Another new SEC filing (CVC 8-k): Closing of Rainbow DBS business has been delayed!

[danielle_s]

The market DID understand the barriers. It's the Dolans that didn't. They're treating VOOM like a hobby, not a business. The CVC board's job is to maximize value for the shareholders, not to cater to the whims of the Chairman (ask Enron board members). Cablevision is doing GREAT, outside of Rainbow DBS. Solution - divest the poor performer.

Is it your opinion that VOOM should be shut down, because all we need is dish & direct?
Voom would be doing fine if Cablevision new how to run the company! Voom.com is a very good example of how cablevision is not running the company properly.

 

[Westbender]

Hobby? I doubt that. They're just look at it as a long term venture. That doesn't work in today's marketplace very well. Divest? Sure. Pass on the assets and as much liability as possible and save yourself the shutdown costs!

 

[67Yv8t]

It still stands that enduring the added cost of a shut down nets them nothing. Selling off the remaining assets will net them something.

AS far as potential Future cost?

CVC can certainly put a stop order out today regarding the building of new satellites with a suggestion that they contact Mr. Dolan personally for a potential private guarantee and purchase of similar satellites.

If CVC can stop future costs by acting today, they can act today to fix those future cost issues.

If the future cost is unavoidable, then it is just that, unavoidable whether they shut it down or sell it.

The cost of continued subs being signed up, that is certainly a reason to ink a deal quickly.

But if their trying to get dolan to buy the cow instead of milking it for free, they should try to keep the cow reasonably healthy.

 

[graphiteRT]

The market DID understand the barriers. It's the Dolans that didn't. They're treating VOOM like a hobby, not a business. The CVC board's job is to maximize value for the shareholders, not to cater to the whims of the Chairman (ask Enron board members). Cablevision is doing GREAT, outside of Rainbow DBS. Solution - divest the poor performer.

WRONG!!!

You don't get to profitability in 18 months after your rollout. People are bitching that they are losing money at this point in time. That's the crux of the argument.

Amazon.com lost money for years and years. Plenty of people told them to fold up shop. Look where they are today.

HBO was a joke when it first started. How's that doing today?

You are one of the instant gratification types. That's not an attitude that is consistent with what it takes to weather a startup.

Cablevision has a couple of other little "projects" in the hopper, including trying to thwart a NY Jets stadium deal. There's $600M on the line right there.

 

[graphiteRT]

Come on, Voom isn't buying them one at a time from the local Circuit City. They are buying in Volume direct from the Manufacturer. No middle man.

Not to mention they are buying with the clout and buying power of Cablevision behind them. That some serious business on the table and I'm sure the STB manufacturers kiss some serious butt to get the business.

 

[erron]

I think, personally..that most of these doubters and people saying *but they lose money* should look at satellite radio. They are stilllosing money by the truckload! xm will need almost 5 million subs before it begins to make money at this point. A but less for sirius. Those companies are both thriving. Takes money to make money. If the word gets out it will rebound. These are the people who were around in 1981 saying *cable TV- TV is free I'll never pay what a bad idea.* Its all happened before. *people wont pay to rent a movie* hundreds of examples out there. So just look atbusiness history before making your super educated guesses at if a company losing money can stay in business for years.

 

[grumpy1]

Cablevision Future Hinges on Deadline
Thu Mar 3, 2005 04:13 PM ET

By Kenneth Li
NEW YORK (Reuters) - Cablevision Systems Corp.'s (CVC.N: Quote, Profile, Research) future could be decided in the next four days, depending on how its chairman plans to meet a deadline to acquire the company's money-draining Voom satellite television assets.

Chairman Charles Dolan, the controlling shareholder of Cablevision, faces a March 7 deadline set by the company on Thursday to purchase Voom assets that have not already been sold to EchoStar Communications Corp. (DISH.O: Quote, Profile, Research) .

On Thursday, Cablevision disclosed an informal regulatory probe by the U.S. Securities and Exchange Commission into trading activity in its stock during a time when Cablevision had sought to unwind Voom.

Dolan's desire to finance Voom as an ongoing venture could result in his selling part or all of his stake in Cablevision, or even the sale of the company in part or whole within the next two years, analysts said.

A series of recent boardroom showdowns, which have taken on the attributes of a made-for-cable movie, has pitted Dolan, who sees satellite as the future of media, against his son, Cablevision CEO James Dolan, who blocked further financing of the venture.

The satellite service lost more than $650 million last year, resulting in Cablevision taking a $355 million writedown in 2004, with more possibly coming in 2005, the company said in a filing last month.

Cablevision shares fell 5.3 percent on news of the SEC inquiry.

"The 'Alice in Wonderland' Dolan family boardroom struggle at Cablevision must surely rank as one of the most byzantine in memory," Sanford C. Bernstein analyst Craig Moffett said in a research note.

Charles Dolan late on Wednesday exercised his controlling interest in the company to replace directors who had voted against him on Voom's future. The new board members, most of whom are longtime associates of Charles Dolan, include media heavyweights John Malone, chairman of Liberty Media Corp. (L.N: Quote, Profile, Research) , and former Viacom Inc. (VIAb.N: Quote, Profile, Research) President Frank Biondi Jr.

