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Cablevision coup might not be enough if senior Dolan can't persuade board to save troubled service
BY HARRY BERKOWITZ
STAFF WRITER. Staff writer Hilary Johnson contributed to this story.
March 7, 2005
Todd and Nellie Carpenter are so in love with Voom that they bought a generator when a hurricane knocked out power just so they could keep watching the satellite TV service.
The Fort Lauderdale couple even posted an e-mail to Voom founder and Cablevision chairman Charles Dolan on a satellite TV fan Web site: "We will be with Voom until they pry the remote out of our hands."
Today, Dolan may find out whether a reconstituted Cablevision board of directors pries the Voom remote control out of his hands or allows him to try to resuscitate the all-but-dead venture the old board, including his chief executive son, James, ordered to be shut.
Even though many customers have dropped Voom, and only 46,000 have stuck with it, associates say the passion of subscribers such as the Carpenters is helping to persuade Dolan to stick with a venture that has threatened to tear apart Cablevision Systems Corp., the nation's sixth-biggest cable TV service and Long Island's third-largest company.
Last week, Dolan, who has three sons on the board, ousted three directors who had blocked his Voom vision, and hand-picked five new ones, including major media executives and a son-in-law.
On Wall Street, speculation is rife and varied over what new developments might emerge at today's board meeting, including what James Dolan's corporate fate will be and whether the company itself, or part of it, will be sold. The uncertainty sent Cablevision's stock price sinking. Analysts are nearly universal in proclaiming Voom should die.
"Chuck Dolan sees some light at the end of the Voom tunnel that is entirely lost on all of us on Wall Street," said Craig Moffett, an analyst at Sanford C. Bernstein.
But Ed Horowitz, a satellite TV consultant to Voom, which stresses high-definition channels, said that in the past Dolan has often confounded skeptics and turned initially struggling ventures into major successes.
"We've had a year of operational hell," Horowitz said of Voom's many problems. "But people who have it and use it love it. And he has demonstrated, time and time again, that he is capable of reinventing the company. "
Analysts expect the new 15-member board to at least give Dolan more time to craft a plan to take Jericho-based Voom off Cablevision's hands, even though it has cost Cablevision an estimated $1.4 billion.
"I will be surprised if Voom is shut down this week," said UBS analyst Aryeh Bourk-off.
Two new board members - John Malone, chief of Liberty Media, and Frank Biondi Jr., former president of HBO (which Dolan founded) - are expected to play crucial roles in deciding whether a Voom plan could work and whether Cablevision should sell the cable channels it owns, including AMC and IFC, or even the whole company.
Independent board member Victor Oristano said in a letter last week that Dolan was trying to alter or undo the deal to sell Voom's sole satellite to EchoStar Communications for $200 million to help save Voom.
A source said Dolan, his son Tom, who is the Voom CEO, and Josh Sapan, who heads the company-owned cable channels, had jointly flown out of town, but did not say where they went. An EchoStar spokesman in Colorado declined to comment as did a Cablevision spokeswoman.
Dolan is furious at James for opposing him on Voom, analysts said. Some said he might try to oust James as CEO of the company, possibly leaving him to head only Madison Square Garden, which the company owns. But others said that if that happens, it won't be yet.
"The naming of the new directors smacks of a vendetta against Jimmy, of payback for having supported Jimmy at Chuck's expense," Moffett said.
Cablevision coup might not be enough if senior Dolan can't persuade board to save troubled service
BY HARRY BERKOWITZ
STAFF WRITER. Staff writer Hilary Johnson contributed to this story.
March 7, 2005
Todd and Nellie Carpenter are so in love with Voom that they bought a generator when a hurricane knocked out power just so they could keep watching the satellite TV service.
The Fort Lauderdale couple even posted an e-mail to Voom founder and Cablevision chairman Charles Dolan on a satellite TV fan Web site: "We will be with Voom until they pry the remote out of our hands."
Today, Dolan may find out whether a reconstituted Cablevision board of directors pries the Voom remote control out of his hands or allows him to try to resuscitate the all-but-dead venture the old board, including his chief executive son, James, ordered to be shut.
Even though many customers have dropped Voom, and only 46,000 have stuck with it, associates say the passion of subscribers such as the Carpenters is helping to persuade Dolan to stick with a venture that has threatened to tear apart Cablevision Systems Corp., the nation's sixth-biggest cable TV service and Long Island's third-largest company.
Last week, Dolan, who has three sons on the board, ousted three directors who had blocked his Voom vision, and hand-picked five new ones, including major media executives and a son-in-law.
On Wall Street, speculation is rife and varied over what new developments might emerge at today's board meeting, including what James Dolan's corporate fate will be and whether the company itself, or part of it, will be sold. The uncertainty sent Cablevision's stock price sinking. Analysts are nearly universal in proclaiming Voom should die.
"Chuck Dolan sees some light at the end of the Voom tunnel that is entirely lost on all of us on Wall Street," said Craig Moffett, an analyst at Sanford C. Bernstein.
But Ed Horowitz, a satellite TV consultant to Voom, which stresses high-definition channels, said that in the past Dolan has often confounded skeptics and turned initially struggling ventures into major successes.
"We've had a year of operational hell," Horowitz said of Voom's many problems. "But people who have it and use it love it. And he has demonstrated, time and time again, that he is capable of reinventing the company. "
Analysts expect the new 15-member board to at least give Dolan more time to craft a plan to take Jericho-based Voom off Cablevision's hands, even though it has cost Cablevision an estimated $1.4 billion.
"I will be surprised if Voom is shut down this week," said UBS analyst Aryeh Bourk-off.
Two new board members - John Malone, chief of Liberty Media, and Frank Biondi Jr., former president of HBO (which Dolan founded) - are expected to play crucial roles in deciding whether a Voom plan could work and whether Cablevision should sell the cable channels it owns, including AMC and IFC, or even the whole company.
Independent board member Victor Oristano said in a letter last week that Dolan was trying to alter or undo the deal to sell Voom's sole satellite to EchoStar Communications for $200 million to help save Voom.
A source said Dolan, his son Tom, who is the Voom CEO, and Josh Sapan, who heads the company-owned cable channels, had jointly flown out of town, but did not say where they went. An EchoStar spokesman in Colorado declined to comment as did a Cablevision spokeswoman.
Dolan is furious at James for opposing him on Voom, analysts said. Some said he might try to oust James as CEO of the company, possibly leaving him to head only Madison Square Garden, which the company owns. But others said that if that happens, it won't be yet.
"The naming of the new directors smacks of a vendetta against Jimmy, of payback for having supported Jimmy at Chuck's expense," Moffett said.
