Time Warner Renaming Local News Channels “Time Warner Cable News”

Phillip Dampier March 19, 2013 Competition, Consumer News Comments Off on Time Warner Renaming Local News Channels “Time Warner Cable News”

ynnIn a rebranding effort some Time Warner Cable employees and viewers are fuming about, all 17 of the cable company’s local news operations including YNN (Upstate NY), NY1 (NYC), and News 14 (the Carolinas) will be renamed “Time Warner Cable News” by the end of this year.

The new look will include a studio makeover, new theme music, and a more uniform presentation across all the news broadcasts.

The experiment in creating the cable company’s local news channel began in Rochester, N.Y. in 1990, even before Time Warner Cable as a brand existed. WGRC-TV was launched by Greater Rochester Cablevision that year with a handful of daily newscasts interspersed with off-network syndicated programming. In 1992, WGRC-TV left channel 5 for channel 9 and was rebranded “GRC9News.” When the newly named Time Warner Cable arrived in town, the channel was rebranded yet again as “R News.”

In August 2009, Time Warner changed the name to YNN (Your News Now) Rochester, just one of several YNN channels operating upstate in Buffalo, Rochester, Syracuse, and Albany.

For YNN viewers, it is just one more name change for a news channel that has increasingly shed its veneer of independence from the cable company that lives under the same roof.

Ny1header-img

NY1 fans are far less sanguine about the change.

“It’s a boneheaded move that will punish a unique, standalone brand like NY1 — by reminding viewers just how corporate TV news has become,” wrote Don Kaplan, the New York Daily News television editor.

“This might be the stupidest media rebranding scheme I’ve ever heard of,” Seth Fletcher, a science writer who lives in Brooklyn, wrote in a Twitter post.

“Time Warner — rebranding NY1 into TWC News might be your dumbest move since merging with AOL,” wrote the band They Might Be Giants.

Time Warner said the change is intended to give the news operation a higher profile and more closely identify it as a cable-only service not available on their biggest competitors, Verizon FiOS and AT&T U-verse.

timewarner twcBut critics of the change note most of Time Warner’s local news channels have relentlessly pounded home the channel is only available on Time Warner Cable — never on FiOS, satellite, or U-verse — for years.

At least one observer privately noted the rebranding could be another attempt to cut costs by allowing the news channels to share anchors, reporters, and news content without viewers catching on it isn’t always produced locally. YNN’s network of news channels in upstate New York have already proved this, with certain content produced in Buffalo for viewers in Rochester, Syracuse, and Albany.

Time Warner Cable is also in the process of rebranding its various local and regional sports channels under their new name: Time Warner Cable Sports.

He’s Back: Dr. John Malone’s Liberty Media Buying 27.3% of Charter Cable

Phillip Dampier March 19, 2013 Charter Spectrum, Competition, Consumer News, Rural Broadband Comments Off on He’s Back: Dr. John Malone’s Liberty Media Buying 27.3% of Charter Cable

charter-communicationsDr. John Malone’s Liberty Media will buy a 27.3 percent interest in Charter Communications with a $2.62 billion investment in America’s fourth largest cable operator.

Liberty will buy the stake from investment firms Apollo Management, Crestview Partners, and Oaktree Capital Management.

“We are pleased with Charter’s market position and growth opportunities and believe that the company’s investments in its high-capacity digital network which provides digital HD and on demand television, high-speed data and voice, will benefit its customers and shareholders alike,” Malone said in a statement.

Malone is no stranger to the cable industry, having been at the helm of Tele-Communications, Inc. (TCI), the largest cable operator in the country in the 1980s and 1990s. TCI systems were sold to AT&T in 1999, which eventually spun them off to Comcast and Charter Communications, which still run them today.

Dr. John Malone

Dr. John Malone

Since Malone’s exit at TCI, he has been in charge of Liberty Global, which owns cable systems overseas and controls several U.S. cable programming interests through his Liberty Media operation. The investment in Charter represents Malone’s return to an American cable industry he helped pioneer.

The agreement requires Liberty to acquire no more than 35 percent of Charter until January 2016, at which point Liberty’s maximum allowable controlling interest rises to 39.99 percent. Liberty also wins four seats on Charter’s board of directors. But many industry analysts predict Malone will not be satisfied with anything less than eventual full control.

