Multichannel News, Vote, Oct. 15, 2012 by Ann McGettigan

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Political-Ad Spending Doubles Over Last Election

CTAM SUMMIT PREVIEW

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Digital Ad Agencies Resist ‘Do Not Track’

Orlando Revisited: Interactive Redux

Halloween Is Back … All Month Long

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MCN SNEAK PEEK Check out a video teaser for Cinemax’s new original series Hunted at multichannel.com/Oct15.

Thinking Inside the Box Set-Tops Adapt for Multiscreen-Video World By Todd Spangler

on’t heap dirt on the trusty old set-top just yet. Far from knocking on heaven’s door, set-top and residential video gateway platforms are getting healthy R&D and deployment investments from operators and manufacturers. This is not your dad’s set-top, though: The new breed of boxes embraces Internet Protocol video for delivery across multiple screens. Comcast, for example, is basing its next generation of video devices on what it calls TAKEAWAY the Reference Design Kit, an Set-tops are evolving from open-source software suite fixed-function MPEG receivers to platforms for aimed at letting MSOs rapmultiscreen IP video idly introduce new hardware, software and applications — including IP video services — in a matter of months, not years. The goal is to give operators and their suppliers a tool set akin to Google’s Android mobile operating system. “With the RDK, Comcast is seeding the growth of a community-driven software platform that addresses one of the industry’s biggest problems: the lengthy process of device development and deployment,” Steve Reynolds, Comcast’s senior vice president of customer premises equipment and home networks, said.

Comcast has now lined up a who’s who in the cable settop business to support the RDK initiative, including Arris Group, Cisco Systems, Motorola Mobility, Pace, Technicolor, Evolution Digital, Itaas, and chip makers Broadcom and Intel. Other MSOs evaluating the RDK include Time Warner Cable and Charter Communications. Cable-tech vendors also are winning deals for their proprietary next-gen boxes and related software that provide a stepping stone to IPTV. Midsize cable operator Midcontinent Communications last week announced a deal with TiVo to offer multiroomDVR and multiscreen IP video products across its systems in Minnesota, Wisconsin, North Dakota and South Dakota. Separately, Suddenlink Communications — which first deployed TiVo’s Premiere DVRs in late 2010 — is now offering the TiVo Stream to subscribers in Lubbock, Texas, for $10 per month. The TiVo Stream can pump live TV or DVR content to up to four different in-home tablets, smartphones or PCs simultaneously. Meanwhile, DirecTV last week launched the Genie, a five-tuner DVR with 1 Terabyte of storage and the ability to sling IP video to up to eight TVs via the RVU specification (currently supported only on certain Samsung HDTVs). The Genie is aimed at competing with cable DVRs and Dish Network’s multiroom Hopper DVR. For cable operators, new IP-enabled boxes are an alter-

Suddenlink Communications is offering Lubbock, Texas, subscribers the TiVo Stream set-top, which can pump live TV or DVR content to up to four different in-home tablets, smartphones or PCs simultaneously.

native to the high cost of investing in a full IPTV service today, Morega Systems CEO Buddy Snow said. “We believe you can use inexpensive hardware inside the home to transcode video” for multiple devices, he said. Snow left Motorola this April to join Morega, which developed DirecTV’s $149 Nomad device to “sideload” recorded DVR content to smartphones, laptops and PCs. At some point, however, industry experts see a day when connected TVs and other devices with enough horsepower to directly receive IPTV will be widely deployed — and cut out the middleman. Marthin De Beer, senior vice president of Cisco’s Video and Collaboration Group, predicts that within about 10 years IP-video devices will eliminate the need for service providers to deploy set-top boxes. Set-top hardware already is becoming a commodity, he said, and the Cisco strategy from here on out is to be “set-top agnostic.” “We are not going to de-emphasize set-tops,” he said. “But what we are going to do is work hard to make sure our software works across any platform.” )

Halloween Comes Early — and Stays By R. Thomas Umstead

ith Halloween growing in popularity among adults — it’s the second-biggest retail holiday after Christmas — nearly a dozen cable networks are offering Halloween-themed marketing and programming stunts throughout the month of October. Network executives hope the Halloween stunts — which include everything from horror-based movies and original programming to network-sponsored haunted houses — help scare up new and younger viewers looking for a frightful thrill. “Halloween is not just for kids anymore,” Thomas Vitale, executive vice president of programming and original movies for Syfy and Chiller, said. “There are adult parties, horror movies in the theaters and on television — it’s become something for everyone. There’s no agenda to Halloween

— there’s no cultural significance, and it’s not a religious holiday. It’s really a secular celebration for everyone.” Indeed, the growing popularity of the Halloween season is downright scary. More than seven in 10 Americans will spend nearly $80 on decorations, costumes and candy, up from $72 last year. Overall Halloween spending is expected to exceed $8 billion in revenue this year, according to the National Retail Federation. Actress Morgan Fairchild attributes consumers’ willingness to spend money on Halloween decorations in spite of a tough economic environment to their need to escape everyday problems. “The two things you can count on when there’s a recession and people want to escape: You’re going to have comedies and you’re going to have horror films,” Fairchild, who is starring in Syfy’s orig-

inal movie American Horror House, part of the network’s “31 Days of Halloween” promotion, said. “Those are the great things that take people out of themselves and take them to another place,” she added. The consumer appeal of Halloween is not lost on the cable industry. In addition to Syfy, networks such as AMC, TCM, ABC Family, BBC America, Starz and Disney Channel are offering Halloween-themed programming and marketing stunts, most of which are already up and running. Kids-targeted Disney Channel, for example, last week premiered most of its “Monstober” Halloween-themed episodes for such hit shows as A.N.T Farm, Good Luck Charlie and Jessie, as well as its original movie Girl vs. Monster. Turner Classic Movies (TCM) has already begun airing classic horror films, such as 1945’s House of Dracula and 1968’s

TCM will revive the 1931 classic Frankenstein.

Night of the Living Dead, every Wednesday night in October, said TCM senior vice president of programming Charles Tabesh. The network’s annual “Classic Horror” offerings will culminate with a 24-hour classic horror movie stunt that will include the original Frankenstein (1931), The Mummy (1932) and The Wolf Man (1941) movies. AMC kicked off its 16th annual Fearfest stunt with the Oct. 14 debut of hit series The Walking Dead. )

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Ad Agencies Oppose Default ‘Do-Not-Track’ By John Eggerton

WASHINGTON — The largest digital advertising group said it opposes a default “do not track” setting on Microsoft’s new browser. Last February, the Digital Advertising Alliance got praise from the Federal Trade Commission and the Obama administration for agreeing to a browserRep. Ed based do-not-track option that would Markey (D-Mass.): allow Web users to opt out of behaviorConsumers al advertising and would be respected should have to agree to be across those participating in DAA’s selftracked. regulatory program, which DAA pegged at about 90% of its members. But that was an opt-in program. Microsoft is making “do not track” the default setting in its forthcoming Explorer 10 browser. DAA has been nervous about that prospect since it was announced in early June and last week, as the browser launch neared, put its collective foot down. “Allowing browser manufacturers to determine the kinds of information users receive could negatively impact the vast consumer benefits and Internet experiences delivered by DAA participants and millions of other websites that consumers value,” the DAA said. Two of the most active House members on the privacy front said that is simply a defense of putting profits ahead of privacy. Reacting to DAA’s line in the digital sand, Privacy TAKEAWAY Caucus co-chairs Ed Markey (D-Mass.) and Joe Barton (R-Texas) said if consumers want to be tracked, they A key adverstising trade group is opposing Microsoft’s decishould have to affirmatively agree to it, something the sion to make “do not track” a two congressmen have been pushing for in a bill targeted browser default setting. at protecting children’s online information. Reps. Markey and Barton gave advertisers some credit for their voluntary guidelines, but said those were not enough and legislation would be needed to establish stronger privacy laws. Elsewhere on the privacy front: • Sen. Jay Rockefeller (D-W. Va.), the chairman of the powerful Senate Commerce Committee, has sent letters to Reed-Elsevier (Lexis-Nexis), Spokeo, Experian and a half dozen other data brokers seeking detailed info on how they compile and sell consumer information. “Collecting, storing and selling information about Americans raises all types of questions that require careful scrutiny,” Rockefeller said. “While these practices may offer some benefits to consumers, they deserve to know what’s being collected about them and how companies profit from their information.” Rockefeller wants answers by Nov. 2. • A coalition of groups last week warned the Federal Communications Commission to be careful how it collects and/or shares consumer online information as part of its consumer broadband-speed tests. In a letter to FCC chairman Julius Genachowski, the Competitive Enterprise Institute, TechFreedom, Center for Media and Democracy, and more than a half-dozen others said they were concerned consumers were turning over information to the government that could be used to “review” their Internet activity “without due process or judicial scrutiny.” The groups are worried the test gives the FCC too much access to personal information without enough checks and balances. The FCC did not have a comment at press time. • The National Telecommunications and Information Administration has scheduled the next mobile app stakeholder meeting for Oct. 16 in Washington, D.C. The NTIA is trying to come up with guidelines for mobile app privacy as part of the Obama administration’s privacy Bill of Rights. • A decision is expected almost any day on whether the FTC will pursue an antitrust suit against Google for dominance in search and online advertising. )

10 stories that matter 1

Campaigning on Cable

Local ad spend for cable operators will double this year with Congressional and presidential political ad s (see page 20).

TV Spend to Fall in ’13

After gorging on record levels of political spending in 2012, (see above) TV advertising is expected to have a hangover drop in 2013, according to Magna Global (see multichannel.com/Oct15).

Long Live the Box

Set-tops are evolving from fixed-function MPEG receivers to platforms for multiscreen IP video (see page 2).

Liberty’s War Chest

After transactions involving its Starz and Sirius XM holdings, Liberty Media may be sitting on a $4.5 billion war chest that could be used for acquisitions or to repurchase shares (see page 12).

TV Dominates Debates

More than one in 10 (11%) viewers “dual-screened” the first presidential debate, according to a new Pew study, but the vast majority (85%) were TV-only viewers (see multichannel.com/Oct15).

Reps. Dis DAA

Leaders in Congress say the Digital Advertising Alliance is “putting profits over privacy” after the group decided not to recommend that its members honor the default do-nottrack regime baked into the new Microsoft Explorer (see this page).

New Slingbox Flings HD

EchoStar’s Sling Media launches a wacky new box to fling HDTV as well as personal photos and video to TVs, tablets, PCs and smartphones over the Internet (see page 38).

Starz a Seller or Buyer?

Liberty Media chairman John Malone fueled speculation that its Starz premium channel may merge with another larger programmer after a planned spinoff later this year (see page 12).

Univision’s VOD Plans

The company will unveil its new bilingual online network, UVideos, on Oct. 15, with ondemand programming and a social TV experience on a variety of devices (see multichannel.com/Oct15).

Nothing But Nets

Regional sports service YES Network hopes the basketball Nets’ cross-river move to Brooklyn brings increased ad revenue and ratings (see page 30).

in this issue 24

PEOPLE & CALENDAR

PLATFORMS

FREEZe FRAME

MCN BUZZ

CONTENT

COMMUNITY

RULES

Viewpoint

FINANCE

Through the Wire

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CTAM Summit Preview

Orlando Revisited

In 1994, Time Warner Cable debuted the Full Service Network interactive cable system during a high-risk launch event in Orlando, Fla., site of this week’s CTAM Summit and SCTE Cable-Tec Expo. Much-hyped and much-maligned, FSN’s longer-term positive influences are becoming clearer today. By Craig Leddy

n suburban Orlando, Fla., hundreds of onlookers packed into a Sheraton Hotel ballroom off Interstate 4 to witness something that had never been seen before: a two-way digital-cable system capable of streaming video-on-demand movies and interactiveTV applications, including home shopping, video games and, yes, ordering pizza delivery. It was Dec. 14, 1994, and it marked the official launch of Time Warner Cable’s Full Service Network, an historic undertaking that helped to produce many of the digital innovations that the cable industry profits from today. On the hotel ballroom stage, Jerry Levin, Time Warner Inc.’s chairman and CEO at the time, and Jim Chiddix, then the chief technical officer for the cable division, prepared to click a remote to launch FSN and demonstrate the power of interactive digital cable. The audience could not have realized how difficult it was for the FSN developers to have reached this point, nor how uncertain it was for the launch to go off as planned. “I was nervous as hell,” Chiddix said in a recent interview. “I knew way too much about what was behind the curtain. We were leap-frogging technologies in several dimensions, which was risky. There was lots that could go wrong. And I was pushing the button seemingly in front of every journalist in the Western world.” Ever since Levin had announced the FSN plan in January 1993, the project had been beset by technical hurdles and delays. Nearly every key component had to be created from scratch. Time Warner wanted to demonstrate the advantages of digital technology, but first there had to be digital technology to demonstrate. Twenty years ago, there were no digital set-top boxes, digital video transport equipment or even digitized movies for VOD. FSN software engineers had to write more computer code than it took to land a man on the moon, as Joe Collins, then the chairman and CEO of Time Warner Cable, told the hotel audience. For set-tops — if you could call them that — developers mashed together a Scientific-Atlanta converter and a Silicon Graphics Inc. Indy workstation to create large Home Communications Terminals that the cable company said cost about $4,500 each. Despite the difficulties, Levin believed deeply in cable and interactive media and pushed the project onward. As the launch event began, he told the audience, “Sooner or later, every significant player in the information and entertainment industry is going to have to

A young viewer orders up a movie via Time Warner Cable’s Full Service Network in Orlando, Fla., circa 1994.

understand the implications of broadband interactivity.” FSN, he said, was “an irreversible step across the threshold of change.”

