‘R’ Word Mostly on Mute at CTAM Summit
November 12, 2008 11:47 AM
Speakers at the CTAM Summit in Boston largely ignored the elephant in the room, the “R” word, as they put one foot in front of the other, discussing present and future trends.
And why not? Was there anyone in attendance who didn’t know how deeply entrenched this recession has become?
But in the closing session Tuesday, Merrill Lynch analyst Jessica Reif Cohen said that while there is a perception that cable is recession-proof, in fact it’s actually more recession-resistant. She said cable does better than most businesses because of its strong cash flow and ability to recover more quickly during recessions, but she didn’t expect a recovery for cable until the first quarter of 2010.
Clearly cable is no General Motors, begging at the Federal Treasury window, but it is challenged. A marketing exec at a cable network said cable will get hit hardest in ad sales, as the industry is already experiencing overall weakness in the scatter market. She also told me her marketing budget is already tapped out for the year.
CTAM Summit attendance was high, about 2,222, down just slightly from last year’s event, said CTAM President Char Beales, who declared the event a “huge victory in this environment.”
And what an environment it is. One multisystem operator’s marketing head told me her company has a “recession plan” at hand, as the company is experiencing no growth from new subscribers.
Perhaps more sobering is the ongoing reduction in headcount at both cable distribution and programming companies, with Cox Cable trimming its workforce by 2%.
One executive search firm executive told me that by year’s end, cable could see a staggering 40% total loss in jobs, counting earlier streamlining moves made during the past several years, first by the programmers and later by the MSOs, with more whacking to come by Q4.