Wednesday, April 06, 2005

A Billion Here, A Billion There…

At the very same time that Cox Communications is playing Eagle Scout in Arizona by claiming that legislation to reduce franchise fees and PEG channels will help save the poor tax payers some dough, the rest of the industry is popping champagne corks in San Francisco over their continuing double digit cash flows.

“With capital expenditures falling and revenue from new products pouring in, a panel of chief financial officers from four top MSOs said Sunday that continued double-digit cash flow is not only sustainable-- it's practically inevitable.” Multichannel News, 04/05/2005.

Comcast Corp. executive vice president and co-CFO John Alchin reports per subscriber revenue has increased in the last six years from $42 per month to $77 per month, a whopping 83%. I’d like a show of hands from all of you who’ve had your revenue go up 83% in the last six years. Come on, lift ‘em high, I’m counting.

According to the story, Time Warner and Mediacom executives were as giddy as school girls on a group date because “products” are flying off the shelf. And these reports don’t even really include VOIP. That’s sure to paint a much rosier picture for our beloved cable operators.

Add to this news, Cablevision has just announced a bid to buy Adelphia for $16 billion. Wasn’t it just last year that it looked like Cablevision might tank? So I guess those new products have put Cablevision back into solid financial territory? The eagle flies on Friday baby!

Thirteen states with legislation to kill municipal cable and communications systems, and why? Because these companies just won’t be able to compete and be profitable if the big bad munis get into the game; they won’t, they won’t they won’t!!!.

And they certainly can’t compete against those nasty satellite guys if they have to pay franchise fees. Of course contradictory to that argument is Mediacom’s CFO Mark Stephan saying their troubles with losing subscribers are now behind them as they have bundled products and sold packages. Stephan is describing what fellas with really big brains call the “marketplace.” Kind of like what Target has to do to keep WalMart at bay, but you notice that Target isn’t asking for government and tax-payer subsidies.

The nonsense and lies and arrogance are enough to make you want to kick your neighbor’s dog. That Multichannel News article has got to be put into the hands of every legislator in every statehouse in this country and tacked to the forehead of every legislative aide on Capitol Hill.

Susan Littlefield, Telecom Regulatory Manager out in St. Louis, was righteously outraged by the latest developments in the Arizona legislation. She wrote to a listserv:

"My prediction: if this legislation passes, the next rate increase will happen on the same bill that the franchise fee is lowered.....subs still pay the same but the cable operator keeps more."

You keep up this omniscience Susan and I will have to get you to start picking my lottery numbers.

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