No Animals On Roller skates Then, Levin and Chiddix sat down in front of a widescreen TV while the audience watched on a giant projection screen. “This is not hype. We’re on the cable system,” Levin explained. “There are no animals behind here on roller skates.” After conducting a brief closed-circuit discussion with Jim Ludington, who oversaw construction of the FSN network-operations center (NOC), it was showtime. The future of Time Warner and the cable industry was in Chiddix’s hand as he aimed the remote. If the network crashed, the developers recall, they were to throw a switch to run backup demos, including a complete demo on Laserdisc. They called it the “Oh Jesus” switch. “Well, Jerry, let’s just turn on our television and …” The hushed ballroom watched nervously as a blue-andwhite FSN logo came onto the screen, followed by loud,

FSN Achievements From 1994 to 1997, the Full Service Network in Orlando pioneered digital cable advances, including: u The first streaming of full-motion digital MPEG video over cable plant to a television set; u The first launch of true two-way VOD service, including movie ordering, rewind, fast-forward, pause and play functions; u A proving ground for HFC architecture, QAM modulation, digital set-top management, transport and two-way communications; u Development of new user interfaces, interactive program guides, VOD menus and TV remote-control navigation; u Creation of interactive-TV applications including shopping, games, news, sports, advertising, banking and ordering services. Source: Time Warner Cable; Interactive TV Works research

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agenda swirling music and colorful shapes that formed into the FSN’s Carousel on-screen navigator, turning to offer Movies, Shopping and Games. It worked! The audience burst into applause. It was a moment of elation and relief that FSN developers say is one of the highlights of their lives. Watching from the NOC, Ludington called it “spine-tingling.” Then Levin scared the engineers by going off of their script and taking the remote from Chiddix. He ordered The Specialist, a new Warner Bros. movie; hit fastforward, and then paused it where actress Sharon Stone places a flower on a grave. Then he ordered a second movie, The Client, so that two movies were being held on the network simultaneously. The two executives went into a Warner Bros. virtual store and bought a pair of Bugs Bunny caps, then played gin rummy remotely with the Willards, America’s first FSN family. When they returned to The Specialist, there was Sharon Stone placing the flower on the grave. The network performed flawlessly. The Oh Jesus switch and the backups never had to be used, the developers said. Another hotel room exhibited early prototypes of HBO On Demand, Sports Illustrated TV and a planned music service fronted by rock musician Todd Rundgren, present in red-and-black checked clothes. Nearby, reporters could tour the Home of the 21st Century, an upscale 3,700-square-foot house full of home-automation electronics that were presided over by a virtual on-screen butler named Alfred. That night, developers held a victory celebration at the Home of the 21st Century where some were pushed into the pool. “Hijinks ensued,” Chiddix recalled.

Compared to Kitty Hawk

Many of the applications were for pay and most found an audience, developers said. Ordering stamps from the Post Office, in the days before email took off, reportedly was the most popular interactive commerce application. And yes, users could place orders with Pizza Hut on TV. But FSN was too expensive to roll out on a mass scale, developers said. In April 1997, Time Warner Cable announced it would phase out the trial, take its lessons and apply them to VOD and Pegasus, a digital cable plan that Ludington called “the deployable FSN.” The company has never disclosed FSN’s total costs, only saying that it was a worthwhile investment in research and development. At the time of the phase-out announcement, press reports quoted anonymous sources who estimated the total cost to be about $300 million to $500 million. After all of the hype, industry observers debated over whether FSN was a harbinger of the future or a gigantic waste of time and money. Detractors and competitors derided FSN as having accomplished little more than the ability to order pizzas by TV.

Media outlets around the world hailed FSN. USA Today declared: “The future of television landed in a tiredlooking Sheraton outside Orlando.” A cable trade-magazine editor compared the Orlando launch to Kitty The Lessons of FSN Hawk. With the passage of time, FSN’s implications are beOver the next two and half years, FSN rolled out coming clearer. to a trial market of about 4,000 “The FSN has had so many inhomes in Orlando’s northwest fluences on the industry today,” suburbs. Customers could orsaid Yvette Kanouff, executive der VOD movies; play networked vice president of engineering and games against neighbors; shop technology at Cablevision Systems, using Spiegel and other catalogs; who was part of the FSN software access Orlando Sentinel news; engineering team. watch time-shifted soap operas; “We learned about digital setget sports statistics and check top boxes, which ended up turntheir bank accounts. ing into the SA Explorer 2000,” she Ford and Procter & Gamble said. “We learned so much about tested interactive advertising, but VOD management, which turned FSN’s small audience size yielded out to be the VOD standards of a limited track record, developthe industry. Network infrastrucers said. ture and modulation techniques FSN even tested a Web-on-TV are still implemented today.” service and telephony using perDevelopers learned about con“The billions of dollars sonal communications service sumer behavior around user inter(PCS), a wireless technology, said generated from what we faces and interactive applications, Mike Hayashi, now executive vice learned in Orlando is she added. president of architecture, devel- pretty hard to count.” In addition to digital video, opment and engineering at Time Mike LaJoie, executive vice presiWarner Cable. dent and chief technology officer Mike LaJoie, TIme warner CABLE

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Time Warner Inc. chairman and CEO Jerry Levin unveils the Full Service Network at the Orlando, Fla., launch event.

of Time Warner Cable, called FSN “the germination point” for the company’s high-speed Internet and telephone services. LaJoie, who was involved in FSN from its earliest days, said the engineers tested data and voice technologies and realized their product potential there. “It was the foundation for so much rich entertainment and information communications product that it’s phenomenal. The billions of dollars generated from what we learned in Orlando is pretty hard to count,” LaJoie said. Daniel Howard, senior VP and CTO of SCTE, noted that FSN relied upon integrated, network-based services and now MSOs are taking a similar tact with IP-based service delivery. “It really was a cloud before there was a cloud,” he said.

The Great Motivator To appreciate FSN today, it has to be put into historical context, said Chiddix, who is now semi-retired and sits on company boards. In the early 1990s, he recalled, cable’s prospects were fading and it had a great motivator: fear. Cable faced emerging all-digital competition from direct broadcast satellite, while Bell Atlantic, under chairman and CEO Ray Smith, was preparing an interactive TV service. Congress re-regulated cable in 1992 and many system owners were selling out. The World

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agenda Chiddix said he and the Wide Web was being developed. company management wantThe Digital Age was dawned to push the prospects for ing, the Information Superemerging HFC (hybrid fiber cohighway was being paved and axial) architecture. They realcable either could become a ized that true VOD could be a leader or become road kill. Cabig hit, based upon a near-VOD ble used digital technology to offering on a 1 GHz service take a bold stand. John Malocalled Quantum in Brooklyn, ne’s Tele-Communications Inc. N.Y. embraced digital compression But they underestimated and the 500-channel universe how difficult it would be to imwhile Viacom Cable began deplement the requisite technoloveloping an interactive service gies, Chiddix said. in Castro Valley, Calif. Cable, computer and teleMeanwhile, Wa ll Street communications engineers was scrutinizing the debt load had to combine their technolfrom the 1989 merger of Time ogies through “brute force inInc. and Warner Communica- “Half a Terabyte of storage tions. Levin, who had recent- took up half a room back then tegration,” said Ludington, now executive vice president ly succeeded the late corporate and now it takes half a rack.” of national network operachairman Steve Ross, saw the tions at Time Warner Cable value of new technology as a Jim ludington, time warner cable and program chairman of this lead player in HBO’s pioneering launch on satellite in 1975. An interactive cable sys- year’s SCTE Cable-Tec Expo in Orlando. FSN relied upon HFC and 1 GHz of bandwidth for tem could unite the divisions and brands of the Time Warner empire — home video, movies, music, maga- analog channels, digital services and a high-end return zines, video games, television and cable assets — in a path. To route digital video, it used one of the first ATM (asynchronous transfer mode) switches ever built. global bid for digital domination.

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The VOD-server technology seems laughable by today’s standards. The NOC, Ludington recalled, contained “huge cabinets of 3- and 6-Gig drives. Half a Terabyte of storage took up half a room back then and now it takes half a rack.” Tom Feige, FSN’s president, struggled to assimilate developers from the different cultures of cable, telecommunications and Silicon Valley. “We were all talking different languages during the first year or more,” Feige, now CEO of Internet-security firm idRADAR, said. For example, when the cable guys said “programmer” that meant a cable-TV network person, but to Silicon Valley developers, that meant someone who wrote computer code.

A Marketing Playground FSN became a trial market — and a marketing playground — for young executives like Bob Benya, now president and CEO of In Demand. Benya was thrust into multiple roles, including working on an interactive program guide to “stop that incessant scrolling,” stocking the Home of the 21st Century with home-automation electronics and developing an “FSN University” training program for employees. Since the HCT was big and had accessory components, including a Hewlett-Packard printer and an

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agenda In certain respects, LudAtari game player, special conington said, “Lean-forward soles had to be built and installed technology won over lean inside homes. The task of getting back.” the consoles fell to Benya. Many think FSN became “So now I was in the furniture a victim of its own hype. business,” Benya said with a laugh. Feige noted that the origi“You can’t make this stuff up.” FSN nal plan in 1993 was to cre“really opened our eyes and emate a deployable service, boldened us to understand what then it got recast as a trial, was important for the consumer: and then the trial was decontrol, convenience and choice,” layed. The expectations did he said. not match the actual develFSN became a mecca for “exopment cycle, he said. ecutives, politicians and royalty” who toured the facilities, Benya said. Along with their Walt Disney More Credit Today World souvenirs, they could take Today, FSN’s accomplishhome FSN Frisbees, pens, caps and “[FSN] really opened our ments are getting more credother premiums. it and Time Warner Cable eyes and emboldened us to As the Web’s potential rose, understand what was important says it is benefiting from its developers learned what would results. for the consumer: control, work better using the Internet Last year, 17 years after rather than TV. For outside con- convenience and choice.” the launch, Time Warner tent creators, producing interacInc. and Time Warner Cative content using the Internet’s BOB BENYA, IN DEMAND ble (now separate corporate open standards and ubiquity beentities) were honored with came more attractive than developing interactive TV an engineering Emmy, the Philo T. Farnsworth Award, for a closed cable environment. crediting FSN as “the forerunner to robust video-on-de-

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mand and other entertainment and communications services consumers enjoy today.” Time Warner Cable executives said they transferred FSN’s lessons into the development of digital set-tops, network architecture, VOD, program guides, interactive applications and broadband service. Many of those involved with FSN hold top leadership positions today, including Glenn Britt, chairman and CEO of Time Warner Cable, and Carl Rossetti, president of Time Warner Cable Ventures. FSN alumni populate many parts of the industry today. There is an FSN alumni group on LinkedIn. Today, Levin is reticent about his role in the early days of digital cable, saying he defers to the “many dreamers” who made it happen. He serves as chairman of StartUp Health, which supports health and wellness entrepreneurs. He recently moved to Maine and enjoys his 10 grandchildren. Beyond the technology, FSN is a story of human achievement. Hundreds of people from different walks of life came together to overcome odds and create innovations in a relatively short timespan. The experience produced a vibrant spirit that FSN alumni still talk about today. ) Craig Leddy attended the FSN launch as editor of Cablevision magazine. Today, he is president and senior market analyst for Interactive TV Works.

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Liberty’s War Chest: $4.5B Malone thinks ‘a little like a hedge fund’ By MIKE FARRELL

epa/andrew gombert

NEW YORK — After the dust settles with transactions involving its holdings in premium cable channel Starz and satellite-radio giant Sirius XM, Liberty Media could be sitting on a $4.5 billion war chest that could be used for acquisitions or to repurchase shares, company officials told investors last week. At Liberty’s Investor Day meeting here last Wednesday (Oct. 10), Liberty chairman John Malone said the media giant was looking at all its options. “In the short run, we’re probably going to think of ourselves a little like a hedge fund,” Malone said. “In the longer run we want to make strategic investments in growth cashflow businesses.” Malone said Liberty has a list of possible targets that it continuously looks at and evaluates. “Meanwhile, you just look for opportunities to get decent returns with the cash you’ve got on hand,” he said. “That’s kind of the posture that we’re in pro forma.” Other potential uses for the cash could be repurchasing its own stock and acquiring a bigger stake in the companies it already has a less than 100% interest in, like home-shopping giant HSN Inc. and travel companies Expedia, Interval Leisure Group and TripAdvisor.

“We have a pretty good array of existing investments where it’s entirely possible to increase our stake if we think that is a superior return to shrinking our own equity, which is always the first choice if you can’t find anything better,” Malone said. The Starz spinoff is moving ahead and should be completed by year-end, creating a standalone, asset-backed stock for the premium channel and a separate asset-backed stock for Liberty’s remaining assets, like the Atlanta Braves Major League Baseball team, satellite company True Position and minority stakes in several media companies (see story, this page). The bulk of Liberty’s potential $4.5 billion war chest will come from Sirius XM, in which Liberty holds a 49.6% interest. Liberty has been making moves to gain control of Sirius — it asked the Federal Communications Commission in August to take outright control of the company — and has been acquiring stock on the open market for most of the year. Liberty CEO Greg Maffei said at Investor Day that the media giant has acquired 611 million Sirius shares on the open market for about $1.4 billion this year alone. Liberty acquired a 40% stake in Sirius in 2009 as part of a $530 million loan it issued the then-struggling company. But Liberty expects to be paid back for the high cost-basis stock it acquired on the open market over the past few years.

Liberty Media’s John Malone: “You just look for opportunities to get decent returns with the cash you’ve got on hand.”

