MSOs Tout Cable’s Advantage in Tech

Dec 8, 2003  •  Post A Comment

A panel of multiple system operator heavyweights agreed last week that satellite providers represent a major threat to the cable industry. But most panelists said the technical capabilities of the cable platform give them a long-term advantage-if they can get their collective act together enough to educate consumers.
“There needs to be more discussion about the strengths of our video business-we’re going to have VOD and HD and all these things in our bundle that [satellite] has a tough time delivering,” Carl Vogel, president and CEO of Charter Communications, said during the opening session of the final Western Show, held in Anaheim, Calif.
Time Warner Cable Chairman and CEO Glenn Britt agreed. “We have a reputation of having bad service and a worse platform than satellite,” Mr. Britt said. “It’s easier to get a bad reputation than a good one.”
Such contrite self-flagellation was common among the executives, who seemed to agree that the industry can and should do a better job of self-promotion. Several cited strengthening ties with electronics retailers such as Best Buy and Circuit City as one of the best methods for reversing churn.
“We need to do a much better job of developing those relationships, which provide a third-party confirmation of what we’re doing,” said Bill Schleyer, chairman and CEO of Adelphia.
Most of the MSOs already have such relationships. Time Warner Cable, Cox Communications, Adelphia and Comcast have partnerships in certain markets that promote their service to HD set buyers.
“You’re going to go into Circuit City and buy a panel with high definition and we’re in 4,000 stores with the salesman,” said Brian Roberts, president and CEO of Comcast. “We’re going to give you reasons to come back. We’re going to say, `Here’s the Super Bowl in hi-def.”’
Mr. Roberts urged the other panelists to embrace the deployment of a universal cable box that customers could obtain in stores and use in any system. The box would give cable a tangible product to market against satellite receivers.
“Cable can have a national presence if you can get a cable box in the store,” he said.
Moderator Larry King brought up another technological issue-DVR-asking how the operators plan to balance the needs of advertisers and subscribers. Most agreed that shunning the digital video recorder is not an option.
“We can’t deny them the technology. If we don’t provide it, then somebody else will,” Mr. Schleyer said.
Mr. Britt concurred. “It’s not going to go away,” he said. “It’s going to be in millions of homes. We’re going to have to find a different way to do advertising and technology that works with it.”
Panelists addressed the cost of airing sports on television, pledging to put sports channels-ESPN, in other words-on tiers if costs continue to rise. Mr. Roberts noted that carriage costs are now “double the salaries of all the employees in the industry.”
On the optimistic side, Mr. Roberts noted that most technology is working for cable operators rather than against them.
“What you’ve got down on the exhibit floor are 50 entrepreneurs trying to make our technology better for the next generation,” he said.