A Summit Made for Soundbites

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With the rapid changes in the multichannel-video industry, it's funny how some things haven't changed over the past year.

The CTAM Summit approaches and, being in Washington, D.C., there's going to be a lot of talk about the digital-TV transition and consumer education about what's ahead (the shift from analog broadcasting) and what's already here (high-definition programming transmitted over the air and over cable and satellite).

Phil Schoonover, the CEO of Circuit City Stores, will be on hand, and retailers' difficulties in keeping customers from returning highly expensive HDTV systems could well be agonized over and solutions suggested.

As it happens, last year in Boston a high-up Circuit City executive was on hand, as well, lamenting HDTV after-sale dissatisfaction. Gary Shapiro, head of the Consumer Electronics Association, was in Boston, too, discussing plans for a cross-industry coalition to educate consumers about digital TV and the February 2009 cutoff of analog-TV signals.

That group did get formed — it's called the DTV Transition Coalition and it also includes wireless industry interests, community-interest groups and government agencies. Its early work includes a Web site, www.dtvtransition.org.

That education effort obviously is a work in progress.

But then, so is the sale of cable-based wireline phone service. At last year's summit, research was discussed about how successful the bundling in of phone service has been for the video business (aggressive sellers Cox Communications and Cablevision Systems were seeing video subscriber upticks while others were losing subscribers).

This year, cable phone marketers can claim victory on customer-satisfaction grounds. Remarkably, cable companies rated highest in the latest J.D. Power survey of phone consumers in six regions of the country. That certainly never was the case with video sales.

My favorite quote from our Multichannel Newsdays at CTAM last year was by Jeff Henry, regional vice president of marketing in Time Warner Cable's Texas region. “We're upside down now,” he said during a panel session attended by MCN's Linda Haugsted. “We're a phone company that sells video.” It's all broadband, baby.

Also remarkable, in reviewing what was news at last year's CTAM Summit, is that the satellite-TV industry (even though it only consists of two major players) has been much more volatile merger-wise than cable has been. Last July, EchoStar Communications stock was up on rumors it might be sold to DirecTV, despite regulatory hurdles such a combination would need to clear. As it turned out, control of DirecTV and its 16-million-plus customers is changing instead, from News Corp. to Liberty Media.

MTV Networks CEO Judy McGrath, last year's winner of CTAM's Grand Tam award, made widely quoted hopeful statements about the impact MTVN's broadband programming efforts have had on viewing of the cable channels. It's additive, she said, citing ratings gains at online-active MTV, VH1, Comedy Central and Nickelodeon.

CTAM research this year is bearing out that assessment. According to Nielsen, which studied the subject for CTAM, some 81 million people, or about two thirds of daily Internet users, say they are watching broadband video at work or at home. And a higher percentage of them (33%) said their overall video consumption was up as a result than the segment (16%) that reported watching less television.

So the Internet is not a death sentence for television providers. A comforting message. Not unlike the kind words last year from Intel sales vice president Donald MacDonald.

“You don't have to die,” he assured Summiteers last year, informing them that with such Intel-powered services as home security monitoring, average revenue per subscriber can actually rise.

An update on that front for Mr. MacDonald: Sanford Bernstein & Co. predicts upcoming second-quarter reports from Comcast and Time Warner Cable will show those cable firms have joined Cablevision in the “$100 Club,” meaning $100 in average monthly revenue per subscriber. Thanks to phone sales, of course, not home security.

Will anyone at this year's summit make logical leaps on the order of Freakonomics author Steve Levitt, who drew parallels between marketing cable TV and selling crack cocaine last year?

Probably not. But Mark Cuban of HDNet will be on the closing general session and he's always good for a soundbite, such as this one MCN's Leslie Ellis noted last year about bits and bandwidth: “I'll tell you with complete certainty: No one will be streaming HD video, not this year, not in five years, not in 10 years.”

Or maybe Gary Loveman, the CEO of Harrah's Entertainment, will describe cable-modem service as being addictive as casino gambling.

Forget doubling down, though. Cable is already well into tripling, and even quadrupling, its customers' fun. Check out the Sprint joint-venture session Tuesday afternoon for more on that.

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