That repayment will likely take the form of a dividend, according to Pivotal Research Group principal and media and communications analyst Jeff Wlodarczak. Once Liberty gains control of Sirius, it could spin off the company in a Reverse Morris Trust transaction, which would allow for a tax-free distribution of the Sirius stake to shareholders and a simplified structure for Sirius. Maffei estimated that it would take Sirius at least 18 months to complete such a buy. “We would want to get our capital out before we do a Reverse Morris Trust,” Maffei said, adding it is not a given that this is the path Liberty will ultimately take. “If it takes 18 months, that would be sort of a minimum.” )

Starz Could Use Post-Spinoff ‘Big Brother’

ty, which would be renamed Starz and would trade under the symbols “STRZA” and “STRZB.” The spin is expected to be completed before the end of the year. Speculation of a possible future sale ran high shortly iary, to be called Liberty Media, that would consist of all By MIKE FARRELL Liberty assets other than Starz — including interests in after the spinoff announcement, with some reports that NEW YORK — After its planned spinoff by the end of the Sirius XM Radio, Live Nation and Barnes & Noble, as well Time Warner Inc.’s Home Box Office unit or CBS’s Showyear, premium channel Starz could find itself paired up as its stake in the Atlanta Braves Major League Baseball time Networks could be possible suitors. Other possible suitors include Comcast (which controls the NBCUniteam — to current Liberty shareholders. with another programmer. Starz, which has about $1.5 billion in debt and an unde- versal partnership), News Corp., The Walt Disney Co. Liberty Media chairman John Malone added fuel to speculation that the Starz premium channel may merge termined amount of cash, would remain in the old enti- and Netflix. Starz has been on a roll in the past several with another larger programmer after a years, growing cash flow by 16.7% since 2009, planned spin-off later this year, saying at LibStarz the Limit while revenue has risen a slightly disappointerty’s annual Investor Day meeting here Oct. Premium channel Starz has grown at a healthy clip since 2009 ing 1.9% over the same period (see chart). Starz 10, “Everybody can use a big brother.” ($ in millions): has about 20 million subscribers — up from 16 “There are substantial synergies for Starz million in 2008 — and has focused on creatworking together with various potential Revenue $2000 ing its own original programming. media partners,” Malone said. “One of the OIBA $1,626 $1,628 $1,615 Earlier on Investors Day, Albrecht said opportunities that we are creating by sepa$1,540 the goal is still to create 50 hours of origirating it is for [Starz CEO] Chris [Albrecht] 1500 nal programming by 2015. Already the chanand the board to explore other relationships. nel has launched the successful Spartacus Unfortunately, other than financial syner1000 gladiator franchise — the final installment, gies, Liberty really can’t provide Starz with Spartacus: War of the Damned, is coming in much in the way of operational synergies in $449 $451 500 $343 January — as well as Boss and Magic City. Pethis space in the U.S.” $283 riod drama Da Vinci’s Demons is slated for a Liberty in August announced its inten0 spring 2013 debut, while production is extion to spin out Starz into a separate, publicly 2009 2010 2011 2012* pected to begin next year on miniseries Martraded entity. The transaction would involve * Estimate. Source: Starz co Polo. ) the distribution of shares in a new subsid-

Agenda_PG_12A.indd 2

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10/11/12 6:36 PM

agenda

Breaking Bigger Campaigns

TWC Media’s Gillman on Political, VIDEO-ON-DEMAND Ads Regardless of how the 2012 elections play out, cable is getting a healthy cut of the adspending action. (See Cover Story, page 20.) Joan Hogan Gillman, president of Time Warner Cable Media, sees political tracking well and is bullish on other opportunities for the industry — including, after years of waiting in the wings, video-on-demand ads. She spoke last week with Multichannel News technology editor Todd Spangler.

Q&A

MCN: How is 2012 political ad spending tracking versus four years ago? Joan Hogan Gillman: I think it’s tracking extremely well. It is tracking exactly where we hoped it would, and the key difference between ’12 and ’10 and ’08 is that we have done a much better job of informing political candidates early enough to benefit from more primary money. … We have more activity around local races than national, but the key difference is the role of the super PACs, which were very active in the primary months.

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MCN: So is TWC up by double digits over 2008, as other operators have reported? JHG: Our third-quarter results are coming out soon, and the leaders of our company will clearly talk about how important political is for our Q3 results. MCN: Ohio must be doing well for Time Warner Cable. JHG: We have three swing states: Ohio, North Carolina and Wisconsin. They’re all seeing good activity. MCN: What’s the footprint for dynamic ad insertion for VOD across TWC? JHG: Inside our footprint, everything is installed. All the equipment is in place. For the purposes of saying we can do dynamic VOD, I can do that on the sales channels I own and operate. The campaign manager is where the final work is being done. From our perspective, it is a godsend that we are stripping away the manual processes with automated systems. When it comes to Canoe [Ventures, jointly owned by TWC and five other MSOs], the current footprint enabled for the national networks is a subset of our full footprint, but it is very, very close to having it everywhere.

MCN: After years of talking about VOD advertising, are we finally on the cusp of something big? JHG: I think so. My own personal view “We have more is VOD has been a activity around great asset for the local races than cable industry. VOD advertising has been national, but the key a long time in com- difference is the role ing. It is absolute- of the super PACs, ly in the interests of which were very the programmers to active in the take advantage of that. We were first primary months.” in the industry to JOAN HOGAN GILLMAN, do Start Over, so we TWC MEDIA can prove that having advertising in time-shifted content is not going to be a deterrent — consumers value convenience over the ad load. )

10/11/12 6:30 PM

specialsalute

Women Of technology

Making a Difference In Technology

ith the Society of Cable Telecommunications Engineers’ Cable-Tec Expo in Orlando, Fla., this week (Oct. 17-19, with a preconference symposium on the digital home on Oct. 16), Multichannel News is again spotlighting some women who’ve made significant achievements in technology positions in the cable industry. The honorees are from cable operations at the national and regional levels; a programmer; a tech vendor; and an “up and coming” executive in any of those realms. They are, respectively: Yvette Kanouff, executive vice president, corporate engineering and technology, Cablevision Systems; Carolyn Terry, senior director, engineering operations, Time Warner Cable Los Angeles; Roxane Kerr, VP of technology, C-SPAN Networks; Sangeeta Ramakrishnan, principal engineer, Cisco Systems; and Ebony Lee, VP, mobility solutions, Comcast. They were interviewed by technology editor Todd Spangler and technology analyst Leslie Ellis.

Kanouff

Cable Operator: National Yvette Kanouff

CABLE Operator: Regional Carolyn Terry

EVP, Corporate Engineering and Technology Cablevision Systems

Senior Director of Engineering Operations Time Warner Cable Los Angeles

Yvette Kanouff is no stranger to these pages — she’s had a storied technology career on both the MSO and vendor sides of the industry. In March, Kanouff, 46, was named technology executive vice president at Cablevision Systems, and is leading the company’s groundbreaking work on network DVRs, strategic Wi-Fi and advanced user interfaces. (The multiscreen “Onyx” guide launched on Oct. 3.)

Carolyn Terry, 48, defines the category of the hands-on engineer: She’s developed, integrated and deployed all sorts of things, from wiring hubs to launching highspeed data, digital video and on-demand. At press time, she was slamming to prepare for a weekend final for the MBA she’s pursuing at University of Phoenix; when that’s done, she wants to do more volunteer work with youth.

MCN: First job in cable? Yvette Kanouff: At Time Warner Cable, to launch the Full Service Network in Orlando (see page 4). It was a great time in our industry — [we] were just moving to digital and creating two-way cable networks. I was a mathematician and software developer in an RF world. It was a lot of fun. MCN: First job in technology? YK: Lockheed Martin (at the time Martin Marietta). I started as a student coop, and ended up working there for 10 years. By the end I was a senior radar engineer, focused on compression and pattern recognition algorithms. MCN: Kids, cats, dogs? YK: Four beautiful children, awesome husband, two cats, one dog. MCN: Tech people you look up to? YK: Jim Ludington, executive vice president at Time Warner Cable, for bringing me into cable. Also Wilt Hildenbrand [senior adviser/engineering and technology, for Cablevision] for being an enabler and for helpings others to succeed and rise to their potential. Last but not least: Steve Jobs, for being an inventor and thinking outside of the box.

MCN: When did you know for sure you were destined to be in tech? YK: In eighth grade, when my mathematics teacher made me solve an equation in front of the class. I was so nervous, and then realized that this stuff is a lot of fun! MCN: Stuff you’ve built or rebuilt? YK: A radar system on an Apache helicopter … and, of course, building and bringing video-on-demand to the cable market. MCN: The thing that drives you the most crazy about engineers/technologists? YK: It’s important to see the world (products, services, business drivers, etc.) that technology fits into — many times, we see technology as the center of the universe. MCN: The thing that drives you most crazy about non-techs? YK: Their frustration that technology is not error-free. MCN: Top three things on your work to-do list for the rest of 2012? YK: Launching our new Cablevision user interface, enhancing our monitoring and management tools and several new technology launches. — Leslie Ellis

MCN: First job in cable or first job out of college? Carolyn Terry: First job in cable and out of college was as a cable installer for Comcast in 1986. MCN: First job in technology? CT: I’d say that my first deep dive in technology was in 1997, as an engineer for Comcast, working on one of the first launches of digital cable services. MCN: Kids, cats, dogs? CT: Dog. Riley, golden retriever, 5. MCN: Tech people you look up to, and why? CT: Wayne Hall [regional VP of engineering at Comcast] is a great mentor and straightforward leader. He has a wonderful sense of humor and always knows just the right thing to say, at the right time, to anyone seeking advice. Plus he’s a great engineer — one of those people who can break anything down to its simplest form. Jim Ludington, because of his pragmatic approach to decision-making and his strong sense of technology. And he understands operations and what it takes to deploy and deliver new services to the customers. MCN: When did you know for sure you were destined to be in tech?

CT: In 1989. I had only been in the business a few years. I had a thirst for knowledge and an imagination for what we could be as an industry. I just knew there was a reason that I wound up in cable. MCN: Stuff you’ve built or rebuilt? CT: Oh, I’ve built and rebuilt many things over the years. Several hub and headend facilities. I’ve spliced fiber, and rebuilt HFC plant and strand after major wind and fire storms. VOD, switched digital video, DOCSIS 3.0, an ITV test lab — all are things I’ve built and deployed. I’m most proud, however, of the teams I’ve built and developed over the years. There’s no greater reward than watching someone you’ve mentored reach their highest potential. MCN: Top three things on your work to-do list for the rest of 2012? CT: Complete the buildout of four new hubs and relocate customers to the new hubs. We’re also completing the expansion of the switching pool to 24 QAMs in the Southern California area, and we’re activating A-DSG (Advanced DOCSIS Services Gateway) on our Cisco DNCSs (Digital Network Control Systems). How’s that for some tech talk? — Leslie Ellis

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10/11/12 6:38 PM

Women 0f Technology

Terry

Ramakrishnan

Lee

Kerr

vendor Sangeeta Ramakrishnan

Up-and-Comer Ebony Lee

Principal Engineer Cisco Systems

Vice President, Mobility Solutions Comcast Cable

Sangeeta Ramakrishnan is perhaps best known for a prescient paper she wrote, in April of 2009, called “Scaling the DOCSIS Network for IPTV.” At the time, everyone (including Bill Gates) was encouraging cable to go not just “all digital,” but “all-IP” (meaning Internet protocol). Three and a half years later, her assessments remain true and are becoming business as usual in the transition to IP. Ramakrishnan, 41, earned a bachelor’s degree in electronics and communications from the College of Engineering Guindy, Anna University, Chennai, Tamil Nadu, India (where she met husband Ram), and a master’s degree in electrical engineering from the University of California.

Ebony Lee has been on technology’s bleeding edge for more than a decade — and stands to be in the thick of things at Comcast for the next several years — even though she says she’s personally not a “techno geek.” She oversees business strategy and program management for the technology joint venture with Verizon Wireless. Lee, 36, previously worked in Comcast’s Converged Products group, where she helped develop the business case and strategic plan for the IP-based video platform now called X1. She holds an M.B.A. from Harvard Business School and an undergraduate degree from the University of Virginia.

MCN: First job in cable or first job out of college? Sangeeta Ramakrishnan: First job in cable was as in software engineering for VBits, a statistical remultiplexing vendor; first job out of college was in software engineering for Compression Labs, a video-conferencing provider. MCN: First job in technology? SR: Research in video compression algorithms. MCN: Kids, cats, dogs? SR: Daughter, Anika, 6. MCN: Tech people you look up to and why? SR: Bill Gates, for his philanthropy. MCN: When did you know for sure you were destined to be in tech? SR: High school. In India, by your sophomore year in high school, you are required to self-select into math and science, biology, the arts — I was good at math, and I liked it. So I picked math and computer science. MCN: Stuff you’ve built or rebuilt? SR: Mostly video delivery products — first over MPEG, and now over IP. MCN: Who would you have dinner

with, alive or dead, tech or not? SR: Leonardo da Vinci. MCN: The thing that drives you the most crazy about engineers/technologists? SR: When they ignore the business implications of technology. MCN: The thing that drives you most crazy about non-techs? SR: When they want everything — yesterday. MCN: Top 3 things on your work to-do list for the rest of 2012? SR: Wi-Fi for service providers; IP video; next-generation edge architectures. MCN: The weirdest question/observation about your career/job? SR: “How can you spend three days looking at cables?” — in response to telling a non-techie friend that I was headed to the Cable Show. MCN: The worst thing about being the lone female in the room? SR: It’s a reminder that things haven’t changed much in the last 20 years. Here’s hoping this will change in the next 20! — Leslie Ellis

MCN: First job out of college? Ebony Lee: My first job out of college was working as a management consultant for A.T. Kearney. I had several nontech projects (e.g., consumer goods and health care) before ultimately deciding to join the Communications and High Tech practice. The beauty of consulting was that it provided me with the opportunity to see a wide spectrum of problems across the industry — and to learn how to approach, evaluate and solve complex issues. MCN: First job in cable? EL: My first job in cable was here at Comcast over four years ago, where I worked on the business strategy team in the Office of the CTO. One of my first major projects included business case development, planning and eventually the launch of Comcast’s next-generation IP video products and platform — now known as the X1 platform. MCN: Tech people you admire? EL: There are many people in technology I look up to, but there’s something that intrigues me about [Intel co-founder] Gordon Moore. When you think about

how most technology innovations wouldn’t be possible without the microprocessor and the predictability of Moore’s Law — it’s simply amazing. And I can’t help but admire his philanthropy as well. MCN: The thing that drives you the most crazy about engineers or technologists? EL: Bridging the gap between finding the perfect technical solution and addressing business issues can sometimes be challenging. MCN: What drives you most crazy about non-techs? EL: Sometimes it’s not as easy for nontechy people to see the role technology actually plays in everything we do. MCN: Top things on your work to-do list for the rest of 2012? EL: For the remainder of the year, I’ll be focused on Comcast’s joint venture with Verizon Wireless, including mobilizing the joint product/technology innovation program, implementing necessary processes and practices and planning ahead for 2013. — Todd Spangler

