Unless Tele-Communications Inc. executives pull off another
series of last-minute negotiations, it's unlikely that blockbuster deals will be
forthcoming from the MSO's analysts meeting this week in Denver.
Company officials last week said TCI expects to announce
year-end results, a personnel matter and, possibly, news about "the future potential
for advanced services on the digital set-top platform," said LaRae Marsik, a TCI
Leo J. Hindery Jr., president and chief operating officer
of TCI, hinted at the latter announcement two weeks ago during a financial conference in
Vail, Colo., saying that an alliance, "all based around the box," is likely.
John Malone, chairman and CEO of TCI, will anchor the
three-day conference, scheduled to run Tuesday through Thursday (March 24 to 26) at the
Denver Convention Center.
Hindery is also scheduled for a heavy presentation load
next week, ranging from network upgrades to the outlook for 1998.
Financial analysts said last week that they're not
expecting any word about TCI's work to arrange a merger between high-speed-data
provider @Home Network, which TCI controls, and Time Warner Cable's Road Runner
service as a first step toward a deal with AT&T Corp.
TCI has been working on a series of alliances for several
months that would link AT&T to a blended, nationwide platform for IP
(Internet-protocol) telephony and data services.
To achieve a nationwide footprint for AT&T, @Home and
Road Runner -- the latter of which is separately merging with the MediaOne Express
high-speed-data group -- have been in merger discussions.
A month ago, sources close to the talks told Multichannel
News that negotiations between @Home and Road Runner "went cold."
Meanwhile, Road Runner and MediaOne Express are hoping to
announce the new name and interim management team of their merged company this week, as
well as where in Silicon Valley it will be located, according to executive sources.
An alliance between Road Runner/MediaOne and a large
technology partner -- possibly Sun Microsystems Inc. or Oracle Corp. -- is also likely.
One highly placed MSO source said the merger terms were being tweaked to accommodate the
addition of a big technology partner.
AT&T's talks with TCI continue to be difficult. At
a telecommunications conference hosted by Merrill Lynch last week, AT&T chairman
Michael Armstrong said he "couldn't afford" to upgrade cable's
networks for them, according to one Wall Street analyst who attended the meeting.
And a published report late last week said TCI is also
considering the formation of a separate company, owned by cable operators, focused on IP
Marsik said TCI has said previously that it didn't
want to enter the IP-phone market without a partner, but "we haven't really
formalized the matter."
In the few days before their trek from New York to Denver,
the Wall Street community remained jazzed about TCI's performance. They said that
mostly, it doesn't matter that big deals are not in the mix for this week's
Goldman Sachs & Co.'s Barry Kaplan said he has
been "trying to caution people not to expect too much in the form of grandiose
announcements. I think that it'll be a good meeting, an upbeat meeting." He said
the key number for him will be quarterly cash flow from the cable operations, which he has
estimated at $735 million.
Bear Stearns analyst Ray Katz said synchronizing big news
to blend with TCI's message to lenders and analysts isn't all that important
Another Wall Street analyst said he wants to hear about how
TCI will finance its aggressive digital platform.
"In the past, like at the Western Show, John Malone
talked about three separate constituencies to help fund these things," the analyst
said. "I want to hear some clarification about that."
Kent Gibbons contributed to this report.
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