Malone often takes an initial minority interest in the companies he later intends to acquire outright. Macquarie analyst Amy Yong told Reuters he employed a similar tactic to gain control of SiriusXM, the satellite radio company.

“He’s probably going to have a pretty big say in the company’s future over the next few years. This will accelerate capital returns and take advantage of Charter’s tax assets to consolidate the cable industry some more,” Yong said.

Malone is attracted to investment opportunities in companies with high marketplace leverage opportunities and exploiting potential revenue from captive customers in the rural, less-competitive markets Charter has traditionally favored.

Here today, gone tomorrow.

Here today, gone tomorrow: Bresnan Communications that was Optimum is now Charter Cable.

Malone also has a strong philosophy towards marketplace consolidation, something ongoing in the cable industry, particularly among smaller cable operators serving less-populated areas.

Under the leadership of ex-Cablevision executive Thomas Rutledge, Charter Communications recently acquired the interests of Cablevision West — former Bresnan Cable systems in the mountain west. Malone sees considerable opportunities expanding operations in smaller communities that have either received substandard cable service, or none at all.

Malone has recently been stockpiling available cash for investments, spinning off his former cable programming properties Starz, a premium cable channel, Discovery Communications, which runs the Discovery Networks, and Liberty Interactive, which owns the lucrative home shopping channel QVC.

Charter Communications has had a difficult history. Microsoft co-founder Paul Allen bought a controlling interest in the cable operator in the late 1990s, primarily because he saw cable broadband as a natural fit for his vision of a future wired America. Allen’s weighty investment was used to jump into a cable industry consolidation frenzy still underway more than a decade ago. Cable operators claimed consolidation was necessary to increase efficiency by building up regional clusters of cable systems. Before consolidation, it was not unusual for two or three different cable operators to serve customers in separate parts of a metropolitan area. Often one operator would serve the city with one or two other cable companies offering service in suburban and exurban communities nearby.

In 1999 alone, under Allen’s leadership, Charter Cable acquired 10 cable companies.

bankruptBy 2005, Charter Cable had amassed millions of new subscribers, but not as many as company executives claimed when they artificially inflated subscriber numbers to protect the value of the company’s stock. Four executives were indicted that year for criminal accounting fraud. By 2009, with $22 billion in debt, the company declared bankruptcy, eventually wiping out shareholders.

The court’s decision to forgive 40 percent of the company’s debt angered creditors but opened an opportunity for private equity firm Apollo Capital Management to gain control by ending up with the majority of shares in the restructured company.

For years, the company has continued to receive some of the worst customer satisfaction ratings in the industry, usually ranking at or near the bottom. But many Charter customers stay because there is little competition from other players, especially telephone companies. AT&T’s U-verse is the most likely triple-play competitor, but AT&T has avoided introducing U-verse in many of Charter’s service areas because they are deemed too small.

Malone sees Charter’s future revenue potential grow as a broadband provider, considered both a money-maker and must-have service. Analysts say that Charter is well-positioned to poach more customers from phone companies, which typically only offer slow DSL service in much of Charter’s rural footprint.

Gore: Malone is the Darth Vader of cable.

Gore: Malone is the Darth Vader of cable.

But customers may find with Malone’s involvement, that service may come at a price. Malone was criticized heavily in the 1980s and 1990s for leading the charge for customer rate increases. TCI’s captive customers in Tennessee found their cable bills increased between 71-116 percent in just three years during the 1980s.

Former Sen. Al Gore, Jr., at the time called Malone the head of a “Cable Cosa Nostra” and the Darth Vader of big cable. The cable executive was a frequent target of lawmakers flooded with constituent complaints about poor cable service and accelerating prices.

In 1999, The Guardian noted Malone was an admirer of telecom oligopolies:

He is scathing about regulatory attempts to prevent monopolies and mergers. Governments, he says, are “antediluvian” in their approach to the emerging new world economic order. Instead of trying to prevent mergers and collusion between media and communications companies, Malone says governments should actually promote the creation of “super-corporations” (such as his own) with enough capital to exploit the potential of new technology.

That attitude may soon be back in play with the cable industry’s increasing focus on expanding broadband service as their new primary revenue generator.