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10/11/12 6:39 PM

Women 0f Technology

Programmer Roxane Kerr Vice President, Technology C-SPAN Networks Presidential administrations come and go, but Roxane Kerr has held an influential office at C-SPAN for the past two decades. Over the years, Kerr, 53, has led C-SPAN’s evolution from analog to digital video, as well as its introduction of video-on-demand and streaming Internet video. Today, she’s overseeing C-SPAN’s conversion to all-HD distribution, as the 2012 election season hits its apex this fall. MCN: First job in cable? Roxane Kerr: My career in the cable industry began as an intern at C-SPAN in 1982. At that time, at the fledgling network, I had the tremendous opportunity, with no real experience, to run camera and audio for coverage of congressional events. Eventually, I became a director and crew chief, and then was promoted to director of field operations responsible for managing a large team and, for the first time, for making decisions on technology. In 1992, I moved into engineering (now called “technology”), and the rest is history. Twenty years later, I am responsible

special_report_PG_16-17-18 16

for the entire technical infrastructure of three television networks, our radio station, our multiple websites, satellite distribution and internal IT. MCN: When did you know for sure you were destined to be in tech? RK: I knew that I had an interest in and a knack for technology within my first year at C-SPAN. My goal out of college was to get a job, pay my dues and look for an opportunity to move into reporting and on-air work. But I was fortunate that my internship was in the field and I quickly realized how much I enjoyed the tech side of the company. The exposure to C-SPAN’s field equipment and the

technology for moving television signals fascinated me. Pretty quickly, I was good at it and good at describing or teaching others about technology. MCN: Stuff you’ve built or rebuilt? RK: I have directed multiple rebuilds of the technical facilities for TV production and distribution, including analogto-digital and now our conversion to HD. We have rebuilt the physical plant several times to include new HVAC [heating, ventilation and air conditioning] and electrical systems and generators. Currently, the networks’ Technical Operations Center is being upgraded and completely redesigned (and moved to a new level within our building) to facilitate all-HD and a new information and production content management system. MCN: The thing that drives you the most crazy about engineers/technologists? RK: They know more than I do! MCN: Wht drives you most crazy about non-techs? RK: They think they know more than I do. MCN: Top three things on your work

to-do list for the rest of 2012? RK: One, support our multiplatform coverage of C-SPAN’s Campaign 2012 (debates, election night, inauguration and our upcoming original First Ladies series). Two, complete the install of new video servers as the final phases of our conversion to HD. And three, launch a new integrated information and production content-management system. MCN: Any kids, cats or dogs? RK: My husband Mike and I are blessed with two fantastic kids. Much to the chagrin of my C-SPAN team, we did not name them “Uplink” and “Downlink.” Our oldest, Ryan, is a 2011 graduate of Duquesne University and is working for an issue-advocacy company specializing in social media for clients in D.C. Kathleen is a freshman at Duquesne majoring in communications. MCN: The weirdest question about your job? RK: Everyone I know thinks I have some secret “inside track” to the political goings-on, Capitol Hill gossip and who will win the election. I just tell them to watch and decide for themselves. — Todd Spangler

10/11/12 6:40 PM

coverstory

Candidates Vote Cable Political-Ad Spending Doubles Over Last presidential Election

s Election Day draws near, political candidates are increasingly turning to a single medium to carry their message and hopefully sway undecided voters: cable TV. Political ad spending was supposed to break records in 2012 and it hasn’t disappointed — according to research group Borrell Associates, political ad revenue for cable was expected to double to $938.8 million from $468.8 million in 2008. Cable networks are not expected to be the only beneficiaries of the growth in political ads. MSOs have advertising avails — generally, about two minutes of advertising time per network per hour — that they can sell to anyone they want. That inventory can be sold to political candidates and with targeting technology advancements made in the past few years, ads can be directed to specific neighborhoods of an MSO’s territory, making cable operators an increasingly attractive alternative.

By MIKE FARRELL

Opening up the floodgates was a 2010 U.S. Supreme Court ruling — Citizens United v. Federal Election Commission — which said the government could not restrict political spending by corporations and unions. As a result, political action committees have significantly increased spending. Borrell Associates senior analyst Larry Shaw estimated that about one-third of the total TV ad cash has been spent by the respective campaigns. Traditionally, candidates save the bulk of their TV ad budgets for the last few weeks before Election Day. And as Nov. 6 approaches, candidates are increasingly targeting their messages to attract what they see as their weakest demographics.

LATE SURGE

coverStory_PG_20-21 10

REUTERS/Gilbert Bellamy

For both candidates, that will likely mean their ad money will shift to the battleground states of Colorado, Florida, Iowa, New Hampshire, Nevada, Ohio, Virginia, Wisconsin, Michigan, Minnesota, New Mexico, Pennsylvania, Missouri and North CaroliTARGETED SPOTS na. With President Obama running neck and neck “Cable can deliver ads to groupings at the node level, with Republican challenger Mitt Romney, the focus allowing campaign managers to surgically target their will most likely be on undecided voters and ads to get advertising not to battleground states, but to battlepeople to the polls, as some pundits expect a low votground neighborhoods,” Sanford Bernstein cable and er turnout. President Obama (l.) and Republican nominee Mitt Romney satellite analyst Craig Moffett wrote in a recent research square off at an Oct. 3 debate in Denver, which improved Romney’s At Cox, which operates in two battleground states standings in the polls. report. “Predictably, cable MSOs have captured a higher — Nevada and Virginia — the ad activity has been and higher share of political ad spending with each election.” robust. Davis estimated that ad revenue in those states is pacing between 35% and According to a recent report by ISI Group media analysts Vijay Jayant and David 40% ahead of 2008. Joyce, Comcast is expected to lead the pack in political ad revenue, reaping about “We’ve never seen this amount of activity ever going into Nevada,” Davis said. $200 million in the current election cycle. Shaw said that political ad revenue could rise even higher for cable networks and At the Goldman Sachs Communacopia investor conference last month, Comcast operators, but added that the real growth may be for online ads, which have faster chief financial officer Michael Angelakis said the MSO expected a healthy increase response times and can be targeted equally at specific segments. in political spending. Continued 0n page 22 “We will have a good third quarter in advertising and fourth quarter due to political that comes every two years,” Angelakis said. Jayant and Joyce wrote that Charter Communications has the most exposure in Show Me the Money the battleground states (about 45.6%), but other large MSOs have a significant presWhile the media’s focus may be on the Presidential election, Borrell forecasts that the bulk of ence in those areas as well. political spending (48.4%) will be by Political Action Committees funding senate and CongresThe analysts noted that there has been little political ad spending in those areas sional races. to date — part of the reason it expects Charter to reap jut $26 million in political ads. “That said, Charter could see a late-cycle surge of ad revenue in those key states,” ■ Party/PACs: $4.78 billion 4.9% Jayant and Joyce wrote. ■ State/Local: $2.21 billion Charter officials declined comment. At Cox Media — the advertising unit of Cox Communications — vice president of ■ Presidential: $1.62 billion national accounts Brian Davis estimated that political ad revenue will be up about 22.3% ■ Issues: $0.48 billion 25% from 2008. ■ U.S. Senate: $0.48 billion “Cable is really coming of age,” Davis said in an interview. He added that although 48.4% candidates have taken advantage of Cox’s targeting capabilities in past elections, ■ U.S. House: $0.31 billion this year they are casting a wider net, spreading their messages not just in tradition3.1% al sources like news channels, but in general entertainment networks as well. “In 2008, the majority of political spending was in 10 to 15 networks,” Davis said. 4.9% SOURCE: Borrell Associates “Obama alone is at least 35 networks deep [this year]. People are moving deeper, not because we’re driving it. It’s part of the plan coming in.” 16.4% While cable is obviously growing its political pie nicely, is still represents just about 10% of overall political ad spending this year. Borrell estimates that in total, political ad revenue will top $9.9 billion in 2012, with more than half of that ($5.6 billion) earmarked for broadcast TV.

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10/11/12 7:04 PM

Political Capital ISI Group analysts Vijay Jayant and David Joyce estimate that Comcast will be the biggest MSO winner on the political ad front, given its greater geographic reach. Here’s how they think the other major operators stack up: ($ in millions)

Company

2012E*

2008

% Change

$199

$132

50.9%

TWC

$88

$67

31.6%

Charter

$26

$23

11.9%

53%

$33

$26

26.5%

21%

$362

$259

39.7%

Comcast

Cablevision Cox Mediacom TOTAL Note: * Estimates

Source: ISI Group estimates, company reports

Political ARPU

Battle Royal

Cable operators are expected to reap the benefits of increased advertising revenue in the current election cycle. Sanford Bernstein cable and satellite analyst Craig Moffett’s estimates of average monthly advertising revenue per customer for three top publicly traded MSOs (Comcast, Time Warner Cable and Cablevision Systems):

$8 7 6

ISI Group expects political spending to be focused in Colorado, Florida, Iowa, New Hampshire, Nevada, Ohio, Virginia, Wisconsin, Michigan, Minnesota, New Mexico, Pennsylvania, Missouri and North Carolina as Election Day nears. Here is each MSO’s exposure in the so-called

“battleground states”:

Company

% of subscribers in battleground states

Comcast

35.1%

2 1 0

Time Warner Cable

29.4%

Charter

45.6%

Cablevision Q1

Q2 Q3 2008

Q3 2009

Q2 Q3 2010

Q2 Q3 2011

Q1 Q2 2012

2.6%

Source: ISI Group estimates, individual company reports

Source: Company reports, Sanford Bernstein estimates and analysis

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10/11/12 7:05 PM

coverstory News You Can Use

Projected Political Ad Spending

Cable networks continue to lead the pack as a source for consumers to get political news:

Spending for political ads is expected to double this year for cable networks, according to research house Borrell Associates:

% 50

Local Newspaper

($ in millions) 2008 Political 2012 Political % Spending Spending Change Newspaper

$546

$699.5

28.1%

Other Print

$97.5

$174.9

79.4%

$4,319

$5,640.3

30.6%

Cable

$468

$938.8

100.6%

Radio

$552.5

$819.2

48.3%

$247

$377.4

52.8%

$227.5

$285.3

25.4%

$22.2

$159.2

615.6%

$500.5

$744.8

48.8%

$6.980.9

$9.939.5

40.9%

Broadcast TV

Out of Home Direct Mail Online Telemarketing TOTAL Source: Borrell Associates

Internet

Network TV News

Local TV News 20

Cable News Source: Pew Center Campaign News Survey, Borrell Associates

Continued from page 20 “One of the big shifts and trends we’re seeing with online advertising right now is that targeting capability. A lot of Romney ads are showing up on Facebook,” Shaw said.

LOCAL CABLE SPEND Shaw added that cable operators and networks may see the most growth in local races. Across the country, races for 33 Senate and 435 Congressional seats, gubernatorial races in 11 states and many other state and local offices should eat up substantial airtime. Shaw noted that the Democratic National Committee has made the House and Senate races a priority, adding that a significant Democratic victory could help end the stalemate between both houses — (Democrats currently control the Senate with

2000

2004

2008

2012

51 seats but Congress is dominated by Republicans with 240 seats.) “All the political spending this year isn’t in the presidential election, it’s also in the local elections as well,” Shaw said. “That’s really where you’re seeing the increase in cable. Even four years ago you didn’t have quite the local targeting capability with cable that you do now. I think we’re seeing that increase in cable just because of that ability to target at a local geography level by the state and Senatorial candidates.” Davis agreed that cable’s targeting capability has helped drive ad revenue, especially in state and congressional races. California, for example, has been one of Cox’s hottest political ad markets, with several state propositions on the ballot and 53 House seats up for grabs. Davis added that in state races, Cox’s targeting capabilities have been especially popular; adding that about 35% of every overall political ad dollar is spent on targeted ads. “This year has really been about growing in share and a targeting capability that no one else has,” Davis said. “People are taking advantage of that.” )

Candidates Spend Big for Small Audiences advertising on a handful of Politicians are increasingly swing states around the counvoting for cable networks to get their political ads out to the try with an emphasis on key demographics such as young voting public. voters, minorities and women. Once the domain of local Cable — with its ability to hone broadcast stations, cable netin on select viewers with niche works are now integral parts of programming networks — ofa candidate’s overall political “It’s an fers an alluring platform by ad-buy strategy. amazing growth which to target key viewers, And while most of the ad acrate versus the said cable-network executives. tion is from cable operators using last election.” “There is a lot more activlocal avail time, the industry JEFF LUCAS ity than there’s been before overall is grabbing a bigger piece MTV NETWORKS and we’re in contact with both of the political ad-dollar pie. campaigns multiple times a Borrell Associates estimates that $938 million will be spent for cable- week,” Jeff Lucas, head of sales for the Viacom Media Networks/Music and network ads this year, a 100% increase Entertainment Group, said. “When you from the $468 million that was generthink about, it these two gentlemen ated in the 2008 presidential campaign. have grown up within the MTV generaThat’s nearly 10% of all political ad tion and they know the power of the spending, compared to only 6.7% just a year ago (see chart, this page). brands.” MTV in particular has seen a “tripleThe presidential candidates in particular have concentrated much of their digit” increase in political ad revenue

coverStory_PG_20-21 12

this year compared to 2008, Lucas said, as politicians look to court young, Millennial viewers. Lucas said that MTV reaches 45 million Millennial viewers — including a significant number of African-American and Hispanics in the 12-to-32-year-old age demo. “It’s an amazing growth rate versus the last election,” he said. “They know where the audience is — not just MTV, but all across the MTVN networks, which they offer every demo from diapers to diapers with the millennial [demographic] being most popular.” Other networks, while less forthcoming with their political ad numbers, say that they’ve seen a small uptick in ad spending, although most executives say that spending is on the local level through cable avails sold by cable operators. Niche networks Lifetime and TV One reported little to no increase in political advertising activity. — R. Thomas Umstead

| m u l t i c h a n n e l n e w s | O c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 7:06 PM

people NBCUNIVERSAL Rajal Lele was elevated to vice president, business affairs at Bravo Media, Oxygen Media and Style Media at NBCUniversal. She had been director, business affairs. Also, Wanda Bradley was elevated to vice president, sales, NBCUniversal Television Canada.

AMC Cable network AMC has named Aleksandar Stojovic and Scott Stein to the post of vice president, business affairs. Stojkovic comes from production firm The Angel City Factory; Stein was head of business affairs and operations at Oprah Winfrey’s Harpo Films. COMCAST Comcast has tapped DID YOU KNOW? Henry “Hank” Fore Comcast East Bay was one of the a s reg iona l senior San Francisco Business Times’ “Top 5 Places to Work” for three vice president for Calstraight years durng Hank Fore’s ifornia. He had been tenure as area VP. regional SVP of Comcast’s Oregon/Southwest Washington region.

FORE Comcast

YANOVER Fandango

SOUND DEVICES Pat McConnell was named sales manager at Sound Devices, a Reedsburg, Wisc., provider of audio and video products for field production. He comes from AudioBiz, where he was a manufacturer’s representative.

CROWN MEDIA Crow n Media Fa mily Net work s ha s na med Randy Pope vice president, programming of Hallmark Channel and Hallmark Movie Channel. He comes from Larry Levinson Productions, where he was senior VP, production and development.

