Kent stepping down from CNN News Group
Phil Kent will leave his position as president and chief operating officer of the CNN News Group at the end of September. Mr. Kent, who had been a leading architect of the management restructuring that promoted him from president of Turner Broadcasting System International to News Group president in August 2000, had found his role significantly diminished after Walter Isaacson was named chairman and CEO of the News Group in July. Though CNN has made clear that Mr. Kent was not pushed out, his exit was not unexpected, nor is he expected to be replaced.
Welch denies influencing NBC election coverage
Outgoing GE chief Jack Welch is denying that he influenced NBC News’ decision to call last year’s presidential election for George W. Bush. At least that is what Mr. Welch is quoted as saying in the October issue of Vanity Fair. “It’s just silliness” to think NBC News personnel could be influenced by anyone, Mr. Welch says in the Vanity Fair article. “The facts are there was a roomful there of young kids all cheering for [Al] Gore and two or three of us cheering for George Bush. That’s all that happened.” Rep. Henry Waxman, D-Calif., has asked NBC to release videotapes that allegedly document Mr. Welch’s election-night behavior. But NBC has made clear that it is not planning to accommodate the lawmaker, even though he has said he will seek a subpoena.
Tennis Channel planned for 2002
A new 24-hour cable network dubbed The Tennis Channel will launch in summer 2002. Network veteran David Meister, whose credits include responsibility for HBO Sports, Cinemax, Financial News Network and The Sundance Channel, is chairman and CEO, and Steve Bellamy, tennis entrepreneur, coach and promoter, is president and founder of the network. Together they will lead the charge with support from investors that include former Viacom heads Frank Biondi, Tom Dooley and Terry Elkes.
Charter sues telco for false advertising
Charter Communications has filed a lawsuit in U.S. District Court in St. Louis, Missouri charging that Southwestern Bell Telephone, a subsidiary of SBC Communications, is “perpetrating a false advertising campaign that deceives and misleads consumers about cable modem Internet service.” Charter has accused Southwestern Bell, which operates in Arkansas, Kansas, Missouri, Oklahoma and Texas, of violating the Lanham Act, the federal truth-in-advertising law, with its “Cable Modem Slowdown” advertising campaign. That campaign is aimed at convincing consumers to choose the telephone company’s digital subscriber line (DSL) service over the multiple system operator’s cable modem. In the suit, Charter calls on Southwestern Bell to stop the ad campaign. The Southwestern Bell TV, print, radio and Internet ad campaign contends that cable-modem transmission speeds slow during peak usage times, and that this is a significant disadvantage in relation to DSL.
House to give digital a kick
The House Commerce Committee isn’t pleased with the snail’s pace of the transition to digital television and plans to hold a hearing this fall to get to bottom of the issue. And the panel, headed by Rep. Billy Tauzin, R-La., plans to hold a hearing in the coming months on must-carry issues, including the debate between broadcasters and cable over digital must-carry and the squabbling between TV stations and satellite services over carriage on dish TV systems, spokesman Ken Johnson said. The lawmaker also hopes the House will vote this month on the controversial Tauzin-Dingell bill, which would deregulate the Baby Bell phone companies to make them stronger competitors against cable broadband providers. The House will be back in session Sept. 5 following the summer recess.
Hearst-Argyle, Belo outlooks changed
While affirming its various debt ratings for the companies, Moody’s Investors Service changed its outlook to “negative” from “stable” on Hearst-Argyle Television and on Belo Corp. based on their high debt to cash flow ratios and the ongoing advertising slump. Recent economic indicators suggest a recovery could be delayed to 2003, limiting advertising-supported media companies’ financial flexibility. Moody’s affirmed Hearst-Argyle Television’s Baa3 senior unsecured and Ba1 senior subordinated ratings and Belo’s Baa3 senior unsecured rating. At stake is Belo’s $1.8 billion in debt securities and Hearst-Argyle’s $1.4 billion in debt securities. Although both closely held companies continue to pay down debt with free cash flow, Moody’s said reduced operating cash flow will strain credit ratios. The companies say those credit calculations will improve into first quarter 2002 as year-earlier financial comparisons become more favorable. Hearst-Argyle recently was given an 18-month extension by its bank group to meet the tightening covenants of its existing bank loan.