Hail the Conquerors

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Finally last week, a big MSO gave the fans something to cheer about.

Everyone knows Comcast Corp. has a lot of work ahead of it, and it might someday come to regret taking on the challenge that is fixing what was AT&T Broadband. But Ralph and Brian Roberts, Julian Brodsky and Comcast's other key executives have always shown themselves to be determined and oriented toward long-term goals.

And most of the fans — read, investors and analysts dying for yet another up cycle in cable stocks — give them the benefit of the doubt in being able to whip the core systems they keep over time into Comcast-worthy shape.

One of the few knocks against Comcast over the years has been a reluctance to set the pace in rolling out innovative new services. It wasn't the first to launch video-on-demand, for example. But once it got behind VOD, it quickly amassed one of the larger footprints for the service in the industry, with around 20 markets launched.

Where Comcast has set the standard is in making deals. Who would have figured the Robertses had the audacity to make an unsolicited "bear hug" bid for AT&T Corp.'s massive cable operation? People who remembered the back door through which the Roberts clan strolled to separate Glenn Jones from Jones Intercable Inc. in 1998 weren't that surprised.

Comcast started out by purchasing a 37 percent stake in Jones from Bell Canada — with an option to buy control later — for $400 million. It ended up buying the whole million-subscriber MSO for about $3,300 per subscriber, well below the price for big deals at the time.

They showed supreme savvy in bidding for MediaOne Group Inc., then yielding to an offer from AT&T — extracting $1.5 billion and, ultimately, a big prize in Lenfest Communications' 1.2 million subscribers, most clustered around Comcast's Philadelphia home. Now, of course, they're buying MediaOne's successor.

On the other side of the seesaw, the door slams on AT&T's amazing $120 billion cable gambit. It sure was exciting, bearing the promise of vastly accelerating cable operators' entry into the lucrative local phone business.

AT&T Broadband does enter the history books with an impressive 1.2 million phone customers, far and away the most of any cable company. But ultimately, it's only the most expensive of the many misfires that have occurred between phone companies and cable operators over the last decade. Bell Atlantic got out faster and cheaper.

Comcast inherits AT&T Broadband's failed focus on phone customers at the expense of basic-video subscribers, along with a physical plant that trails the industry in terms of upgrades to at least 750-megahertz, two-way capacity.

As a result, Comcast has had to pledge that its top priorities are to fix up the plant and stop losing subscribers. Not the kind of thing you'd like to have to say about your new prize acquisition — especially when the markets are hammering cable for the slightest fumbles.

But Brian Roberts, cable chief Steve Burke and their crew say they have a plan in place. And having nimbly gotten the deal done — floating it past regulators without having to make a single concession — they've more than earned that benefit of the doubt. Time will tell how long that honeymoon lasts.

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