TIME WARNER CABLE Time Warner Cable has promoted Greg King to senior vice president, business services product and strategy. He had been group VP, business services strategy. Also, Stephanie Anderson has joined TWC as senior vice president, marketing for business services. She comes from Cablevision Systems, where she was VP, commercial markets marketing and advertising.

FANDANGO NBCUniversal-owned movie-related website Fandango has tapped Paul Yanover as president. He UNDERWOOD Insight comes from Disney Online, where he was executive vice president and managing director.

WFN WFN: World Fishing Network has upped Carlos Baez to vice president, content distribution. He had been senior director, affiliate sales and will remain based in Atlanta.

SILVERMAN NATPE

WOHLER Robin Melhuish was tapped as senior sales executive, RadiantGrid, at Wohler Technologies. He comes from Reliance MediaWorks, where he was head of production.

INSIGHT STRATEGY Insight Strategy Group has elevated Phillip Underwood to manager from analyst. NATPE The National Association of Television Programming Executives has promoted Pamela Silverman to director, operations and exhibitor services. She had been manager, operations and event services. McCONNELL Sound Devices

DID YOU KNOW? Robin Melhuish is a former documentary producer for BBC Radio who also reported on the crisis in South Africa.

melhuish Wohler

SUBMISSIONS: Send people and calendar items to Michael Demenchuk, Multichannel News, 28 E. 28th Street, 12th Floor, New York, N.Y. 10016 or via email to MCNPeople@nbmedia.com.

Calendar

OCt. 15 Multichannel News and B&C, CTAM Summit Breakfast: “How to Successfully Promote VOD and PPV to Cable TV Viewers,” Orlando, Fla. Contact: Contact: Sandy Friedman, (917) 281-4718 or sfriedman@ nbmedia.com.

OCt. 18 SCTE Cable-Tec Expo, Orlando Orange County Convention Center, Orlando, Fla. Contact: Lori Bower, (610) 363-6888 or lbower@scte.org.

people_PG_24 18

WICT Tech It Out, Orange County Convention Center, Orlando, Fla. Contact: Marilee Peterson, (703) 234-9804 or mpeterson@wict.org.

OCT. 21-26 Betsy Magness Leadership Institute (BMLI), Class 27 Orientation, Greensboro, N.C. Contact: Marilee Peterson, (703) 234.9804 or mpeterson@wict.org.

OCT. 29 2012 B&C Hall of Fame, WaldorfAstoria Hotel, New York. Contact: Sandy Friedman, (917) 281-4718 or sfriedman@nbmedia.com.

Nov. 12-14

Nov. 14-15

Betsy Magness Leadership Institute (BMLI), Class 26 & 27 November Session, Crystal Gateway Marriott, Arlington, Va. Contact: Marilee Peterson, (703) 234-9804 or mpeterson@wict.org or visit http:// www.wict.org/programs/bmli/.

Betsy Magness Graduate Institute (BMGI), Crystal Gateway Marriott, Arlington, Va. Contact: Marilee Peterson, (703) 234-9804 or mpeterson@wict.org; visit http://www.wict.org/programs/ bmlialumnae.

Nov. 12-13

Nov. 14-16

Virginia Cable & Telecommunications Association, Virginia Cable Show 2012, Hilton Virginia Beach Oceanfront, Virginla Beach, Va. Contact: Kim Voxland, (804) 7801776 or kvoxland@vcta.com; visit www.vcta.com.

WICT Executive Development Series, Hyatt Regency Coconut Point, Bonita Springs, Fla. Contact: Marilee Peterson, (703) 234-9804 or mpeterson@wict. org.; visit http://www.wict.org/ programs/eds/.

| m u l t i c h a n n e l n e w s | O c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 6:42 PM

freeze frame At the Los Angeles premeire of mun 2’s Larrymania (l. to r): actor Rafael Amaya; Flavio Morales, SVP, programming and production, mun2; Larry Hernandez; Gloria Mel del Solomons, director, programming, mun2; and Sebastian Jimenez, producer, Larrymania.

, rogramming sko, ow (l.), SVP, p Rob Sharen n Latifah; and Steve Mo e e e th u at Q ; n, e levisio Lifetim ny Pictures Te e’s Steel o S , nt e d si tim pre miere of Life New York pre Magnolias.

arnold turn er Stewa rt Volland/Nat Geo WILD

Chris Noth (l.) and Epix CEO Mark Greenberg at the premiere of Epix’s Everything or Nothing: The Untold Story of 007 at New York’s Museum of Modern Art. the o wa rgo/g ett y images for

al Intervention at the Paley Center At the screening of Nat Geo Wild’s Anim al expert Donald Schultz, animal for Media in Los Angeles (l. to r.) : anim EVP and GM Geoff Daniels and Wild advocate Alison Eastwood, Nat Geo ay. moderator Bill Keveney of USA Tod

epi x

FRIT Z Photographics

RLTV and George Washington University’s Face the Facts USA co-hosted a pre-election discussion on Debt and the Deficit. On hand (l. to r.): RLTV chairman John Erickson, former Sen. Alan Simpson, Frank Sesno, Jared Bernstein and RLTV CEO Paul FitzPatrick.

| m u l t i c h a n n e l n e w s | o c t o b e r 1 5 , 2 0 1 2 | multichannel.com

Freeze Frame_PG_26-28-30 20

10/11/12 6:52 PM

freeze frame At The Weather Channel’s “Fall Social” at Standard Biergarten at the Highline in New York (l. to r.): Bryan Matsuoka, Razorfish; Lindsay Gamm, account executive,The Weather Channel Cos.; and Jim Cantore, Weather on-air meteoro logist.

t, chief r.): Curt Hech to (l. al ci o S l er’s Fal VP, sales Also at Weath fficer, and Eric Hadley, S el Cos.; nn eo Weather Cha global revenu arketing, The lvyEntertainment. m d an gy te stra Ogi tt, president, and Doug Sco

t Fete Dress al Give & Ge dent nu an th ur fo At Style’s : Style presi vais event (l. to r,) for Success an Smith, Garcelle Beau m le o C m aa Sal banks. and Selita E

marc bryan -brown photography

Univision news anchors Jorge Ramos (l.) and Maria Elena Salinas receive Lifetime Achievement Awards during y the 33rd annual News and Documentar ner War e Tim ’s York Emmy Awards at New Center.

Veria Living chief marketing officer Michael Snyder (r.) offers some advice to Eco-Chick. com managing editor Lindsay E. Brown during the taping of one of the network’s first Veria Voices segments.

SUBMISSIONS: Send your most recent press photos, with an ID, contact name and telephone number, to: Michael Demenchuk, Multichannel News, 28 E. 28th Street, 12th Floor, New York, N.Y. 10016. Send electronic images (4” X 6” at 300 dpi) via e-mail to: mcnart@nbmedia.com

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Freeze Frame_PG_26-28-30 18

10/11/12 6:54 PM

content

YES Expects a Nets Revival Regional net Gears Up for Pro Hoops in Brooklyn During the 2011-12 NBA season, YES averaged a 0.4 rating in the New York DMA with its Nets’ teleAs the Brooklyn Nets establish the franchise in the casts. Woody Freiman, YES’s vice president of producNew York City borough, regional sports channel YES Network is experiencing ad-sales gains and expects to tion and programming, said Ian Eagle will return as the principal play-by-play man, and will call begrow its basketball tween 50 and 55 games. Ryan Ruocco will add some ratings alongside games to his schedule. Veterans Mike Fratello and the reborn NationTAKEAWAY Jim Spanarkel are back as analysts. al Basketball AssoYES Network hopes viewers and advertisers will believe Ed Delaney, senior vice president of broadciation team. the hype surrounding the move cast operations and engineering, said YES has Fifty-five years of pro basketball’s Nets to always been charged with treating “every Nets after Major League Brooklyn. game as if it’s a playoff game … so that’s been Baseball’s Dodgers bailed on Brooklyn for Los Angeles, the entire city our mantra. We’ve always been out there with a is embracing the pro-hoops squad, as evidenced by lot of hardware.” YES’s Nets telecasts this year will continue to inthe many folks walking around the Big Apple with the Nets’ new black and white colors and logo. The clude 10 cameras for home games, a super slo-mo, new designs were created by rapper and mogul Jay- and robotics behind each basket and on the scoreZ, a part owner in the club, who ushered in the new board. They will add the NBA debut of an improved Barclays Center arena on Atlantic Avenue with a re- YESMo, the ultra slow-mo, high-definition camera, for which the RSN’s Yankees telecasts won an Emmy cent series of concerts. The profile of the team, which had played in New Jer- in 2011. YES’s first regular-season gamecast is slated for sey for the past 35 years, is also on the rise across the Nov. 3 against Toronto, country, via NBA TV docuYES Network’s new Nets opening but subscribers can watch series The Association and 17 incorporates team imagery and pre- and post-game shows contests that will air on naBrooklyn landmarks. flanking the club’s Nov. 1 tional outlets TNT, ESPN opener against the New and NBA TV in 2012-13 and York Knicks on TNT. and point guard Deron WilThat will also mark the liams appearing on the covfirst time viewers will get er of Sports Illustrated’s NBA a look at a new graphics preview issue under the package for openings and headline “Brooklyn Rising.”. bumpers YES is creating YES, the regional-sports in conjunction with the network home of the New Nets and M Factor, the York Yankees, will televise Los Angeles-based crethe Nets’ first home preative design firm that also season game against the produced new looks for the RSN’s Yankees coverWashington Wizards on Oct. 15. YES is already seeage in 2010. ing the benefit of the Nets’ relocation on Madison Creative design director Rick Deutschman preAvenue. viewed some of the new graphics with animated While senior vice president of ad sales Howard depictions of players passing the ball around such Levinson reports that YES is in the process of fiBrooklyn landmarks as Coney Island, Grand Army nalizing deals with other clients, Verizon Wireless, Plaza, brownstomes and the Atlantic Avenue subway Verizon FiOS, Cadillac, GEICO, Nissan and, not surstop before joining together at the base of the Brookprisingly, Barclays will all expand their presence on lyn Bridge and then morphing into the Nets logo. Nets’ game telecasts this season. “In all my years of building graphics or watchThe New York State Lottery is now a part of YES’s ing sports, I have never seen painted characters like account roster, too, thanks to the Nets’ relocation. this,” Deutschman said. “So this is very different.” The RSN is also upping the ante relative to providing He said it was challenging to work around the enhanced coverage via additional cameras and the inblack and white colors at the beginning. “We’re incorporation of fans’ social media tweets and Facebook troducing a couple of tones around it. We didn’t postings, as well as its institutional Twitter feed — @ want it to look like black and white television.” YESNetwork —throughout all of its Nets programming. Although it will not feature a composition from All this should result in an uptick with the Jay-Z, who also helped design the arena’s new “vault” Nielsens. “We expect the ratings to increase signifsuites and 40/40 restaurant, YES is working on asicantly this season, due to the improved roster and sembling Nets theme music that Freiman said will the excitement surrounding the move to Brooklyn,” reflect “a gritty, urban feel.” ) a network spokesman said. By Mike Reynolds

content_PG_30 30

REVIEWS Hunted

Cinemax, Friday, Oct. 19, 10 p.m.

Cinemax will look to follow up its successful original series Strike Back with espionage-themed drama Hunted. The series, produced by X-Files writer and producer Frank Spotnitz, stars Melissa George as Sam Hunter, a skilled operative for global intelligence and private espionage firm Byzantium. Despite being haunted by her emotionally scarring past, things are running smoothly for Hunter until, during a planned rendezvous with love interest and fellow team member Aidan Marsh (Adam Rayner), she’s ambushed, shot and left for dead. After going underground for a year to recover and rebuild her strength — which includes training herself to hold her breath underwater in a bathtub for minutes at a time and running up steep hills — she returns to Byzantium and rejoins her team in an effort to find out which of her co-workers may have set her up to die. Trusting no one, she must walk a fine line of completing the tasks set before her while secretly investigating those closest to her. As Hunter looks to find the truth behind her attack, Hunted also delves into the often shady workings of Byzantium and the often questionable tactics it uses to achieve its goals. As a result, Hunter must often work outside of the system in an effort to complete her assignment as well as snuff out her attacker. The series lacks the fast pace of Strike Back as it takes time to flush out Hunter’s complex personality while defining the characters working with her — including the company’s aloof boss, Rupert Keel (Stephen Dillane), and new and outspoken team member Ian Fowkes (Lex Shrapnel). The slow pace however, helps to contribute to the intrigue of the overall storyline, and is buttressed with several action scenes that add to the series’ overall appeal. Fans of spy shows will gravitate to Hunted, a smart and entertaining series that will further build Cinemax’s reputation for delivering interesting original fare. — R. Thomas Umstead

x More Online For more on Hunted, visit multichannel.com/Oct15.

| m u l t i c h a n n e l n e w s | o c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 6:55 PM

rules

CTAM Summit Preview

C-SPAN Hits the Trail

VP Peter Kiley on Marketing the Jewel in Cable’s Public-Service Crown C-SPAN Networks vice president Peter Kiley is a 20-year veteran of both C-SPAN and the Cable & Telecommunications Association for Marketing, including several years helping plan the latter’s annual conference. He oversees C-SPAN’s marketing team and the effort to get his affiliates credit for the good work they do. As he prepared to make the trip to Orlando, Fla., for this year’s CTAM Summit, Kiley spoke with Multichannel News Washington bureau chief John Eggerton about the challenge of promoting the public-service channel, what C-SPAN considers its “Olympics” and the value of 6,000 Twinkies. Read on.

Q&A

MCN: Give us a little biographical information about yourself. Peter Kiley: I’ve spent more than 25 years at C-SPAN, most of that doing affiliate-relations work focusing on our relationships with distributors, carriage, billing, contracts, legal issues. Much of the value proposition that C-SPAN has with its affiliate base is doing good things in the community with them and helping our affiliates get credit for providing the public service that C-SPAN is. So, I spend a good deal of our time working with our marketing team — Marty Dominguez is VP of marketing, and does all the legwork — our communications group and our community outreach group to get the message out that C-SPAN is not a government channel, that it has never gotten a dime of government money, and that we’re funded by affiliate fees paid by our distributors, including satellite distributors and telephone companies. Because we are a nonprofit, and because we keep those affiliate fees very low, we are not in a position to market ourselves in the traditional ways you see other programming networks do.

