To Halt Its Sub Erosion, Charter Turns to Bellville

Former Cox Communications Inc. operations chief Margaret Bellville has been named to head Charter Communications Inc.'s troubled systems operations.

Bellville, a rising star in the cable industry before she resigned as executive vice president of operations for Cox in January 2001, has agreed to take on the daunting task of rebuilding Charter's eroding subscriber base.

Bellville signed on as Charter's executive vice president of operations on Dec. 4. She effectively takes over for Dave Barford, Charter's chief operating officer, who was placed on paid leave in October.

Barford was placed on paid leave in connection with a federal grand jury investigation into some of the St. Louis-based MSO's accounting practices, including its method of counting some subscribers.

Although Charter said the appointment does not reflect on Barford's status with the company, Bellville will essentially assume his duties. In her new post, Bellville will be responsible for all of Charter's field operations, including marketing, programming and customer care.

Also last week, several programming sources confirmed reports that FBI agents have made calls over the past two weeks regarding rebates demanded by Charter.

According to several sources, the FBI was mainly concerned with a letter sent to programmers in the spring by Charter vice president of programming Patty McCaskill. The letter supposedly demanded rebates — some of which totaled hundreds of thousands of dollars — stemming from the MSO's miscounting and then paying for non-paid disconnects in 2001. Charter evidently received credits from the networks, which are now seeking redress.

Sources said FBI agents appeared to be interested in possible disparities between the subscriber numbers Charter was reporting to programmers and the public.

Charter declined comment, as did the FBI.

Bellville, who had been heading streaming media start-up Incanta Inc. before it ran out of money this spring, joins Charter at a shaky time.

The FBI revelation only adds to the mounting troubles at the St. Louis-based MSO, whose share price has declined by about 90 percent since January as it struggles under a heavy debt load and mounting subscriber losses.

Aside from the grand jury investigation, Charter has been bleeding subscribers – it has lost about 270,000 customers this year – and is working to create a low-cost digital package to combat direct-broadcast satellite competition.

Familiar territory

However, this is not foreign territory to Bellville. Back in 2001, while she was on leave attending Harvard Business School, Cox lost a slew of subscribers in Phoenix — its largest market — to an aggressive digital offering from Qwest Communications Inc.

Although some observers blamed Bellville's resignation from Cox on the problems in Phoenix, which she vehemently denied, Cox had righted the situation before she left. And some industry observers said the changes she brought to Cox would fit well with Charter.

"Many of the things that Cox is doing well today — streamlined reporting, quick decision-making — are things that Maggie brought to Cox," the industry source said. "I expect she'll bring these same strengths to Charter."

Former Adelphia Communications Corp. senior vice president of operations Ann Montgomery, now an industry consultant, said that Bellville likely will focus on strengthening Charter's customer service as a way to grow the subscriber base.

"Maggie is very capable on efficiencies and expense management," Montgomery said. "I think her strongest suit, and one of her fortés, is customer orientation. I'm sure that improving their customer satisfaction will also assist in improving their retention."

"[Charter CEO] Carl [Vogel] is a very decentralized type of leader," Montgomery added. "He believes in pushing out a lot of authority out into the field. I'm sure Maggie will be making that vision into reality. I think she and Carl will be wonderful partners for each other at Charter."

Vogel appeared to agree.

"We're very fortunate to have recruited this proven leader in telecommunications back to the operating side of the cable television business," Vogel said in a statement. "With more than 20 years of broad-based experience in operations, business development, marketing and sales, Maggie will actively participate with me and others on our senior management team in taking Charter to the next level of success by driving revenue and cash flow, maximizing efficiencies, improving customer care, and targeting our messages to customers and non-customers alike."

Industry praise

While she was at Cox, Bellville was one of the highest-ranking female executives in cable, and was named Women in Cable & Telecommunications's "Woman of the Year" for 2001. A 10-year cable veteran — she started at Century Communications Corp. in 1993 — Bellville is considered one of the more talented operations executives in the industry.

"Maggie is one of the gold standards in the cable industry," said Fox Cable Networks Group executive vice president of affiliate sales and marketing Lindsay Gardner. "Whenever she's at a trade show or on a national panel, people treat her almost like a rock star. She has that charisma about her."

Rock-star status notwithstanding, Gardner, who has known Bellville for more than a decade, added that she is a strong operational executive. And that is something Charter needs, he said.

"Charter is a place today that is beleaguered," Gardner said. "Maggie is aggressive; she's feisty."

Insight Communications Co. president and chief operating officer Kim Kelly — the top female MSO executive — said Bellville's hiring signals that Charter is serious about righting its foundering operations.

"She's a very talented executive," Kelly said. "Charter is doing the right thing getting people to focus on the ground. Charter's got some wonderful assets and obviously Carl [Vogel] is putting together some people to get the value out of those assets."

Last week, Charter said Bill Shreffler, senior vice president of its Midwest division, had resigned for personal reasons. A Charter spokesman said Shreffler's departure was not connected to the grand jury investigation. Vice president of Midwest operations David Gilles will take over Shreffler's responsibilities in the interim.

Vogel is considered by many in the industry to be a relatively low-key executive, which could clash with Bellville's often aggressive management style. But according to some industry executives, that may be a plus for Charter.

Gardner said that every Charter executive he has spoken to is enthusiastic about Bellville coming on board.

"This is Carl's hire," Gardner said. "Everyone around him and everyone he works for are backing this."

Linda Moss contributed to this story