Monday, June 14, 2010

Who Is Cablevision?

If you are in an area where Bresnan Communications provides service, Cablevision is the name of Bresnan's new owner. In a joint press release issued today, Cablevision Systems and Bresnan announced the acquisition by "a newly-formed subsidiary of a transaction valued at $1.365 billion." This represents a majority stake in the company. No word appeared to be available today on what, if anything, Comcast was going to do with its 30 percent stake in Bresnan. The Cablevision acquisition should be completed by the end of the year, or early 2011.

There is no indication from today's announcement as to the name of the "new subsidiary", or whether Bresnan's name will change as a result. Thanks to resources like Wikipedia, I thought my limited writing time would be better spent on getting to know the new owner:
  • Cablevision is the 5th largest cable provider in terms of subscribers. Most of these customers reside in the five states that generally make up the New York City metroplex.
  • The company is publicly traded (CVC), and is headed by Charles F. Dolan and members of his family. They, along with other investors, have unsuccessfully tried to take the company private since 2005. Ironically, another Cablevision press release issued today outlined a new $500 Million stock repurchase plan.
  • The company is a major player in both media and sports holdings. These include the Madison Square Garden, its sports teams (Knicks, Rangers, etc.) and cable channels, officially spun off from Cablevision in February but chaired by James Dolan. The company, which is headquartered on Long Island, also purchased the Newsday group of newspapers in 2008.
  • The company appears to be willing to engage in contentious disputes over carriage and/or retransmission consent, including a dispute with two NYC area affiliates of ABC that deprived Cablevision subscribers of portions of this year's Academy Awards telecast. The company also refuses to carry NFL Network, reportedly over the exclusive rights to NFL Sunday Ticket programming currently enjoyed by DirecTV. No word now on any changes to the continued availability of NFL Network to Bresnan subscribers.
  • Having most of your customer base consist primarily of New Yorkers naturally lends itself to no shortage of creative complaints, and Cablevision has been the target of many. This includes a website derived from that seemingly ubiquitous Internet presence, "(your nemesis here)".

I'll try to find out more about these and other aspects of the sale over the next few months. Bresnan has been a largely honorable provider of television and telecommunications services to the Grand Valley and other parts of the western slope, and I don't think there's any reason to think that will change.

I believe at first blush that the Cablevision deal is better for the local consumer for two reasons:

  1. Bresnan will now be owned in toto by at least two larger providers of these services in larger marketplaces. This will continue to allow for Bresnan to leverage economies of scale in obtaining programming, upgrading technology, and optimizing customer service. A note of caution is appropriate, however, regarding the aggressive retrans negotiation posture of the new owner.
  2. These companies (Cablevision and Comcast) are publicly traded, thus returning Bresnan to the purview of the public investment marketplace. A similar note of caution is warranted regarding continued attempts to take Cablevision private in the future.

Best wishes to Bresnan employees for a smooth and hopefully painless transition. We'll be watching.

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