At left, the C-SPAN bus visits a campaign stop of eventual GOP nominee Mitt Romney earlier this year. At right, the bus parks outside New Hampshire’s Red Arrow diner.

this since the ’80s that there is a very politically active community in each of those areas. So, for this election cycle, we decided to hyper-target Iowa and New Hampshire during the early campaign season. We did many of the same things in Tampa and Charlotte [site of the Republican and Democratic conventions, respectively], and we’re doing on a little different scale some similar things in [swing states] Virginia and Ohio. What we did in New Hampshire was to go into the state and say that we were going to show New Hampshire’s motivated people, our audience, as well as the politicos in the state, the organizers and even candidates themselves, and the professional media traveling to New Hampshire that C-SPAN is the place for 2012 coverage. We took the C-SPAN Bus to New Hampshire and had it at events where candidates were, the offices they were opening in the state, as well as schools and universities and to the Red Arrow “Much of the value Diner and other places where we knew proposition that political conversations were taking C-SPAN has with place. In the Red Arrow Diner, we put its affiliate base is our logo on coffee mugs, placemats and certain foods. doing good things in

MCN: Which brings us to C-SPAN’s Mark Award nomination for the New Hampshire primary campaign. PK: I think, for us, each campaign cycle, particularly a presidential electhe community.” MCN: Is that the 5,000 whoopie pies tion cycle, is a huge opportunity. PETER KILEY, C-SPAN and 6,000 Twinkies? (See box.) We refer to the couple weeks of the PK: Yes. conventions as our Olympics. But we begin our coverage of the campaigns and start our focus MCN: Are you sure those are the best food choices? on them much sooner than most of the other news Sounds like Michelle Obama might not approve. networks do. So, as politicians begin visiting Iowa, New Hampshire and other primary and caucus states, we start PK: I think those were the choices of Red Arrow Diner of covering those dinners. We know from a history of doing what were good sellers.

Rules_PG_32 22

GRANITE STATE STATS C-SPAN collected some figures on the effectiveness of its New Hampshire primary marketing campaign, which earned it a Mark Award nomination this year: Transit: 2.5 million exposures between various billboards and airport dioramas, beginning in early September through the primary. Interactive media: 1,400 visitors to the CSPAN Bus interacted with the kiosks in New Hampshire, and 7,000 total visitors interacted between its debut and the end of the eligibility period. Collateral marketing materials: 2,500 pieces distributed C-SPAN Bus events: 14 events in nine cities over four days. 1,460 Bus visitors and 24,200 exposures Local partnership: 5,000 whoopie pies and 6,000 Twinkies were sold. 180 mugs were made available to patrons. Source: C-SPAN research

MCN: Why do you go to the CTAM Summit and what is the value of the show for you? I always learn something at CTAM, particularly from the outside-the-industry speakers. I often find some of those the most interesting. And I go for the networking. With fewer and fewer events on the annual calendar where the industry gathers, I really value the opportunity for the hallway conversation, the cup of coffee in the morning to see people that I normally wouldn’t in my regular visits to our distributors have a chance to see. )

| m u l t i c h a n n e l n e w s | o c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 6:57 PM

finance

Dish, Gannett Hop Past Skirmish Ad-Skipping Feature Doesn’t Hold Up Retrans Deal

Dish Network had claimed Gannett Broadcasting was trying to squelch the ad-skipping feature on its Hopper whole-home DVR (pictured).

By MIKE FARRELL

Dish Network and Gannett Broadcasting manTAKEAWAY aged to hammer out a The economic retransmission-conimplications of Dish Netsent deal last week, dework’s ad-skipping Auto Hop technology weren’t spite the satellite-TV enough to derail a giant’s contention that retransmission-consent pact the broadcaster was trywith broadcaster Gannett. ing to squelch its controversial Auto Hop ad-skipping technology. Terms of the deal were not disclosed. The agreement, reached a few hours after the formal midnight Oct. 7 deadline passed (both sides agreed to a brief extension as talks continued) kept Gannett stations in 19 markets, including Washington, D.C.; Atlanta; Denver; and Phoenix, Ariz., on Dish Network’s service. In a terse statement issued Oct. 8, Gannett Broadcasting said it had reached an agreement, but declined further comment. Dish would only confirm the Gannett statement and also declined further comment. That approach was a bit different than just a few days earlier, when Dish had issued statements accusing the broadcaster of demanding a 300% price increase — after Dish had offered to pay a 200% rate hike — and of requiring that it disable its Auto Hop feature or face severe penalties. “Gannett is stifling innovation and crushing customer choice and control,” Dish senior vice president of programming Dave Shull said in a statement Oct. 5, two days before its contract with Gannett was set to expire. “That’s insulting to our subscribers and we won’t stand for it.” According to sources close to the negotiations, Gannett didn’t demand the Auto Hop function be disabled, but it did want to be fairly compensated for any

finance_PG_34 34

lost revenue resulting from Dish subscribers skipping through ads. “The Hopper has economic implications,” one executive familiar with the talks said. “Certainly it is part of the business-model consideration of the deal.” Whether they got that remains to be seen. But it does bring up the question of whether Auto Hop will become a sticking point in future retrans and carriage negotiations. Dish launched Auto Hop in May as part of its Hopper whole-home digital video recorder. The feature allows customers who automatically record broadcast network shows via its PrimeTime Anytime feature to skip ads with the push of a button, provided they view the show at least one day after it originally airs. LiveTV ad-skipping is not available. Pivotal Research Group principal and media and communications analyst Jeff Wlodarczak said that the Auto Hop won’t disappear from the conversation, but it may just be part of the overall efforts to keep rates, and therefore costs for consumers, down. “Broadcasters at this point have a lot of power,” Wlodarczak said. “There appears to be a going market rate, so distributors make a lot of noise. Hopefully customers notice that this is why their bills are going up.” Content providers’ consternation over Auto Hop is nothing new — a handful of broadcasters, including NBC, CBS and Fox, sued Dish in May, claiming Auto Hop violated their copyrights. Dish actually beat that trio to court, filing suit in New York a day earlier claiming broadcasters were trying to stifle innovation. Fox filed for a preliminary injunction in California in August to force Dish to disable the Auto Hop feature until the case is decided. A ruling is expected soon. “It is a differentiating factor for Dish from a marketing perspective, so why not get out there and also make a lot of noise about it?” Wlodarczak said. )

MCNBRIEFS

DirecTV, CBS Ink Carriage Deal

NEW YORK — CBS last week said it had reached a longterm carriage deal with DirecTV for its owned-andoperated television stations and cable networks CBS Sports Network, Showtime and Smithsonian Channel. Terms of the agreement were not disclosed. It was the third such deal CBS has struck since Aug ust — it reached similar agreeThe deal with CBS keeps Hawaii ments with AT&T on Five-0 on the DirecTV beat. Aug. 31 and Cablevision Systems on Sept. 5. DirecTV had been in some high-profile carriage disputes earlier in the year, but this negotiation appeared to go without a hitch. There were no threats of blackouts or accusations of corporate greed that have come to normally characterize carriage negotiations.

ValueVision Names COO MINNEAPOLIS — ValueVision Media, parent of cable shopping channel ShopNBC, has named Carol Steinberg as chief operating officer. Steinberg has served as ValueVision’s executive vice president, Internet, marketing & human resources since June 2011 after having joined the company as senior vice president, e-commerce, marketing and business development in June 2009. In connection with the promotion of Steinberg, ValueVision’s board approved an increase to her annualized base salary to $420,000 (from $325,000 in 2010, the latest figure available) and an increase to her target bonus opportunity equal to 65% of her base. She also received a grant of 30,000 shares of restricted stock, which will vest in equal installments over a two-year period.

Hulu Plus Adds Nickelodeon Content NEW YORK — Viacom said last week that it has extended its content deal with streaming-video giant Hulu, making content from its Nickelodeon kids’ channel available on its Hulu Plus service. Viacom already makes content from its Comedy Central, BET, MTV, Spike, TV Land and VH1 networks available on the subscription online service, which has more than 2 million subscribers. On Oct. 9, selected episodes of currently airing Nickelodeon live action and animated series, including iCarly, SpongeBob SquarePants, Kung Fu Panda, and the new season of Teenage Mutant Ninja Turtles, will be available 21 days after the episodes air on television. Over the next few months, additional content from Viacom’s bilingual network, Tr3s, will Kung Fu Panda is headed to Hulu Plus. be included.

| m u l t i c h a n n e l n e w s | o c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 6:58 PM

finance

Multichannel News Index (MNI) 798.38 -6.56 -0.82%

(Weekly)

Price

Week Ago

Weekly

Month

Year

52-Week 52-Week

10/9

10/2

% Change

Ago

High Low

MSOs

Cablevision Systems

16.78

16.14

3.97%

15.65

16.37

18.25 10.76

76.08

75.50

0.77%

78.15

46.63

83.41 43.98

Comcast (H)

34.41

34.78

-1.06%

33.60

21.85

35.83 20.69

Comcast Holdings (H)

35.32

35.84

-1.45%

34.46

22.06

36.98 20.90

Liberty Global (H)

60.27

61.50

-2.00%

57.20

36.09

62.44 36.30

Rogers Communications

41.48

40.52

2.37%

41.23

33.88

42.26 33.58

Shaw Communications

20.66

20.64

0.10%

20.85

20.17

21.63 18.25

Time Warner Cable (H)

97.28

98.16

-0.90%

90.82

67.52

100.17 57.15

1,420.37

1,431.06

-0.75%

1,377.07

1,021.88

1,471.49 1,418.00

TOTAL

PROGRAMMERS

Month

Year

52-Week 52-Week

10/9

10/2

% Change

Ago

High Low

Arris Group

12.54

12.77

-1.80%

13.94

11.12

14.20 12.47

33.18

34.06

-2.58%

36.11

35.27

39.66 27.59

Cisco Systems

18.80

18.87

-0.37%

19.56

16.66

21.30 14.96

Concurrent (H)

5.00

4.65

7.53%

4.27

4.55

5.36 3.21

EchoStar

30.71

29.53

4.00%

29.80

22.93

32.18 20.10 7.38 3.40

Entropic

5.47

5.49

-0.36%

5.97

4.50

Harmonic

4.30

4.44

-3.15%

4.78

4.38

6.81 3.76

Intel (L)

21.90

22.84

-4.12%

24.19

22.29

29.27 21.85

LM Ericsson Microsoft

-0.18%

17.49

12.26

23.27 12.16

-4.69%

15.97

44.12

51.83 13.59

SeaChange

8.27

8.05

2.73%

7.98

8.88 6.29

2.44

2.41

1.24%

2.50

3.11

3.45 1.33

Technicolor

CBS

34.86

34.99

-0.37%

37.02

21.51

38.32 22.05

TiVo

1.66

1.68

-1.19%

1.70

1.32

1.98 1.13

Discovery Communications (H)

59.69

59.82

-0.22%

56.42

38.09

61.56 38.56

Disney

51.51

51.64

-0.25%

51.74

31.70

53.40 32.24

Liberty Interactive

18.75

18.72

0.16%

19.29

14.87

19.80 14.54

Liberty Media (H)

106.19

105.47

0.68%

105.79

65.22

110.15 106.15

Madison Square Garden

40.24

40.40

-0.40%

41.90

22.92

44.75 22.68

News Corp. (H)

25.00

24.91

0.36%

24.66

16.30

25.76 16.18

7.27

7.34

-0.95%

7.00

6.44

7.99 5.80

63.27

62.32

1.52%

60.09

37.92

64.38 37.02

45.30

0.57%

43.64

30.85

46.59 31.26

ValueVision Media

2.37

2.26

4.87%

1.90

2.38

3.82 1.43

Viacom (H)

56.22

54.07

3.98%

50.86

40.14

56.91 39.86

WWE

8.29

8.17

1.47%

8.85

9.31

10.80 7.44

1,092.25

1,087.37

0.45%

1,076.87

863.00

1,122.23 1,089.71

TOTAL

Top 5 percentage gainers: Concurrent

7.53%

ValueVision Media

4.87%

Dish Network

4.64%

Viacom

3.98%

SeaChange

2.73%

-4.69%

Intel

-4.12%

TiVo

-3.99%

LM Ericsson

-3.21%

AMC

-3.16%

TOTAL

10.10

10.52

-3.99%

9.74

9.55

12.37 7.75

1,063.56

1,083.98

-1.88%

1,132.38

857.66

1,235.98 1,060.30

38.58 27.41

Telcos AT&T

37.14

37.81

-1.77%

37.30

28.44

Sprint Nextel

4.95

4.90

1.02%

5.03

2.41

5.76 2.10

Verizon (H)

46.11

45.86

0.55%

43.72

36.16

48.77 35.17

645.77

651.15

-0.83%

635.66

491.99

670.77 477.42

TOTAL

SATELLITE TV DirecTV Group (L)

51.02

52.11

-2.09%

53.29

55.17 50.93

Dish Network

32.15

30.69

4.76%

32.35

26.18

35.64 23.00

1,821.27

1,740.48

4.64%

1,822.73

1,567.39

1,885.87 1,254.76

TOTAL

SOURCE: Financial Content NOTE: The Multichannel Multimedia Index measures the combined prices of stocks listed on this page, weighted by market capitalization. S&P tracks the Standard & Poor’s 500 stock index.

Viacom (NASDAQ—VIAB)

Top 5 percentage losers: Rovi

11.25 8.23 32.95 24.30

17.06

46.69 30.72

45.56

9.99 26.25

14.29

32.63

Scripps Networks Interactive (H)

9.23 30.95

17.03

40.50

Time Warner Inc.

-3.21% -1.28%

13.62

-3.16%

Outdoor Channel Holdings

9.03 29.66

Rentrak

43.29

Crown Media Holdings

8.74 29.28

Rovi

41.92

Viacom stock may be up 32% in the past 12 months, but it could be headed for a decline as ratings for its flagship MTV Networks are expected to be down for fiscal 2013. Add that to the sluggish ratings at kids’ network Nickelodeon and declining ratings for 14 of Viacom’s 16 networks in the calendar third quarter (12 by double digits), and that could spell trouble for the stock. Sanford Bernstein media analyst Todd Juenger downgraded the stock to “underperform” last week, with a $50 long-term price target. “We believe the risk/reward is no longer appealing, relative to any other largecap media name,” Juenger wrote.

