Cable's new stable
Consolidation, tech inroads trim Western Show
Those were the days that cable networks, flaunting the most garish programming displays they could devise, dominated the vast exhibition halls. The networks hoped to dazzle cable operators into buying the rookie channels in their local markets or renewing the veterans for strapping increases in license fees.
Fast forward to the 2000 Western Cable Show, which will fill the L.A. Convention Center from Tuesday to Saturday.
Pay TV networks such as Showtime, Starz Encore and Playboy Channel have defected. Up until last year, they ponied up more than $500,000 to rent the glitziest of booths; now, their floor space is mostly in the sober hands of technology companies.
"Many cable operators are sending their engineering people to Los Angeles and leaving their programming and marketing people at home," said Larry Gerbrandt, senior cable analyst for Paul Kagan Associates.
Instead of the latest high-visibility series and movies from TNT, USA and Lifetime, Gerbrandt continues, "the Convention Center corridors will be buzzing with talk of streaming video, interactive services, video-on-demand, personal video recorders and high-speed access to the Internet through cable wires."
Pam Burton, the Houston-based director of worldwide bandwidth marketing for CaritaSoft, a cable-marketing company, said she's skipping the Western Show for the first time in more than a decade.
'Too many distractions'
"There's no way I'm going to take four days out of my busy schedule to fly off to California," she said. "I can maximize my time a lot better by staying in the office and negotiating deals in a calm atmosphere. A cable trade show is full of too many distractions to get deals done."
An MSO (multisystem cable operator) has to shoulder a minimum cost of $2,000 a person in travel and expenses for every employee it sends to the Western Show.
Because the license fees to cable operators of networks like ESPN, TNT and regional sports nets are zooming into the stratosphere, many MSOs are cutting corners.
The main reason Showtime, Starz Encore and Playboy have abandoned their convention booths -- which, including staffing, can cost more than $1 million -- is that mergers among MSOs have shrunk the cable-operator community drastically over the past few years.
A cable network can now reach more than 85% of U.S. subscribers by getting full clearance on just the top seven MSOs: AT&T, Time Warner, Charter, Cox, Comcast, Adelphia and Cablevision Systems.
Just last month, HBO announced it would also relinquish its booth after this year's Western Show.
Consolidation consideration
"With all of the consolidation, there's no need anymore for an MSO and a programmer to get together at the Western Show, because they're in touch all the time," said Mike Egan, a cable consultant and former principal in Renaissance Partners, the cable operator swallowed up by Paul Allen's Charter Communications.
The critics may carp all they want, but there's still plenty of enthusiasm among officials of the CCTA (California Cable TV Assn.), which organizes the Western Show every year.
C.J. Hirschfield, VP of industry affairs for the CCTA, said the prospect of a front-row seat to demonstrations of the latest high-tech gizmos is giving an adrenaline shot to attendance, which could climb above last year's record of 31,208 registrants.
The number of companies that have leased exhibition space at the L.A. Convention Center -- 388 at last count -- is not far off last year's totals, Hirschfield said.
And Gerbrandt lists two reasons why it's unlikely basic cable networks will follow the lead of their pay TV counterparts who have deserted the exhibition floor.
Fledgling networks like New Urban Entertainment, a potential competitor to BET, must do everything they can to attract attention among cable operators, even if it means putting on a front by overpaying to rent an eye-catching Western Show booth.
Meanwhile, the cable network giants like Turner Broadcasting, Walt Disney, MTV Networks and Discovery are always pushing new spinoff networks whose survival depends on clearance by cable systems.
