The cable trade association in New York has become the unusual beneficiary of a state attorney general sting against teen smoking.
Attorney General Eliot Spitzer's office bought $300,000 worth of advertising time on systems throughout the state. And that was only one of the six-figure ad deals the Cable Television and Telecommunications Association of New York has negotiated for its members so far this year.
The association approached the state's top law enforcer after the execution of a sting operation designed to smoke out merchants who illegally sell cigarettes to teens. The fines collected as penalties for those infractions, according to law, are designated for programs to educate youngsters on the evils of smoking.
John Higgins, vice president of operations and municipal affairs for the association, said the trade group approached the attorney general's office with 2-for-1 offer. Member operators agreed to run one extra commercial for every one purchased by the tobacco fund.
Additionally, the association explained to law enforcement that the ads could be efficiently targeted on cable networks or during individual shows that were most likely to reach teens.
Since the six-week ad flight ran in the first quarter-a traditionally slow period for ad sales-few operators lost revenue from the deal, Higgins said. The extra spots ran in unsold avails.
Not only did the operators gain revenue, but Spitzer held a press conference last month to thank the industry for its role in the campaign.
This was not the first statewide ad deal brokered by the CTTANY. For the past six years, the association has bid for funds dedicated in the budget of the state Department of Health for public ad campaigns. This year, $450,000 ended up in operator coffers, bringing public-affairs income in the state to about $750,000.
The association is not through, either. Earlier this year, the CTTANY produced coverage of the Republican and Democratic state meetings, which was fed to Cable News Network and C-SPAN. Executives are hopeful that the parties will return to cable when it's time to buy election ads, Higgins noted.
In other financial news, the state legislature approved a bill, floated by the association, that exempts digital set-tops and other upgrade-related hardware from the state sales tax.
"The legislature and the governor realize how important our industry is to the telecommunications infrastructure of New York," CTTANY president Richard Alteri said.
Operators have been paying a 4 percent sales tax on digital set-tops and cable modems-an amount cities have the authority to match for a total of 8 percent sales tax on a transaction. Operators must continue to pay until Sept. 1, when the bill goes into effect.
The association estimated that the tax break will save operators $50 million during the next three years. The biggest beneficiaries are Time Warner Cable, the state's largest operator, as well as Cablevision Systems Corp. and Adelphia Communications Corp.