Bright House Boosts Speeds, Prices, Cable Modem Fees

Phillip Dampier March 18, 2013 Broadband Speed, Consumer News Comments Off on Bright House Boosts Speeds, Prices, Cable Modem Fees

Bright House Networks first boosted Internet speeds in January and is now back with a price boost.

brighthouseinThe cable provider’s Turbo High Speed Internet increased earlier this year from 20 to 30Mbps for downloads. Its Lightning tier went up even more — from 40 to 60Mbps. Even Business Class customers saw speed increases to 70Mbps. But now prices are up as well — as much as $5 a month more for “upgraded broadband services,” a higher cable modem rental fee, and $3 more for television packages:

  • Standard Cable TV service is up $3, from $65 to $68 a month
  • Late fees are increasing by an extra $0.50;
  • The cable modem rental fee that used to be $2 a month has increased an additional $1.50 — now $3.50 per month.

Price increases will not affect customers on promotional offers or certain bundled service packages combining multiple services.

The fee that bugs many customers the most is the company’s modem rental fee, which applies regardless of the age of your equipment.

“I told the customer service rep that I’ve had this modem for a couple of years and it’s not like altered or improved,” Pete Dooley of Satellite Beach, Fla. told Florida Today. “She said ‘You know the economy is today. They just needed more money.’ I guess you’re just supposed to casually accept it.”

The rest of the rate increases were attributed to the cost of cable television programming.

Jeff Kagan, a cable industry analyst told the online news service cable television rates have roughly doubled over the last decade.

Updated: AT&T’s New U-verse Customer Promos: Free Tablet or Game Console for Those Who Wait

Phillip Dampier March 18, 2013 AT&T, Consumer News 4 Comments

u-verseAT&T is giving new U-verse customers their choice of a Kindle Fire HD, Nexus 7 Tablet, SONOS PLAY:3 or Xbox 360 game console when signing up for a double-play package of Internet and either phone or television service.

The company is targeting customers planning to switch more than one service away from an existing provider. Most will likely choose U-verse broadband and television service, but any combination of telephone or TV service will qualify a customer for the gift promotion, valued at up to $350.

But customers could wait more than a year before the gift shows up.

The fine print states that customers must wait up to 34 weeks (more than half a year) after signing up before a “reward notification” arrives. At that point, customers must complete an online redemption submission and wait an extra 23 weeks for the tablet or game console to arrive, assuming the customer kept service for at least 30 days.

Customers must sign up before  July 27, 2013 to qualify.

[Updated 3/19: One of our readers in the comment section quotes from an AT&T representative that their press release contained two major “typos”: It should have said 3-4 weeks and 2-3 weeks, but someone forgot to proofread.]

Bank of America Analyst Suggests AT&T and Verizon Wireless Buyout Vodafone

Phillip Dampier March 18, 2013 AT&T, Competition, Consumer News, Verizon, Vodafone (UK), Wireless Broadband Comments Off on Bank of America Analyst Suggests AT&T and Verizon Wireless Buyout Vodafone

att verizonVerizon Wireless and AT&T could cooperate to allow both companies to build market power in the United States and abroad with a buyout of Vodafone, now a part-owner of Verizon Wireless.

The world’s second largest wireless service provider (behind China Mobile), Vodafone could be subject to an American takeover if the two largest phone companies in the United States structure the deal together.

Bank of America-Merrill analyst David Barden suggested AT&T could buy Vodafone’s international assets at an estimate price of $70 billion, allowing Verizon to buyout Vodafone’s 45 percent stake in Verizon Wireless.

Barden warned the deal would be time-consuming, and likely attract strict scrutiny from regulators both at home and abroad, but a deal would give Verizon its desired full control of its domestic wireless operation and allow AT&T to become a major global player in the wireless marketplace in Europe, Asia, Oceania, and the Middle East.

An analyst from RBC made news last week suggesting AT&T could be amenable to selling its non-core assets to raise cash, including the sale of its wireless broadcast and cell towers — money that could be used to help pay for such a deal.

AT&T spokesman Brad Burns declined to comment specifically on the speculation by RBC, but admitted, “if we wanted additional flexibility, that could be an option for us.”

“In all cases, our decisions are driven by what’s right for the company and for our shareowners, so in that sense, nothing’s off the table,” Burns said. “But any comments by analysts about potential sales are simply speculation.”

AT&T achieved record cash flows in 2012 and will likely end 2013 with $14 billion in free cash, which could be used in an acquisition strategy or returned to shareholders.

Fran Shammo, chief financial officer of Verizon, noted the company has been interested in taking full control over its wireless division for some time.

The estimated cost of buying out Vodafone’s U.S. share is around $115 billion.

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