CTAM Summit 05: Sapan Chair’s Choice for 2005

Jul 25, 2005  •  Post A Comment

You can trace Josh Sapan’s interest in cable back to a fateful day in 1973 when 23-year-old Mr. Sapan cracked open a book that proved to be prophetic in terms of both Mr. Sapan’s professional career and the future of the cable industry.

The book was Ralph Lee Smith’s “The Wired Nation,” which, when it was first published in 1972, asserted that the advent of cable television would lead to a broad array of television programming. The book grabbed Mr. Sapan’s attention and inspired him to launch his career in cable.

Fast-forward more than three decades and Mr. Sapan, president and CEO of Rainbow Media Holdings, the programming unit of cable operator Cablevision Systems, is being honored with the 2005 CTAM Chairman’s Award in recognition of his leadership of the CTAM Educational Foundation and its centerpiece Executive Management Program at the Harvard Business School, also known as “CTAM U.”

“As one of the original founders in 1996, Sapan envisioned a world class educational program to help industry rising stars meet the challenges of an increasingly competitive marketplace,” CTAM Chairman Len Fogge said when announcing Mr. Sapan’s award. “During his five years as foundation chair, he ensured its financial stability, and unified a dynamic group of industry leaders, who remain committed to making CTAM U. one of the finest programs of its kind, not only in cable, but in the country.”

Mr. Sapan is considered one of the most technologically savvy cable network executives in the industry, who recognizes-and in many cases goes so far as to embrace-the reality that consumers are watching television differently.

He finds himself at the nexus of programming and technology, and he is pressing ahead with advances that have more than a few cable executives scratching their heads.

Indeed, Rainbow has aggressively rolled out a slew of new products designed to take advantage of everything from video-on-demand to high-definition television. And the process doesn’t just involve repurposing existing content: Mr. Sapan has directed the company to develop content specific for these new formats.

“Several things are occurring right now that make [the business] that much more interesting,” said Mr. Sapan in an interview last week with TelevisionWeek. “I think it is the word ‘convergence,’ which has been used over the past several years, but was more prospective than real.

“Today there really is convergence. The walls that were conventionally dividing television from the Internet are diminishing and coming down,” he said.

And Mr. Sapan is taking full advantage. Rather than relying solely on repurposing existing content for VOD or HD, Rainbow has embarked on a plan to develop original content for both services.

On the VOD front, Rainbow has two services it’s offering to cable operators. Mag Rack features content aimed at various interests, ranging from classic automobiles to wedding planning to guitar lessons. Sportskool is Rainbow’s how-to VOD service dedicated to providing coaching and expert instruction for a broad array of sports and fitness activities.

In the high-definition TV realm, Rainbow is marketing Voom HD Originals, 21 HD channels that feature everything from concerts to sporting events to films that are best seen in HD format.

Expect more to come. Mr. Sapan noted that the hard drive is becoming an ever more important component in a consumer’s television viewing experience, thanks to digital video recording devices such as TiVo. Rainbow likely will develop more content geared specifically to viewers who rely on DVRs for their television viewing.

“If we rewind a bit in our history, there was a time when most TV channels were broad-based,” Mr. Sapan said. “But we have gone from linear cable channels to VOD and HD, and we have been creating content specific for that.”

While that book that he read 32 years ago planted the seed for Mr. Sapan to blaze trails, he readily credits people such as Cablevision Chairman Charles Dolan and Cablevision CEO James Dolan for being what he described as forward thinkers who tend to reach conclusions about technology sooner than many in the cable industry.

“Chuck and Jim genuinely have that view,” Mr. Sapan said. “It’s in the history of everything that Cablevision and its subsidiaries have done.”

Indeed, Charles Dolan launched Home Box Office back in 1972 and laid the groundwork for what would become today’s lucrative regional sports channels by putting local sporting events on cable 25 years ago.

With that forward-looking thinking in place, Mr. Sapan said he brought to the table a similar viewpoint as well as a natural curiosity about identifying and mining what he termed “the richest business opportunities.”

Mr. Sapan joined Rainbow in 1987 as president of its national entertainment division. He was promoted to chief operating officer in 1991, overseeing Rainbow’s sports and advertising sales operations. Four years later he became CEO and has helped the unit generate more than $1 billion in annual revenue.

Rainbow Branching Out

Mr. Sapan got his start in cable as a volunteer at a cable system in Pompton Lakes, N.J., where he produced local shows, including one that profiled young filmmakers.

While television remains at Rainbow’s core, Mr. Sapan readily admits that the business he operates is very different from the one he ran 18 years ago.

“Video product was a single product that had several segments,” including basic, premium and pay-per-view, he said. “That service is now becoming increasingly complex technologically because of competition, and not just from video.”

Indeed, Mr. Sapan noted that years ago his business was largely about licensing movies and putting them on Rainbow’s channels, which include AMC, WE: Women’s Entertainment and IFC. Today, Rainbow’s original-programming budget surpasses that of its movie-licensing business.

Further, Rainbow is branching out into other forms of media. Its IFC operation produces and releases several movies a year, Rainbow operates several Web sites that offer services and products geared specifically toward broadband users, and most recently Rainbow converted a New York movie theater into the IFC Center, a movie house that will feature independent movies against the backdrop of a caf%E9; and bar.

As Mr. Sapan sees it, the strategy is part of his belief that the cable TV industry is no longer isolated but in fact finds itself the subject of constant change, thanks to new ways of distributing content.

“The business is precarious by nature,” he said. “One is subject to audiences that are definition fickle. They move where they want to go, and what’s popular today is not tomorrow.”

What’s more, “technologies really do change with greater speed, so consumer behavior can shift precipitously,” he added.

But with all of that change, Mr. Sapan isn’t worried about missing out on a hot new trend.

“I don’t worry that we will miss a rich opportunity,” he said. “We tend to be fairly aggressive.”