The shakeup could even lead to the removal of Charles Dolan's son James Dolan as CEO, according to a source familiar with board plans.

"It's heading in that direction," the source said, adding that no decision have been made at this time. "He's (Charles) taking incremental steps here and has the ability to do that."

Cablevision spokesman Charles Schueler said, "We don't typically respond to crazy speculation and blind quotes."

One analyst arrived at a similar assessment. "With relations between Charles Dolan (chairman) and son James Dolan (CEO) now appearing irreparable, we believe one possible objective could be the ouster of James as CEO," Moffett said.

Corporate governance experts criticized Charles' 11th-hour tactics. "It's very unusual to replace a director midstream absent significant allegations (of impropriety), and in many jurisdictions only shareholders can do it," said Charles Elson, director of the Weinberg Center for Corporate Governance at the University of Delaware, but he added that it was "probably legal."

BILLION DOLLAR BABY

Meanwhile, media watchers and investors are scratching their heads over how Charles Dolan, who founded New York's Cablevision and landmark pay cable channel HBO, plans to finance his dream venture, estimated to cost about $1 billion to run over the next two years.

The source said Charles Dolan, who along with another son, Thomas Dolan, created a new company Voom HD LLC to buy the assets, was also tripped up over contractual obligations to EchoStar. He missed the original Feb. 28 deadline to reach a final agreement with Cablevision to buy the stake.

Cablevision in January agreed to sell its satellite, some government-issued licenses and ground facilities to EchoStar for $200 million in cash.

Charles Dolan doesn't appear to have any financial backers yet to support the quixotic bid, which observers say is no less perplexing as creating HBO seemed in the early 1970s, when it was questionable whether anyone would pay more to watch TV.

"We believe the funding Chuck Dolan will need to finance VOOM will result in a sale of CVC over the next 12-24 months, as a sale to Time Warner or Comcast would provide the most tax-efficient means of raising capital," said Richard Greenfield, an analyst at Fulcrum Global Partners.

Charles Dolan holds about 30.5 million Class B super voting shares and about 300,000 Class A shares worth about $950 million and would likely tap that reserve to fund a deal, according to Merrill Lynch analyst Jessica Reif Cohen.

(Additional reporting by Martha Graybow and Michele Gershberg)

 

[Bruce]

I think, personally..that most of these doubters and people saying *but they lose money* should look at satellite radio. They are stilllosing money by the truckload! xm will need almost 5 million subs before it begins to make money at this point. A but less for sirius. Those companies are both thriving.

They attracted subs, both way over a million, in what, 2 years, that looks good to investors, Voom 46,000 in 1 1/2 years, Sat.Radio you have people buying the units, so not as much cash put out to get subs, Voom puts too much cash out to get each sub.

By the way, I do not think Sat.Radio has anything in common with Voom anyways.

 

[graphiteRT]

They attracted subs, both way over a million, in what, 2 years, that looks good to investors, Voom 46,000 in 1 1/2 years, Sat.Radio you have people buying the units, so not as much cash put out to get subs, Voom puts too much cash out to get each sub.

By the way, I do not think Sat.Radio has anything in common with Voom anyways.

D* has only 500k HD subs per their latest CC a few weeks ago. Something like 25k HD Tivo customers within that group.

How much does Voom spend per sub compared to D* or E*. You have those figures handy?

 

[VMI]

It's okay to spend a bit on getting subs if we can keep them. That's always been the problem with VOOM, keeping not getting.

 

[GreatMac]

It's okay to spend a bit on getting subs if we can keep them. That's always been the problem with VOOM, keeping not getting.

Huh? I beg to differ. If you have tried Voom, you have to be mentally deficient to go to D* or E* or cable voluntarily, IMHO. It has the best programming and the best PQ. The only minus is the lack of HD DVR, and this is coming our way.

 

[erron]

They attracted subs, both way over a million, in what, 2 years, that looks good to investors, Voom 46,000 in 1 1/2 years, Sat.Radio you have people buying the units, so not as much cash put out to get subs, Voom puts too much cash out to get each sub.

By the way, I do not think Sat.Radio has anything in common with Voom anyways.

Check again...after a year and a half sirius had barely 50k subs. They had a huge explosion. An are only at like 1.3 million now...after almost 3 years.


Taken from a stock scouting report:
Sirius may have significant debt, around $450 million, and negative cash flow from operations forecasted until 2007, but the company has been able to sign lucrative deals which should give it a leg up on the competition.
Sirius Satellite Radio, which ended its 2004 orbit with more than 1.1 million subscribers, today said its fourth-quarter loss widened to $261.9 million, or 21 cents per share, from $147.8 million, or 14 cents per share, a year ago.



The are bleeding money moreso than voom. 260 million a quarter. But will survive, and will make millionaires out of stockholders. If dolan gets a good group behind him to advertise voom...it wil take off like sirius did. Which only has 1.1 million subs last reported. I only put them on the same level because both satellite radio and voom are ahead of thier time...and have many doubters like yourself. Compare numbers and they are indeed very similar in growth rate and debt. Thanks.