% Week

Price 10/9

Price 10/2

MNI

798.38

806.19

-0.97%

809.81

658.25

S&P 500

1,441.48

1,445.75

-0.30%

1,437.92

1,155.46

Month Ago

Year Ago

DJIA

13,473.53

13,482.36 -0.07%

13,306.64

11,103.12

NASDQ

3,065.02

3,120.04

2,479.35

-1.76%

$60 $56.22 55

45 $42.57

10/10/11 11/09/11 12/09/11 01/09/12 02/09/12 03/09/12 04/09/12 05/09/12 06/08/12 07/09/12 08/09/12 09/09/12 10/09/12

SOURCE: NASDAQ web site

$42.57 Tip Sheet

Market Index Comparison

financeStock_PG_36 2

Weekly

Broadcom

AMC Networks

Week Ago

EQUIPMENT VENDORS

Charter Communications

Price

3,136.42

Moody’s Reviews Netflix Debt

ISI Raises Liberty Target

Moody’s Investor’s Service said it was placing ratings for some Netflix debt under review for possible downgrade, prompted by its shift toward a streaming-video business model. “The review will weigh the benefits of diversifying into international markets against the financial and operating risks associated with entering new markets — which … may require higher levels of investment or take longer to become profitable,” Moody’s said in a statement.

ISI Group analysts Vijay Jayant and David Joyce raised their 12-month price target on Liberty Media to $123 per share from $115, in part based on expected valuation increases at its Sirius XM and Starz holdings. The analysts estimate Liberty will have as much as $3 billion in cash on hand after the planned Starz spinoff and the sale of any high-basis Sirius shares, which could be used for stock buybacks and dividends.

| m u l t i c h a n n e l n e w s | o c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 7:01 PM

platforms

SCTE, CableLabs: ‘Joined at the Hip’

Groups Boost Collaborative Efforts By Todd Spangler

The two main industry groups aiming to steer cable’s technology agenda — the Society of Cable Telecommunications Engineers and CableLabs — haven’t always had a tight connection. But now, relations between them have never been better, SCTE president and CEO Mark Dzuban said, with SCTE increasingly acting as the “applied science” partner to CableLabs’ R&D initiatives. “We’re continuing to crisp this up [with CableLabs],” he said. “We were somewhat ships in the night when I started three years ago.” In the latest example of their teamwork, at the SCTE’s Cable-Tec Expo this week in Orlando, Fla., the two groups will jointly present a special session, “DOCSIS 3.1 Specification and Standard Development.” The discussion will include speakers from CableLabs and MSOs, as well as an overview of network preparedness

On With the Show Cable-Tec Expo bounced back last year, after suffering setbacks from the recession and its initial move to the fall: Year

Attendance

Location

2008

11,000

Philadelphia

2009

9,000

Denver

2010

8,200

New Orleans

2011

10,000

Atlanta

Source: Multichannel News research

Gizmo Download

Sling Adds Some Twists To Place-Shifting Box The Hype: EchoStar’s Sling Media launched its first new Slingbox hardware since 2008, featuring support for “full HD” and the ability to fling photos and video to TVs, tablets, PCs and smartphones over the Internet. Both the Slingbox 350 and 500 support up to full 1080p HD-quality streaming of live or recorded TV programming and The SlingBox 500 has an unusual industrial design.

platforms_PG_38 38

“We’re not waiting until the spec is fleshed out before we say, ‘What’s necessary to get this up and running?’ ” DANIEL HOWARD, SCTE

and training from SCTE on the new spec, which promises speeds of up to 10 Gigabits per second downstream. With DOCSIS 3.1, “you’re going to see SCTE and CableLabs absolutely joined at the hip,” SCTE chief technology officer Daniel Howard said. Added Howard, “It’s all about being proactive. We’re not waiting until the spec is fleshed out before we say, ‘What’s necessary to get this up and running?’” In addition, CableLabs and SCTE are teaming for an opening general session discussion between Dzuban and CableLabs president and CEO Phil McKinney, along with National Cable & Telecommunications Association chief of staff K. Dane Snowden. Dzuban also noted that CableLabs chief technology officer Ralph Brown is joining the SCTE board effective Oct. 16. SCTE recently evaluated moving its flagship Expo back to its traditional June dates. However, the association concluded that early fall is the optimal time for the conference given the timing of other industry events, Dzuban said. “In the spring, it’s tough,” he said. The 2013 Cable-Tec Expo in New Orleans is scheduled for Sept. 18-20. The following year, the trade show will be in Denver in early fall. )

Ethernet connectivity. The 500, which looks like a conventional set-top box with the edges twisted up, includes HDMI inputs and outputs, dual-band Wi-Fi and media-sharing features that will initially support photos and eventually video files. What It Means: The company hopes the new features, along with easier setup, will expand the allure of Slingboxes beyond the “sports fans and techno-geeks” who have been the product’s core constituency, Sling vice president of marketing Jay Tannenbaum said. Pricing and Availability: The Slingbox 500 ($300) and 350 ($180) were slated to go on sale in the U.S. on Oct. 14. )

Translation please

Preview: CTAM Summit, SCTE Cable-Tec Expo For someone passionate about making technology approachable to nontechnical people, this week is a grand slam of cable conventions: the CTAM Summit and the SCTE Cable-Tec Expo. Marketers and engineers, all in one place! Nirvana! And hello again, Orlando, Fla. This location means one thing right off the bat: Brush up on your Full Service Network history (see Craig Leddy’s take on page 4), because you’ll likely hear more than a few anecdotes about it. Leslie Ellis For the tech-interested at CTAM Summit, don’t miss self-professed gadget guru, author (Beyond the Obvious: Killer Questions That Spark Game-Changing Innovation) and new-ish CEO of CableLabs, Phil McKinney, who kicks off a “Products Consumers Crave” panel on Tuesday at 9 a.m. The session features chief technologists from Comcast, Cox and Charter (full disclosure: moderated by yours truly). In the topic mix: What technologists want from marketers; the operational impact of “service velocity”; maneuvering a software-heavy workplace and the parallel industrial shift to “agile” development; cable’s changing role in innovation. That’s all on the front part of the week. Then, on Wednesday, the marketers pull out, and the techies pull in. What to watch for, news-wise, at this year’s SCTE Cable Tec Expo: Lots of detail about the next chapter in cable modems, now officially named “DOCSIS 3.1.” Why: A session added to the Thursday morning schedule (11-12:30) aims to go long on the constituent components of DOCSIS 3.1. It’s all about wringing more capacity out of existing hybrid fiber-coax (HFC) networks, by tweaking things like modulation and error correction. (Yes, you can expect a full translation in a future edition.) One of the great things about Cable Tec-Expo: Session repetition. This year’s technical workshops look chewy, and many repeat throughout the three-day tech-fest. Even with the repeats, though, the 2012 lineup makes one want a clone. On my short list: “Is Your Network Capable of Handling the Next Generation of Services?”; “Slaying the Bandwidth Consumption Monster”; “Fast Times: Speed Tiers and Their Impact on Your Network”; and “Take 5: HTML5 in Cable.” Also hot-looking (as hot goes): “Advanced Encoding for an Untethered World,” “CCAP Trial: The Verdict” and “Springing New Leaks: A Look at New Sources of Interference.” If there were an award for best session title (because that’s what the industry needs! More awards! ;-), it’d have to go to “Bandwidth Hunger Games.” Best acronym overload: “EPON, EPoC, DPoE, RFoG, DOCSIS — Beyond the Alphabet Soup.” (A typo in the online agenda makes it all the better: “FRoG.”) Hope to see you there! ) Stumped by gibberish? Visit Leslie Ellis at translationplease.com or multichannel.com/blog.

| m u l t i c h a n n e l n e w s | O c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 6:52 PM

mcnBuzz CHART DATE by

The social-TV charts below rank shows by volume of activity (mentions, tags, links, likes, etc.) across all public profiles on Twitter, Facebook, GetGlue and Viggle. Sentiment is a reflection of a positive score based on positive, negative or neutral comments.

CABLE TOP 10 1 2

4,169,781 Sentiment +

1,211,791 Sentiment +

Jersey Shore 994,290 Sentiment +

Monday Night Football: Texans at Jets 896,638 Sentiment +

WWE Monday Night Raw 750,280 Sentiment +

SpongeBob SquarePants 623,036 Sentiment +

MLB Playoffs: Cardinals vs. Braves 573,470 Sentiment +

43%

Duck Dynasty 425,537 Sentiment +

61%

MLB Playoffs: Reds vs. Giants 423,324 Sentiment +

47%

WWE SmackDown

Activity Score

360,849 Sentiment +

57%

454,292 Sentiment +

52%

398,151 Sentiment +

54%

Gossip Girl The CW

The Simpsons Fox

Sunday Night Football: Chargers at Saints NBC 349,129 Sentiment +

44%

NFL Football: Falcons at Redskins Fox 316,105 Sentiment +

38%

NFL Football: Packers at Colts Fox 292,630 Sentiment +

45%

292,302 Sentiment +

60%

Family Guy Fox

Activity Score

Syfy

50%

Fox

Activity Score

TBS

590,750 Sentiment +

Glee

Activity Score

A&E

61%

NBC

Activity Score

TBS

Activity Score

56%

878,389 Sentiment +

The Voice

Activity Score

Nickelodeon

Activity Score

58%

Activity Score

USA

Activity Score

42%

2,589,552 Sentiment +

Activity Score

ESPN

Activity Score

49%

Fox

Activity Score

MTV

Activity Score

44%

The X Factor

Activity Score

TBS

Activity Score

50%

MLB Playoffs: Yankees vs. Orioles

Activity Score

BET

Activity Score

BROADCAST TOP 10

BET Hip Hop Awards

Activity Score

OCT 4 - 11

Grey’s Anatomy ABC

Activity Score

291,356 Sentiment +

45%

SOURCE: Trendrr, a company of digital firm Wiredset, provides proprietary tools for monitoring, measuring and responding to digital and social-media activities. Visit its daily social-TV charts at Trendrr.TV.

TOP CABLE gAIner

mcnBuzz_PG_40 40

TOP CABLE LOSEr

‘BET Hip Hop Awards’ The BET Hip Hop Awards generated 61% more activity than last year, after sparking 2,888,776 social interactions on Oct. 9 and more than 4.1 million total interactions throughout the week.

MTV’s ‘Jersey Shore’ The final-season premiere of Jersey Shore stirred up 617,197 social interactions on Oct. 4 and 995,290 social interactions throughout the week. It placed No. 3 on the cable chart, but was down 20% from last season’s premiere.

Gender Fifty-four percent of the awards-related social activity was generated by men, with women accounting for 46%.

Gender Women accounted for 63% of the premiere-related activity, while men generated 37%.

Top Markets New York, Atlanta, Los Angeles, Philadelphia and Chicago were the five markets tweeting most about the BET Hip Hop Awards.

Top Markets New York, Los Angeles, Chicago, Philadelphia and Boston were the five markets driving the most activity around the show.

| m u l t i c h a n n e l n e w s | O c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 7:08 PM

community VOICES

bit rate todd spangler will youtube ever come close to rivaling cable tv? Oct. 8 Google is spending more than $100 million to create original “channels” for YouTube, and [last] week [expanded] the model into Europe through deals with the BBC, FreemantleMedia, the Netherlands’ Endemol and other media companies. Meanwhile, the Internet giant’s stalled Google TV initiative is redoubling efforts to bring YouTube content to big-screen TVs, with the platform set to get enhancements for finding, managing and playing YouTube content through connected TVs and other devices. But while the YouTube strategy mimics traditional cable TV in concept … it’s on a much, much smaller scale. It could take years before any online-only content attracts anything close to a TV-size audience, if that ever happens.

Numbers

4.7%

Talkback www.multichannel.com

Some Spectrum For Small Business

(Re: “Genachowski: FCC Will Exceed 2015 Target of Freeing Up 300 MHz of Spectrum,” Oct. 6, via broadcastingThe rise in the annual price of pay TV from cable.com): “Any chance that we can 2005 to 2011, faster than the consumer make available some bandwidth that price index (2.4%) but slower than a gallon can be used for unlicensed [spectrum], of gas (7.9%) in the same time period. like 2.4GHz or any of the UNI bands in Source: Todd Juenger, senior analyst, Sanford Bernstein 5GHz? God forbid we let small companies who can’t pay billions of dollars for With Drop Shadow frequency compete against the big carriers lining the pockets of politicians.”

So far, about 20 of YouTube’s original channels now average 1 million views per week , and around 25 channels have signed up 100,000 subscribers since launch, Alex Carloss, head of entertainment at YouTube/Google, said at the Multichannel News/Broadcasting & Cable Next TV Summit last month. One million viewers per week? That’s perhaps a halfway decent showing for a single TV show on cable in primetime, and an abysmal figure for broadcast television networks. For more of this blog, visit multichannel.com/Oct15.

MCN’s Most Read Top articles on multichannel.com, Oct. 4-11

1. Translation Please: The Next Big Thing in Video Compression 2. Hispanic Summit: beIn Sport Adding Distributor ‘Soon’ 3. TBS Throws Out First Pitch on MLB’s New Wild Card Round 4. New Slingbox Sprays Full HD, Personal Media Everywhere 5. FreedomPop Targets Cable With Wireless Broadband To read these stories, visit multichannel.com/Oct15.

This week on broadcastingcable.com

Rory Conaway

Engineer Phoenix, Ariz.

Networks Will Get What They Pay For

Without Drop Shadow

Coming This Fall: Signs of Life at NBC

Led by The Voice, that turnaround the network’s executives have been patiently waiting for might finally be here.

TV Land, With Too Many Ads, Subtracts Content

In the network’s new math, the length of episodes grows to accommodate spots.

