Rutledge: Fox Fight 'Unpleasant,' But Necessary

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As the dust continues to clear from Cablevision Systems' two-week retransmission-consent battle with Fox Networks, the MSO's top operations executive told analysts Thursday that the dispute was "unpleasant," but necessary.
Fox Networks pulled its New York and Philadelphia broadcast stations from Cablevision on Oct. 16 after they could not reach a retransmission-consent agreement. The dispute was resolved on Oct. 30, but only after a series of increasingly nasty exchanges in the press.
"It's a very unpleasant way of doing business, having a major conflict like that in public," Cablevision chief operating officer Tom Rutledge said on a conference call with analysts to discuss the MSO's third-quarter results.
"Our behavior was not uneconomic," Rutledge continued. "...We think we did the rational thing."
For the quarter, revenue rose 5.6% to $1.8 billion and adjusted operating cash flow increased 3.6% to $661.7 million in what is traditionally Cablevision's weakest quarter as its customers in resort areas on Long Island and the New Jersey shore leave for their primary residences. Not including a one-time adjustment, AOCF in the period would have risen 8%.
Basic subscribers declined by 25,000 in the period and Cablevision added about 9,600 high-speed data customers and 9,300 phone subscribers.

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On the conference call, Rutledge added that the company is set to launch its long awaited Remote Storage- Digital Video Recorder product in the New York area in the fourth quarter, and plans to cease buying DVR set-top boxes once the product is fully rolled out in the footprint. He added that the RS-DVR would be a "whole-home DVR" product.

Cablevision also plans to launch its PC-to-TV product, called Optimum Link - this month for about $4.95 per month. The product will allow Cablevision customers to relay whatever is on their home PC to their TV using only the existing network. Coming soon is a free interactive multi-player gaming service and iO Photos, which allows customers to transfer their Facebook photos to their televisions.

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