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2008 CABLE SHOW: Smaller Ops Tout HD VOD, Pursuing Commercial Accounts

NEW ORLEANS—To compete in a digital age, several smaller cable operators said Tuesday that they are ramping up their HDTV lineups, offering HD on-demand and trying to expand their commercial business, a potentially lucrative sector. 

“They used to say it’s the bundle, baby, and now I would say it’s bandwidth, baby. It is about bandwidth,” said Steve Brookstein, executive vice president of operations for Bresnan Communications.

He was one of five small and mid-sized operators on a Cable Show panel called “Thinking Big: Smaller Market Operators and the Digital Transition.”

During the session, several panelists described how they are either reclaiming analog bandwidth, turning to switched digital video—or both—in order to ramp up their HDTV offerings to compete with the satellite providers.

In the case of Midcontinent Communications, president and CEO Pat McAdaragh said his company will be up to 44 HDTV networks by the summer or mid-fall, doing that expansion by recapturing analog space. Bresnan today has up to 36 HDTV services in about three-quarters of its footprint, Brookstein said, looking to offer 50 in the short term.

Ultimately, to stay competitive and get to 100 HDTV services, Bresnan will probably look at going all digital, according to Brookstein.

“Our immediate plans are to migrate to an all-digital platform,” he said.

James Bruder, president and CEO of Harron Communications, said his company has 35 HDTV networks currently, and is looking to reach 45 by the end of the year. And Calvin Craib, senior vice president of business development for Mediacom Communications, said the company’s goal is to get to 40 HDTV channels by the end of the year, in part by implementing switched digital video.

Several of the panelists were enthusiastic about HD video-on-demand as an offering, as well, as a differentiator from satellite.

“HD VOD is integral to our strategy,” Brookstein said, while Bruder chimed in, “It’s been a great product. It’s something DBS can’t do.”  

The panelists were also bullish on expanding their commercial business.

“This really is one of the next opportunities,” Craib said.

Bresnan just closed a deal to provide data transport for the entire state of Montana, according to Brookstein, who noted that commercial revenue is approaching 10% of the operator’s revenue. 

In Harron’s case, commercial services make up 5% of its total revenue, according to Bruder.

However, several of the operators, including Brookstein, warned that while commercial customers are potentially lucrative, they are more demanding than residential subscribers.

“Our commercial revenues are approaching in the 10%-range,” he said. 

McAdaragh recommended that operators assign staff to just service commercial accounts.

“We had to start dedicating people to the commercial side,” he said.

 For more news from NCTA's The Cable Show '08, click here.