especially now that the competition — direct-broadcast satellite — has just begun its long consolidation dance.

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