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Cable Operators

Giving HDTV the Rock Star Treatment

10/24/2004 8:00 PM Eastern

New York — After focusing much of their efforts this year on using sporting events to market HDTV, major cable operators are turning to rock stars to drive sales of high-definition programming packages and set-tops.

Jon Bon Jovi shared the stage here last week with cable officials and representatives from Samsung Electronics America Inc. to announce the launch of an HDTV concert series that will run exclusively on In Demand Networks’ INHD and INHD2 services, distributed by Comcast Corp., Cox Communications Inc., Time Warner Cable and Adelphia Communications Corp.

The MSOs, through the industry’s “Only Cable Can” initiative, are teaming with Samsung to push the year-long HDTV concert series. Combined, the companies will spend “tens of millions of dollars” on marketing the concerts and cable HDTV programming packages.

SCHEDULES AND INCENTIVES

Media includes national newspapers, national broadcast, cross-channel cable spots customized for each operator and Internet advertising, said Samsung senior vice president of strategic marketing Peter Weedfald.

The concert series kicks off on Nov. 21, with a live Bon Jovi show that will run on INHD2. Samsung agreed to market the concerts through the end of 2005.

Samsung and the MSOs are also offering consumers that buy a Samsung HDTV and order a digital-cable package a $200 Visa gift card.

Previous Only Cable Can campaigns organized by the Cable & Telecommunications Association for Marketing included a promotion that operators ran with Samsung that offered cable subscribers coupons that could be used to pay their cable bill if they purchased a high-definition set and programming package.

The $200 gift card will be issued after the consumer buys an HDTV. They won’t be able to use the gift card to help pay for the actual sets, Weedfald said, as the company believed allowing consumers to buy anything else they wanted with the gift card was a more effective approach.

“Did you ever have someone buy you a gift, and when you returned it you got a slip that said, 'Here’s $200 — buy anything you want in the store.’ That feeling — that emotive capital that’s found by, 'Suddenly I have $200 that I can do something with’ — nothing can touch it,” Weedfald said.

Most of the concerts will be taped; Bon Jovi’s performance is currently the only scheduled live show. In Demand president Rob Jacobson said performances featuring Mary J. Blige, Elton John and Sting are scheduled for December, while Earth, Wind & Fire and Chicago are tentatively set for January.

Jacobson said INHD hopes to run 15 different concerts over the next year, and that the company is currently in talks with performers that would appeal to younger viewers, in addition to their parents. He said the marketing push would provide a nice boost for INHD and INHD2.

“It’s going to create a lot of additional awareness for INHD, no question about it. And it’s going to let cable customers know that they have a place to go to get really great, high-quality pictures and sound that they can’t get anywhere else,” Jacobson said.

Through Only Cable Can, major MSOs have focused primarily this year on using sports to market HDTV. In March, Only Cable Can ran a promotion with Samsung, offering subscribers who bought a Samsung HDTV and digital-cable package $100 in coupons that could be used to pay their cable bills. The industry ran a similar promotion with Panasonic over the summer, touting cable as the best way to watch NBC’s coverage of the Summer Olympics from Athens, Greece.

Sources said CTAM and its cable partners are working on a similar consumer promotion with Sony that will tout the medium as the best way to watch football games in high-definition.

Samsung has also worked with cable rival DirecTV Inc. this fall on a $15 million ad campaign that pitches the DBS provider’s exclusive “NFL Sunday Ticket” out-of-market game package and the electronics firm’s HDTVs.

“In a world order where there are multiple partners, I would expect that the cable industry, [through] Only Cable Can, should be working with many different companies, just like we work with many different providers,” Weedfald said.

'CUMULATIVE EFFECT’

CTAM and operators that have participated in the previous Only Cable Can consumer promotions haven’t quantified how many new subscribers the campaigns generated, but some MSO executives said they have been effective.

“I think there’s a cumulative effect to all of this stuff, and the more often that we’re out there the more impact I believe they’ll have,” said Time Warner Cable senior vice president of marketing Brian Kelly. “When we get behind things like this we usually see a nice little spike associated with the number of HDTV set-tops that we have going into the home.”

Cox senior vice president of marketing Joe Rooney said it’s not easy to track the number of leads that have been generated by the Only Cable Can promotions.

“We’re pretty nascent at this cooperative marketing, and we’ve got some back-office work to do to maximize the broadband infrastructure in ways to be able to measure the activity a little better,” Rooney added.

September