Cablevision thinks it's the ideal choice for cable TV service. Through the Optimum and iO brands, the company provides cable services such as basic and digital video programming, high-speed data, and voice. Mostly in the New York City (NYC) metro area, more than 3.6 million subscribers receive at least one of these services. Subsidiary Optimum Lightpath (about 5% of sales) serves commercial broadband Internet users in the area. Cablevision also owns NYC newspaper publisher Newsday and Clearview Cinemas, which operates nearly 50 tri-state area movie theaters, including the Ziegfeld Theater. Founder and chairman Charles Dolan and his family control about 72% of the company.
Revenue has been hard-fought across the industry, and it was a battle Cablevision lost turf over in 2011, though accounting for changes in continuing operations works out to a rosier 7% increase.
Only its News 12 Networks (comprising a dozen local stations) and commission revenue at Cablevision Media Sales (local and regional ad sales) made any headway in 2011, gaining about $3.4 million between them over 2010. Revenue at its cinemas and newspapers lost ground, which the company attributed to continuing pervasive economic struggles and intensifying competition, both of which have been challenges for most of its competitors in these areas, as well.
Mergers & Acquisitions
Intense competition in Cablevision's home turf from other cable, satellite, and phone service providers motivated the company to expand outside that area for the first time in years. (Cablevision began divesting all of its cable holdings outside NYC in the late 1990s.) In 2010 the company shelled out $1.4 billion for western US cable provider Bresnan Communications, a broadband telecommunications company that included basic video, digital video, high-speed data, and voice subscriptions in Colorado, Montana, Utah, and Wyoming. That business, known as Optimum West, now serves about 350,000 subscribers, of who about 85% carry video, about three-quarters use high-speed data, and nearly 45% have voice service.
That was Cablevision's second go at extending its reach, as it attempted to expand outside of NYC in 2005 when it made an unsuccessful bid for Adelphia's cable operations, which eventually got divided up mostly between industry leaders Time Warner Cable and Comcast a year later.
In an effort to boost its market value and improve shareholder returns by focusing its cable TV operations on the services, Cablevision in 2011 spun off its Rainbow Media cable network unit, which was renamed AMC Networks. Rainbow Media's holdings primarily included the American Movie Classics (AMC), WE: Womens Entertainment (WE tv), The Independent Film Channel (IFC), and the Sundance Channel networks. It also included the IFC Entertainment film business and Rainbow Network Communications, which developed and distributed network programming. Rainbow Media continues to be controlled by the Dolan family through a dual-class share structure.
That streamlining was a continuation from the year before when Cablevision spun off its Madison Square Garden business to its stockholders. The assets included in the spinoff were the Madison Square Garden and Radio City Music Hall venues, the Knicks and Rangers sports teams, and related broadcast and online media properties, such as the Fuse network.