EDIT: sirius gives away radios lately to get subs and spends about $190 per sub. Even xm gave away 15,000 myfi radios around xmas for free. I have one, so I know it happened.

 

[danielle_s]

Huh? I beg to differ. If you have tried Voom, you have to be mentally deficient to go to D* or E* or cable voluntarily, IMHO. It has the best programming and the best PQ. The only minus is the lack of HD DVR, and this is coming our way.

how long have you been with VOOM? When voom had first started it wasn't completely like it is today. They did have a very big tech problem that pissed a lot of people off they cancelled they're service. In addition voom is loosing subs because the installers don't show up. I can't imagine how many people want to leave voom cause their tv guides didn't show up. This like this tend to make people shut or at least think about it.

 

[GreatMac]

I switched to Voom about 3 months ago, after 7 years with Dish. The Voom installer was great: much more professional than the Dish installer I had way back. Dish had been in business about a year and a half then and I had to reinstall my Dish myself because the guy was so useless and tech support was not helpful.

My understanding of Voom's strategy was that they ironed out the problems as much as possible before going forward with full-on advertising. Good strategy, IMHO.

I had to install a larger dish and the second Voom installer was slimy (but they all do Dish and DirecTV as well, so...) I called back, asked for them to send the first guy and that was that.

At least in my experience, nothing so extraordinary, except for the quality of the exclusive programming and the PQ.

I still repeat: after experiencing Voom's exclusive programming, which is far better than anything else available, and their PQ, which is also the best, one must have a mental disorder to voluntarily go back to D* or E*, or cable. :yikes

(yes, I do feel strongly about this )

 

[Lars]

Forgive me if this has been stated before, but posturing like we have seen happens on some scale "every single day" in business. As a business person (38,000 employees in the company I work for), former business owner (I only wish I was as good as Charles Dolan), and former stock market analyst, I can tell you my opinion is that nothing is as simple as most of us think based only on what we can possibly know. The deal seems to me to be a slam dunk for CV stock holders, but valid points have been made on future liabiltiy, whether CV was expected to loan some of the money to VoomHD, LLC and a million more variables. There are also at least a thousand reasons why this whole thing may stink to the high heavens (the SEC will find out), or may only be a visionary's way of saving another of his dreams (based on his track record, I wouldn't vote against him).

I for one, hope this goes great for Chuck, but something major must have happened to make the board not close the deal on Feb. 28 after signing a letter of intent. Jimmy can't be totally stupid, at least not he and the majority of the board.

As of today, the prospects of a continued Voom service are better in my opinion than they have been in several months- but stay tuned.

 

[James Long]

I guess I am very old fashion. I visit the *D and *E forums to read what their subs have to say. I never have posted there because, in IMHO it would be wrong to insult or deride their service on their site. It is there choice. I choose *V because I didn't want less PQ than I was getting with my big bad bud. *V was the only service I would consider because PQ is most important to me. *D and *E didn't cut or and still don't. But I wouldn't post that on their site. I also don't like Ruppert M. There I said. On the *V forum. Now if any *V's want to challenge me for what I said, I will take that.

Thanks for sharing. Not on topic for the thread and posted in another thread before, but at least you didn't compare your own standards with any individual other poster.

BTW: It's D*, E* and V* - not *D, *E and *V

JL

Oh, Happy Day!

 

[gutter]

JL...I never posted that thread anywhere else. I stand corrected with the *D *V *E. You keep things off topic and go in different directions. When you are challenged...you just ignore it to substitute your own facts. By the way...you are off topic as well.

 

[Tvlman]

GreatMac: "...one must have a mental disorder to voluntarily go back to D* "

That says it all for me. When I bought my Home Theater in 2002 I had TW Cable. After 9 months of promises and no delivery I moved to DirecTV. After a year of the same thing and only 6 HD channels I discovered VOOM. If you are used to a choice of 10 Premium movie channels and 11 VOOM Original Movie channels per night plus VOOM Originals & other HD channels totaling 40 HD choices nightly.......what's to consider?

 

[Lobstah]

Losing money isn't the reason that CVC is getting rid of VOOM. This argument has been made over and over here.
The reason that CVC is getting rid of VOOM is that they don't expect it to be profitable, for whatever reason, in the future. That's their decision...it's a risk assesment, plain and simple. And looking into the future, they don't believe the payoff is there.

Lob

 

[James Long]

JL...I never posted that thread anywhere else. I stand corrected with the *D *V *E. You keep things off topic and go in different directions. When you are challenged...you just ignore it to substitute your own facts. By the way...you are off topic as well.

Previously posted as:

All I know is that I do visit the DISH forum to read now and then but, as a courtesy to those members, I do not post. Satellite services is become more like a religion or party affiliation...not meant for general discussion unless you want to pick a fight.
http://satelliteguys.us/showthread.php?p=381143#post381143

It isn't courteous to allow people to wallow in their own stupidity.
Note: I am not naming the stupid.

JL

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