In the Loop - Broadcasting & Cable

In the Loop

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Will Cable Gore Al?

At one end of the posh Windsor Court ballroom is Al Gore, relentlessly working the crowd of cable operators at an investment banker's annual National Cable Show soiree. He was in New Orleans to push his startup cable network, Newsworld International.

At the other end are cable execs, cackling over how they loathe Gore. Not because they're Republicans but because, as a U.S. senator, he championed price regulations that nearly crushed the industry. Now the ex-Veep needs those same operators to get his network rolling.

"It's hysterical," said a top executive at one major cable operator, watching Gore glad-hand. "This is a man despised
by most of the people he needs."

Or as the CEO of another major operator puts it: "He shoves bombs up our ass, and now he wants carriage on our systems?"

Gore and legal-services entrepreneur Joel Hyatt are buying Vivendi Universal Entertainment's Newsworld International (NWI) and plan to relaunch it as a new network for twentysomethings, replete with current events. Reports peg the channel's price tag at $70 million. NWI comes with 17 million subscribers. Most receive it via DirecTV, and the contract with the Rupert Murdoch-controlled satellite service is set to expire. Obviously, Gore needs to build his subscriber base. Which is why MSO execs are smirking. It's payback time.

Renewing his deal with DirecTV will take some slick maneuvering, too. Word in the industry is that Gore and his partners will play the "fair and balanced card" with Murdoch and crew. "Does Murdoch really want to be the one who says no to Gore TV?" asks the president of a major cable network. "Gore still has clout in Washington, and there are a lot of people who think Murdoch controls too much."

The strategy sounds familiar to cable execs who have already been approached by Gore's team. In meetings to raise equity for the channel, two industry execs say Gore TV had a recurring mantra: Supporting the channel financially now could pay. Like when they're lobbying Democratic legislators.

Rupert, are you listening?

His fellow cablers are.

Gore drove the 1992 Cable Act into law, derailed two giant mergers, chopped the valuation of cable systems by billions, and plagued operators for years. Who can forget Gore's calling then-cable kingpin John Malone head of the "cable Costra Nostra" and "a monopolist bent on dominating the television marketplace"?

Is Gore worried that cable execs have long memories?

"That's not what they're telling me," he says. "This channel will succeed on its merits. It isn't about my politics."

Or maybe it is.

Free the Campaign

It's election year. Some make promises. Sen. John McCain makes dictums. He'd like to load fall TV schedules with quotas for political coverage and free ad time for federal candidates. Broadcasters shot down his pet ideas in the past. Now he's pushing the idea again.

McCain is challenging broadcasters to increase campaign coverage and cut ad rates for presidential and congressional candidates. Last week, McCain said he'll ask network stations and other big TV groups to toe his line, but he hasn't decided when to make his pitch. FCC Chairman Michael Powell is working on a similar plan. Watch out.

Where the Boys Are

The boys are back. When the crucial male 18-34 audience disappeared from the Nielsen sample last fall, bells went off. An 8% drop in fourth-quarter TV usage gets noticed. After much finger-pointing, Nielsen issued a "white paper," suggesting that half the decline was due to methodological changes; the rest because young men had other things to do, like play videogames.

In first quarter 2004, TV usage in the demo was down only 6%. During the first five weeks of the second quarter, the decline was a mere 1%. So what gives? "It probably just self-corrected," says a network researcher.

But Nielsen spokesman Jack Loftus takes issue with that glib explanation. "That implies there was something to correct," he says. They're back, he says, because they've found television shows they like.

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