The ranks of programmers that will skip exhibiting at the Western Show have expanded to include MTV Networks Inc., USA Network, A&E Television Networks, Lifetime Television, Comedy Central, Scripps Networks and Oxygen Media.
Those companies are the most recent dropouts from this year's show — one of the cable industry's two biggest annual get-togethers — which will be back in Anaheim, Calif., from Nov. 27 to Nov. 30.
Roughly 40 programmers have opted not to come back this year — a group that now includes not only such giants as MTVN, but also Game Show Network, Fox Family Channel, QVC, Home Shopping Network, Telemundo, Black Entertainment Television [now part of MTVN parent Viacom Inc.] and Ovation: The Arts Network.
Veteran exhibitors Home Box Office, Showtime Networks, Starz Encore Group LLC, Playboy TV Networks, E! Networks and Discovery Networks U.S. have already publicly said they would not have booths at this year's show.
Along with the programmers, a long list of technology vendors have also left the floor, including Lucent Technologies Inc., Sony Corp., Nortel Networks Corp. and Intel Corp.
Last Friday was the deadline for companies to cancel their exhibition space without forfeiting all of their deposit. Would-be Western Show exhibitors have already forked 50 percent of the cost of booth rental to the California Cable Television Association. They were to get a refund of 25 percent of that deposit back if they informed the CCTA they no longer wanted to exhibit by Aug. 24, last Friday.
"We made a very difficult decision to not exhibit at this year's show," said David Zagin, A&E's senior vice president of affiliate sales. "We made the decision in the midst of a difficult ad market. The consolidation and clustering in the market were another factor."
The CCTA is well aware that the current ad crash was the final straw that forced some programmers and technology companies to forego an exhibit. As a result, the trade group has found other ways for them to enjoy some of the show's benefits.
For example, for a $14,000 fee a company can become a "non-exhibitor participant." Benefits include a listing in the Western Show's official program guide and the ability to request meeting space, according to CCTA vice president of industry affairs C.J. Hirschfield.
Rental of an average-sized booth typically costs $14,000, Hirschfield said.
"If a non-exhibitor wants to take advantage of the marketing, the money we've put into this to draw top-quality attendees — and the programmers we've talked to agree with us — then it's more than appropriate to charge a fee to, in effect, 'ante in,' " Hirschfield said. "We think that's fair."
Non-exhibitors can also maintain a presence at the Western Show by buying sponsorships for items and events that range from hotel key cards to the closing Thursday-night party, she said.
The CCTA has already gone to great lengths to make sure MSOs attend its confab, offering discounted association dues and free rooms in exchange for sending their top officials to the show. AT&T Broadband, Adelphia Communications Corp., Charter Communications Inc., Cox Communications Inc, Insight Communications Co. and Time Warner Cable have all taken the CCTA up on its offer.
CCTA is using the presence of those cable-operator executives to lure programmers, who have complained that with MSO consolidation, fewer cable operators come to trade shows and less real deal-making gets done.
In a letter dated Aug. 15, the CCTA told exhibitors that "MSO executives will prioritize exhibitors when scheduling meetings and social events."
Said Hirschfield: "We need to make sure that our exhibitors perceive the value associated with exhibiting. To that extent, do we advantage them in some ways? Yes, we do."
MSO officials set to attend the show have gotten that message, as well, according to Hirschfield.
"We're making this special effort to get these people to the show, so there were some expectations that we put out there for them," she said. "And they understand that. We've asked them to spend a lot time floor and respectfully requested they give serious consideration to events produced by our exhibitors."
But former Western Show exhibitors aren't returning for a number of reasons, aside from MSO consolidation and the soft ad market. The technology industry is suffering a well-documented downturn.
And mergers have left a thinner field of industry vendors. BET is now part of Viacom, for example, and The Walt Disney Co. is buying Fox Family. Some other former Western Show exhibitors — such as MoreCom Inc. and Future Networks Inc. — have also been acquired by larger cable players.
So instead of booths, some of these companies are opting for lower-cost hotel suites and sending fewer employees. It can cost a programmer from $300,000 to more than $1 million to mount a booth at the Western Show; those expenses include renting the space, transporting and storing the exhibit and constructing it on-site.
Hirschfield laments the fact that vendors have dropped out of the show, but understands the financial constraints they face.
"I'm hugely disappointed, because a lot of these people are my personal friends," she said. "And it is the economy. I have friends who have been laid off. So this is just a very tough time.
"So I'm very respectful of the tough business decisions being made. I want them back, too."
WHAT THE NETS SAY
MTVN is not taking a booth at the Western Show because it is consolidating its efforts "to have the broadest impact and [for] the National Show [in New Orleans]," according to an MTVN spokeswoman. The programming giant said it will send executives to the Western Show, but does not yet know how many.
This year A&E Networks — which includes The History Channel, History Channel International and The Biography Channel — plans to send Western affiliate sales staffers from its Denver and Los Angeles offices to Anaheim, according to Zagin, but won't send as many corporate staffers.
Rainbow Media Group was expecting to take less floor space in order to cut its costs, according to a source.
Another source claimed that Disney Channel wasn't exhibiting this year, but CCTA director of public affairs Paul Fadelli said that parent Disney/ABC Cable Networks was just looking to downsize its booth.
An ABC Cable spokesman said: "We're committed to being part of the show. We're working with the CCTA to determine exactly what that participation is."
And at deadline last Friday, a spokesman for Turner Broadcasting System Inc said, "Turner is still considering all its options as for attendance at the Western Show."
The CCTA has set an Oct. 26 for exhibitors to post a deposit for the 2002 Western Show. But with companies now in such a financial pinch, the association may push back that that early deadline, which was originally requested by some vendors, according to Hirschfield.
IN WITH NEW FIRMS
Though this year's show has lost many veteran exhibitors, it has gained 85 new ones, according to Fadelli. Right now, the Western Show has roughly 390 exhibitors on board, — including those involved with the CableNET technology showcase — compared with 473 total last year.
Behind all of the Western Show booths and meetings will be CableNET, a technology showcase organized and operated each year by Cable Television Laboratories Inc. CableNET, which exhibits future and present cable technology in action, routinely draws top industry decision makers.
The number of vendors participating in CableNET so far is roughly equal to or slightly less than how many were on board about this time last year, estimated CableLabs senior vice president of communications Mike Schwartz.
Last year's CableNET drew about 70 displays, with some vendors offering more than one exhibit. Thus far, CableNET has between 50 and 60 vendors on board for 2001, Schwartz said.
While vendors do pay a fee to participate in CableNET, they spend much less to help cover exhibit space and associated handouts and materials than they would on a separate booth presence. On top of that, MSO CEOs and chief technical officers typically make it a point to stop by the CableNET area, Schwartz said.
Schwartz — who noted that this year's edition will give interactive-television a higher profile — said CableNET could provide a lower-cost option for networks that have opted not to assemble a booth, but have ITV products that they want to promote.
R. Thomas Umstead contributed to this story.