(Re: “Cost of Dog Food Rising Faster Than Pay TV: Analyst,” Oct. 10): “I agree that the OTT providers present a risk to the traditional pay TV model; however, although the networks may be shortFor Black Background sighted in their licensing of content to OTT for a fraction of what they charge pay TV providers, they’re not stupid. To the extent there is a meaningful shift of viewing away from traditional pay TV to OTT, the networks will raise their licensing For Black & White fees and revisit their content bundling requirements with OTT providers, which will result in increased prices to consumers, so it becomes a self-correcting cycle. Quality content will be paid for, or it won’t be made.” Phil

Tuned in by Leo Michael

A Telling MLB Telecast (Re: “MLB Network Airs First Postseason Telecast With Oakland-Detroit,” Oct. 7): “Selig really showed his commitment to fans with this move.” “kaiser sose”

Twitterati “Mitt Romney’s new platform - firmly anti-Big Bird and anti ‘Nick News.’ Amazing.” @ MichaelOFA , Michael Czin, Northeast regional press secretary for the Obama re-election campaign, on Oct. 8 after GOP candidate Mitt Romney declined to appear on Nickelodeon’s Kids Pick the President special due to scheduling issues; President Obama participated in the Q&A “Remembering our friend and colleague Frank Pintauro. We celebrate his life and the impact he made on SHOWTIME: http://bit.ly/TeIhhk” @ SHO-PR , Showtime Public Relations, on Oct. 9, linking to an announcement that veteran marketing executive Frank Pintauro passed away on Oct. 7 at the age of 61 following a long battle with cancer

community_PG_42 42

| m u l t i c h a n n e l n e w s | O c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 7:09 PM

viewpoint

www.multichannel.com

Performing a Pay-Per-View Comeback Event providers not offering boxing, wres- Picture This successful “concert-type” event in more than a decade, according to In Demand (which did tling or UFC shows have all but abandoned not reveal specific buy figures). the pay-per-view industry over the past deIt followed a simple formula that works cade. for practically any media event: Harvey, in In the late 1990s, music, comedy and other collaboration with In Demand, created fresh entertainment-themed events were as prevcontent viewers couldn’t get anywhere else, alent — and, for the most part, as financially and then marketed the heck out of it. lucrative for cable operators — as all but the Unlike typical PPV concert events that ocbiggest ring sports events. But the emergence cur during the last leg of a performer’s tour, of YouTube and other alternative-distribuHarvey’s material was new to most potential tion platforms offering free comedy-show clips and live concert footage has grounded R. Thomas Umstead cable, satellite and telco PPV users. Then Harvey himself got the word out to a category that not too long ago was gener- Programming Editor his audience. ating 200,000-plus buys and million-dollar In the days prior to the show’s PPV premiere, he enrevenue paydays for such concerts as New Kids on the couraged viewers to pre-buy the show on his website and Block. Yet the surprising performance of an August PPV com- Facebook page; tweeted his followers about the show; edy concert has given a pulse to the entertainment catego- and talked up the event to 7 million listeners on his synry. The Aug. 2 Steve Harvey Grand Stand-Up Finale comedy dicated morning radio show. He also aired “pre-show” show was touted as the comedian/actor/talk show host’s fi- clips, warming up at the venue, on YouTube. No one can sell a marquee event quite like the pernal comedy show performance of his 27-year career. Given the show’s unexpectedly strong PPV perfor- formers themselves, as Harvey showed. He may also have created a marketing blueprint for mance, the industry would certainly welcome an encore. Despite an 11 p.m. premiere on Thursday — a typical- other popular comedians, singers, magicians and other ly poor night for PPV purchasing activity — the show entertainers looking to succeed on PPV. Hopefully more performers will see the PPV event catturned in the most successful performance of a non-ring sports event in the last five years and ranks as the most egory as more than just a tired punchline. )

It’s Critical to Keep Learning One of the most important lessons I’ve learned the Tuck School of Business at Dartmouth ColACCESS in more than 40 years in cable is that there is allege and our SCTE-Georgia Tech Management ways something new to learn. Development Program — we’re driving the deWhether it’s dramatic advances in technolovelopment of new content designed to meet the gy, the launch of services that satiate consumchanging needs of the industry. er need, or some other product innovation that While both organizations have done much to contributes to the public welfare, cable telemake our employees smarter, the lesson of cacommunications is notable for a willingness to ble is that the job is never done. We need to find stimulate the creative processes and expand the creative new ways that can help us to develop horizons of its workforce. a wider array of educational resources, and to Mark Dzuban SCTE As we gather in Orlando, Fla., this week for the make them available to more people than ever. signature events of two vital organizations — the At SCTE, we’re exploring new opportunities Cable & Telecommunications Association for Marketing and to enhance our existing associations with operators and venthe Society of Cable Telecommunications Engineers — it’s dors and to collectively design programs that align with their essential that we ensure that we keep the need for learning short- and long-term needs. Building on the relationships and new learning programs bookmarked in our playbooks. that will be so much in evidence at SCTE Cable-Tec Expo CTAM has historically done an outstanding job at mak- this week, we’re creating forums for deeper discussions that ing new resources available to the industry. The Cable Ex- can shape a collective vision for training and education. ecutive Management program at Harvard Business School, Together with our friends at CTAM, we’ve devoted conas well as events and other local and national resources, siderable time and attention to developing new content this have accelerated the way cable brings products to market week. Whether you’re attending CTAM Insights, CTAM and drives subscriber acquisition and retention. Summit, SCTE Cable-Tec Expo or some combination of the At SCTE, our programs have evolved to fill similar needs three, we urge you to take the time to learn more about our for every level of the engineering and operations workforce. industry — and to remember there is way more to come. ) Whether it’s primers and Web-based content that address fundamental principles in cable or advanced curricula — Mark Dzuban is CEO of the Society of Cable & Telesuch as our SCTE-Tuck Executive Leadership Program with communications Engineers.

vice president/Group PUBLISHer Louis Hillelson (917) 281-4730 lhillelson@nbmedia.com EDITORIAL business

Mark Robichaux Editor In Chief (917) 281-4750 mrobichaux@nbmedia.com Kent Gibbons Executive Editor (917) 281-4722 kgibbons@nbmedia.com Michael Demenchuk Managing Editor (917) 281-4712 mdemenchuk@nbmedia.com Mike Reynolds News Editor, Multichannel.com (917) 281-4748 mreynolds@nbmedia.com R. Thomas Umstead Programming Editor Multimedia Editor, Multichannel.com Editor, Multicultural News (917) 281-4768 tumstead@nbmedia.com Mike Farrell Senior Finance Editor (917) 281-4716 mfarrell@nbmedia.com Todd Spangler Technology Editor Editor, Cable Technology Newsletter (917) 281-4756 tspangler@nbmedia.com

Jason Greenblatt, Advertising Director (917) 281-4726 jgreenblatt@nbmedia.com Cheryl Mahon, Regional Sales Manager (917) 281-4738 cmahon@nbmedia.com Erica Gottlieb, Regional Sales Manager (917) 281-4729 egottlieb@nbmedia.com Zahra Majma, Classified Account Executive (917) 331-9498 zmajma@nbmedia.com Chris Rucker, Marketing Art Director (917) 281-4752 crucker@nbmedia.com Sandy Friedman, Special Projects Director (917) 281-4718 sfriedman@nbmedia.com Rebecca Shottland, Events Coordinator (917) 281-4782 rshottland@nbmedia.com Bill Amstutz, VP/Production & Manufacturing (212) 378-0411 bamstutz@nbmedia.com Heather Tatrow, Production Manager (917) 281-4762 htatrow@nbmedia.com

John S. Eggerton Los Angeles Washington Bureau Chief Katie Rosa, Regional Sales (571) 830-6440 Manager jeggerton@nbmedia.com (323) 841-7419 krosa@nbmedia.com Nicole Cobban Senior Art Director multichannel.com (212) 378-0439 Joe Ferrick, VP/Digital Media ncobban@nbmedia.com (212) 378-0410 Alberto Gonzalez jferrick@nbmedia.com Art Director Peter Brown, Web Director (917) 281-4707 (212) 378-0510 agonzalez@nbmedia.com pbrown@nbmedia.com Leslie Ellis Technology Analyst Translation Please (303) 830-2553 leslie@ellisedits.com

Circulation

Meg Estevez, Associate Director, Consumer Marketing (212) 378-0447 mestevez@nbmedia.com Christine Burgess, Circulation Manager (212) 378-0409 cburgess@nbmedia.com Ulises Cabrera, Fulfillment Coordinator (212) 378-431 ucabrera@nbmedia.com Dominique Rennell, Marketing Coordinator (212) 378-416 NewBay Media drennell@nbmedia.com Chief Executive Officer Steve Palm Subscriber Services (888) Chief Financial Officer Paul 343-5563 Mastronardi Outside U.S. Call (515) 247-2984 VP/Content & Marketing Anthony Savona International sales VP/Corporate Director, Audience Masayuki Harihara, Yukari Media Development Denise Robbins Inc. (81) 6-4790-2222 Fax (81) 6-4793-0800 mail@yukarimedia.com Customer Service e-mail MULcustserv@cdsfulfillment.com For Back Issues Call (888) 343-5563 Reprints Wright’s Media (877) 652-5295 List Rentals Lenny Medico lenny.medico@lakegroupmedia.com

Offices

New York 28 E. 28th St., 12th Floor New York, N.Y. 10016 (917) 281-4700 Fax (917) 281-4704 Washington 8015 Hatteras Lane Springfield, Va. 22151 Phone (571) 830-6440

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Vol. 33 No.40 October 15, 2012 © 2012 by NewBay Media, LLC. All Rights Reserved. Multichannel News® is a registered trademark of NewBay Media, LLC. Multichannel News (USPS 590-190) (ISSN 0276-8593) is published weekly, except one week in June, one week in August, one week in November and one week in December 2012, by NewBay Media, LLC, 28 E. 28th Street, New York, NY 10016. Subscription prices: U.S. 47 issues, $199. Canada/Mexico 47 issues $259.99. Foreign 47 issues, $299.99. Prepayment in U.S. funds only. Please send subscription orders to Multichannel News, P.O. Box 5872, Harlan, IA 51593-1167 or call (888)3435563. Outside the U.S., call (515) 247-2984. Please allow three to four weeks for your subscription to begin or for changes to become effective. Periodicals postage paid at New York, NY, and additional mailing offices. POSTMASTER: Please send address changes to Multichannel News, P.O. Box 5872, Harlan, IA 51593-1167. Publications Mail Agreement No. 41975525. Please return undeliverable Canadian addresses to: RCS International, Box 697 STN A, Windsor Ontario N9A 6N4. Printed in U.S.A.

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viewpoint_PG_43 31

10/11/12 7:11 PM

throughthewire

CTAM Summit Preview

CTAM’s Orlando Speakers Include a Marketing ‘Wiz’ Alice Norsworthy (inset), EVP of sales and marketing at Universal Orlando, will share the marketing magic of The Wizarding World of Harry Potter at the CTAM Summit.

Star speakers at the CTAM Summit include Lions Gate’s Jon Feltheimer (above) and wellness guru Deepak Chopra (below). XXXXXXXXXXXXXX

The Cable & Telecommunications Association for Marketing is doubling up on conferences this week, in Orlando, Fla. “The biggest new thing” in store for the CTAM Summit is that it will be fully co-located with the researchfocused CTAM Insights conference, CTAM chief Char Beales told The Wire. “Marketers are interested in insights, and Insights folks are interested in understanding what marketers are looking for. So we think it’s a real nice marriage.” Beales also highlighted two notable sessions, one on Sunday (Oct. 14) with Alice Norsworthy, executive vice president of marketing and sales at Universal Orlando Resort, focused on the resort’s pricey attraction, “The Wizarding World of Harry Potter.” Beales said Norsworthy’s challenge should seem analogous to what cable programmers face when a network spends big for a

Green Gets Gold With Lifetime Emmy Engineering Award

show and then tells the marketers to go bring in viewers. The other is a Monday afternoon (2:15 p.m.) session on strategies for targeting low-income customers, possibly employing pre-paid approaches that have worked for mobile phone companies. Nomi Bergman, president of Bright House Networks and Summit cochair, said that should be an especially “actionable” session, noting the reports Sanford Bernstein analyst Craig Moffett has done, warning cable not to ignore that segment. Ed Carroll, the chief operating officer at AMC Networks, is the other co-chair, and Beales credited him with the conference theme, “thriving in the complex cable and media ecosystem,” meant to underline the value of multichannel video offerings. Carroll also recruited keynote speaker Jon Feltheimer, CEO of Lions Gate Entertainment, a studio that’s prospered by diver-

received this very presti-

technology agendas with

York-based National Academy of Televi-

gious award from the Acad-

his legendary good humor

sion Arts & Sciences, also announced last

emy,” Green wrote in an

and technical smarts.

week — include Netflix and Eastman Ko-

email to The Wire. Dick Green is getting more hardware for his trophy case. The former CableLabs president and

sifying into cable programming (Mad Men, Weeds) and is even developing a show for Netflix. “They’re doing a lot of interesting things,” Carroll said. As always, the conference tries for a balance of cable insiders and outside experts as speakers, the organizers said, and the outsiders this time include Deepak Chopra, with thoughts about “the impact of media on society and how we can make a positive impact,” Beales noted. The Walt Disney World Swan and Dolphin Resort location led to early hotel bookings, though overall the conference is expected to draw fewer than the approximately 1,670 who attended last fall’s Summit in New York, Beales said. “We feel like it will be a good crowd,” she said. Next October, the Summit returns to New York as part of Diversity Week. — Kent Gibbons

Prior to CableLabs,

dak. ATAS gave a nod to Adobe Systems’

Green, whose other hon-

Green also was instru-

Pass authentication system for TV Every-

ors include induction in

mental in defining the U.S.

where with the slightly less prestigious

the Cable Hall of Fame

TV industry’s HD stan-

“Engineering Plaque.”

Dick Green: Emmy winner.

CEO is this year’s recipient of the Acade-

and a National Cable &

my of Television Arts & Sciences’ Charles

Telecommunications As-

F. Jenkins Lifetime Achievement Award,

sociation Vanguard Award, headed Ca-

which honors “a living individual whose

bleLabs from its inception in May 1988

Other winners of the 64th Primetime

ongoing contributions have significant-

until his retirement in 2009. During his

Emmy Engineering Awards — not to

ly affected the state of television technol-

tenure, he shepherded major cable in-

be confused with the confusingly sim-

ogy and engineering.”

dustry developments including DOCSIS

ilar Technology & Engineering Emmy

— all while navigating competing MSO

Awards bestowed at CES by the New

“I am surprised and honored to have

throughTheWire_PG_44 32

dards when he worked at the Public Broadcasting

Service and CBS.

— Todd Spangler

x More Online Get the full list of ATAS and NATAS engineering/technology Emmy winners at multichannel.com/Oct15.

| m u l t i c h a n n e l n e w s | O c t o b e r 1 5 , 2 0 1 2 | multichannel.com

10/11/12 7:21 PM