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Cablevision’s Dolan Hopeful About Dispute With TWC

Aug 9, 2004  •  Post A Comment

Cablevision CEO James Dolan on Monday called the programming-fee fight between his company and rival cable operator Time Warner Cable “unfortunate” but said he is hopeful the two multiple system operators will settle their differences soon.

The tussle, which led Time Warner Cable to drop three Cablevision-controlled channels Aug. 1, has entered its second week with no resolution in sight. The affected channels are the MSG Network, Fox Sports New York and the Metro channel.

Commenting during Cablevision’s conference call with analysts to discuss second-quarter results, Mr. Dolan said the proposed programming fee for the channels is “fair and reasonable” and is in fact 30 percent below the average price the Time Warner Cable pays for the YES Network. Cablevision and YES were locked in a similar fight before the MSO was ordered earlier this year to carry the channel.

Meanwhile, Cablevision swung to a second-quarter loss of $187.1 million, or 65 cents a share, compared with a year-earlier profit of $158.3 million, or 54 cents a share, as start-up costs associated with the company’s satellite television business hurt the bottom line and offset gains made at the company’s core cable and programming businesses.

Revenue soared 25 percent to $1.2 billion.

The results were hurt by Cablevision’s launch of the high-definition satellite-TV service Voom, which has garnered 25,000 customers since its launch last October but has generated a second-quarter operating loss of $81.5 million due to costs for subscriber acquisition, content development and operating the service.

The company’s consumer cable business reported a 17 percent increase in net revenue to $730.4 million, while operating income surged 82 percent to $113 million. The growth was tied to more digital cable subscribers, an increase in high-speed data subscriptions and a 24 percent jump in advertising revenue. Cablevision also reported growth in Lightpath, its cable service targeted to businesses.

On the content side, Rainbow Media recorded a 56 percent surge in revenue to $237.4 million and a 44 percent rise in operating income to $70.7 million, largely the result of higher advertising and affiliate-fee revenue.