MEDIA FORUM: Will the cable industry ever meet expectations? - Cable's major players, Telewest and ntl, have consolidated their sales operations. Is this a good move for the sector, Alasdair Reid asks

Cable has an almost embarrassing record of underperformance. If the

future is all about interactivity and digital convergence, then cable,

in theory, is the technology most likely to deliver the greatest

benefits to consumers. It is a pretty sound theory. In practice,

however, cable tries the patience of even its most ardent

supporters.



And that is the case despite consolidation that has seen a myriad of

small and amateurish players consolidated into two supposedly top-notch

operators in Telewest and ntl. Cable still struggles to get the big

picture and, as many of its subscribers know only too well, its customer

service record is, at best, patchy. Product development has seemed

uninspired too. It has been slow to evolve to digital, hesitant in

creating its interactive advertising platform and lacklustre in selling

the technology to advertisers.



Last week, not for the first time, the cable industry told us that this

is about to change. It is acquiring a new focus, as embodied in a new

advertising sales structure created by a 'merger' of the existing

Telewest and ntl sales teams. Actually, the word merger is a bit of a

euphemism.



The truth is that ntl is making its sales force redundant and

contracting the business out to Telewest's sales operation, Flextech.

The new arrangements will come into force on 1 July.



Flextech has a real pedigree, built up over the years through selling

spot advertising on a portfolio of cable and satellite TV channels

including Living and Bravo. When Flextech merged with Telewest, it took

on Telewest's cable platform opportunities. Now, with this latest

development, it will sell advertising opportunities across the whole

cable industry, including advertiser locations on the digital

interactive domain plus banners on electronic programme guides and on

cable modem internet properties. Interestingly, it will also sell

interactive opportunities on BSkyB because Sky obviously carries the

individual TV channels (Bravo, Living, etc) that it sells.



Is this a significant step forward for the industry? Or are we likely to

be disappointed yet again? David Cuff, the commercial director of

Flextech Telewest, obviously argues for the former. He states: 'We are

at the beginning of a step-change in the TV market and we are ideally

placed in that we sell theme advertising (conventional spot advertising)

on our broadcast entertainment channels as well as our interactive

properties. Now we have the whole of the cable proposition under one

roof. There has been a lot of investment in cable's interactive product

but the benefits are not yet fully understood, so we have an educating

role in increasing the understanding of interactivity.'



In his previous job at Initiative Media, Cuff was one of the first on

the agency side to realise the potential of interactive and was

instrumental in pushing forward some groundbreaking deals. So, although

his evangelical enthusiasm comes easily, does he remember any

frustrations when he was on the other side of the fence and can he now

deliver? He says: 'We have a convergent sell but don't expect it all to

happen tomorrow. What we have is the best interactive kit going and the

ability to revolutionise a company's marketing. The main challenge is

communicating with businesses that want to take advantage of that.'



Is the market ready to listen? Nigel Sheldon, a managing partner of

mdigital, says that people continue to expect a lot from cable. Things

that perhaps a sales structure cannot deliver on its own. He comments:

'People expect cable to blow the walled garden idea out of the water and

allow you to move straight from TV to the internet. They are also

clamouring for standardisation. This move will provide a single point of

contact and a co-ordinated approach to cable, although it's true that

the two platforms are not exactly the same. But it will undoubtedly give

a cohesion that wasn't there before and that has to be good.'



Some advertisers, especially the more sophisticated and media-literate

ones, find occasional talk about the need to 'educate clients' a little

irritating. The technologies and systems involved are not complex, they

point out, and advertisers are quite at home with the issues surrounding

one-to-one marketing. They have been grappling with them for decades,

after all.



In the past, cable has managed to alienate advertisers in other ways

too. As one source puts it: 'I don't think cable companies realise how

annoyed advertisers have been at the fact that cable has been so

obstructive with regards to Barb and the collection of multichannel

ratings data.



Cable has always been open to the criticism that it hasn't marketed

itself to consumers but its attitude in the past to the advertising

industry as a whole would also surprise a lot of people. It just hasn't

seen advertising as important to its future and as a result it has lost

business. Cable has inhibited its own growth in this country.'



The new sales structure will have to be adept at bridge-building. Cable

industry sources would point out it is not doing too badly when it comes

to interactive advertising. Telewest claims to have 150 interactive

advertising partners; ntl has about 100. However, they may be misguided

if they believe that the future belongs to them by default. Take, for

instance, Procter & Gamble, a pioneer in digital and interactive

advertising on both sides of the Atlantic.



P&G has trialled digital interactive cable but isn't on either of the UK

cable platforms. Its head of media, Bernard Balderston, comments: 'The

broader issue here is one of how relevant and cost-effective interactive

television can be but on this specific development, our point of view

would be that we can't see any negatives. From an advertiser point of

view, the promotion of a cross-cable sale could be advantageous. We

can't see there being a competition issue. There are only two or three

providers in the interactive market and BSkyB won't be selling cable and

cable won't be selling BSkyB. A joint sales operation could help to

provide a more coherent platform and might also help to promote

consistency from a technical point of view.'



Barrie Cree, a director of Zenith Interactive Solutions, agrees with

that. He argues that, at the very least, the merger will remove one

potential source of confusion. He explains: 'I'd say there was still

confusion in advertisers' minds. When the cable companies come in, they

tend to say slightly different things and there is a tendency for them

to take a pop at each other. I know the industry is often worried about

consolidation on the sales side because they fear it lessens competition

and effectively pushes prices up. I don't agree. Our view is that it is

often more productive dealing with a smaller number of larger

suppliers.'



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Digital marketing executives oversee the online marketing strategy for their organisation. They plan and execute digital (including email) marketing campaigns and design, maintain and supply content for the organisation's website(s).