© SKYReport 2005
Sunday, February 27, 2005
SkyBOX: Lone Wolf Alert
by Evie Haskell evie@Mediabiz.com
WILL HE OR WON'T HE?
Today's the day we find out (or, at least, we should) and whichever way the news goes, the results are likely to be the stuff of both family soap opera and business thriller.
(And no, I don't mean the Oscars ... especially if you fell asleep as early as I did last night).
I'm talking, of course, about the fate of VOOM, the so-far ill-starred HD DBS venture started by cable TV pioneer Chuck Dolan. Mr. Dolan is also chairman of the No. 6 MSO, Cablevision, and the saga of VOOM could have a great deal to do with the future of cable to say nothing of DBS. If you will recall your news from just a few weeks ago, the Cablevision board voted with Mr. Dolan's son, James, and against the CVC founder to jettison VOOM, which has cost the company heavily over the past few years. VOOM's satellite went to EchoStar (which needs it) for $200 million in cash. That left the DBS service's estimated 26,000 subscribers and its slate of HD programming behind. In a play worthy of Tom Wolfe, Dolan and son Tom struck back, offering to buy the remaining VOOM assets (and assume its debts) with intentions of keeping the company alive via leased satellite.
Just one catch: How to pay for said assets. The obvious answer? Sell Cablevision, which is arguably one of the best performing cable companies with a rich cluster of systems in the New York metropolitan area.
Today, Feb. 28, is the put-up-or-shut-up day. Mr. Dolan, who has long been regarded as a lone-wolf in multiplatform circles, must come up with a financing plan. Or the Cablevision board will likely toss VOOM into a yard sale. (Unless, of course, the board grants an extension, not exactly an unknown circumstance in business.)
Let's suppose that Mr. Dolan succeeds in a financing plan - and that plan calls for the sale of the cable co. Such a scenario would bring potential suitors slavering to the plate, most notably Time Warner which controls the Manhattan system smack in the middle of Cablevision territory. Of course Cablevision won't come cheap, which means the No. 2 MSO would likely abandon any major participation in the bid for Adelphia systems, leaving the No. 1 MSO, Comcast (an Adelphia co-bidder) in the lurch --- or needing its own new financing for another big grab (or, perhaps, better participation from the smaller companies circling the prize). Then again, Comcast would probably also like to get its hands on Cablevision systems and programming assets, which in turn could drive a wedge in the Comcast/Time Warner "we'll decide what's best for the industry" partnership.
Or let's say that the elder Mr. Dolan does not come up with the requisite financing plan. Will Cablevision be able to sell those VOOM subscribers? (Don't forget, these are distinctly high-end households, given the cost of both VOOM and HD enabled TVs. Would DirecTV be willing to pay for them? Would DISH?) Will the VOOM (actually Cablevision's Rainbow Media's) HD channels also go on the block? If so, guess who is trying to shore up their programming assets? (Maybe someone in Philadelphia?)
Whatever happens, the spin-off effects could be explosive. And it all gets underway today.
Do you have a comment or letter for SkyBOX? Write the editors at: editor@skyreport.com. Please note, your comments may be used for our Web site.
http://www.skyreport.com
Sunday, February 27, 2005
SkyBOX: Lone Wolf Alert
by Evie Haskell evie@Mediabiz.com
WILL HE OR WON'T HE?
Today's the day we find out (or, at least, we should) and whichever way the news goes, the results are likely to be the stuff of both family soap opera and business thriller.
(And no, I don't mean the Oscars ... especially if you fell asleep as early as I did last night).
I'm talking, of course, about the fate of VOOM, the so-far ill-starred HD DBS venture started by cable TV pioneer Chuck Dolan. Mr. Dolan is also chairman of the No. 6 MSO, Cablevision, and the saga of VOOM could have a great deal to do with the future of cable to say nothing of DBS. If you will recall your news from just a few weeks ago, the Cablevision board voted with Mr. Dolan's son, James, and against the CVC founder to jettison VOOM, which has cost the company heavily over the past few years. VOOM's satellite went to EchoStar (which needs it) for $200 million in cash. That left the DBS service's estimated 26,000 subscribers and its slate of HD programming behind. In a play worthy of Tom Wolfe, Dolan and son Tom struck back, offering to buy the remaining VOOM assets (and assume its debts) with intentions of keeping the company alive via leased satellite.
Just one catch: How to pay for said assets. The obvious answer? Sell Cablevision, which is arguably one of the best performing cable companies with a rich cluster of systems in the New York metropolitan area.
Today, Feb. 28, is the put-up-or-shut-up day. Mr. Dolan, who has long been regarded as a lone-wolf in multiplatform circles, must come up with a financing plan. Or the Cablevision board will likely toss VOOM into a yard sale. (Unless, of course, the board grants an extension, not exactly an unknown circumstance in business.)
Let's suppose that Mr. Dolan succeeds in a financing plan - and that plan calls for the sale of the cable co. Such a scenario would bring potential suitors slavering to the plate, most notably Time Warner which controls the Manhattan system smack in the middle of Cablevision territory. Of course Cablevision won't come cheap, which means the No. 2 MSO would likely abandon any major participation in the bid for Adelphia systems, leaving the No. 1 MSO, Comcast (an Adelphia co-bidder) in the lurch --- or needing its own new financing for another big grab (or, perhaps, better participation from the smaller companies circling the prize). Then again, Comcast would probably also like to get its hands on Cablevision systems and programming assets, which in turn could drive a wedge in the Comcast/Time Warner "we'll decide what's best for the industry" partnership.
Or let's say that the elder Mr. Dolan does not come up with the requisite financing plan. Will Cablevision be able to sell those VOOM subscribers? (Don't forget, these are distinctly high-end households, given the cost of both VOOM and HD enabled TVs. Would DirecTV be willing to pay for them? Would DISH?) Will the VOOM (actually Cablevision's Rainbow Media's) HD channels also go on the block? If so, guess who is trying to shore up their programming assets? (Maybe someone in Philadelphia?)
Whatever happens, the spin-off effects could be explosive. And it all gets underway today.
Do you have a comment or letter for SkyBOX? Write the editors at: editor@skyreport.com. Please note, your comments may be used for our Web site.
http://www.skyreport.com
