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Cable Operators Expand Local Programming
Filed at 9:22 p.m. ET
PHILADELPHIA (AP) -- Gloomy weather didn't dim the smiles of the two perfectly coifed TV anchors as they bantered into their microphone headsets.
''The skies may be gray, but spirits are sunny and bright. Good morning. I'm Janelle Wolfe and thanks for tuning in,'' one said with practiced, professional poise. ''It's going to be a long parade. I hope you have a bowl of popcorn or some beverages handy, because folks, we're going to be here a while.''
Macy's Thanksgiving Parade? Not even close. It's the 2006 bicentennial parade of Pottsville, Pa. The town's population: About 15,000. Here's another surprise: The show wasn't produced by the local TV station but taped and edited by Comcast Corp. It aired on the cable company's statewide video on demand service, which is a bank of stored movies, television shows and other content that its digital TV customers can access at any time.
Comcast, based in Philadelphia, and other cable operators such as Time Warner Cable, Cablevision Systems Corp. and Cox Communications Inc., are quietly expanding their local news coverage of the communities they serve, offering an alternative satellite rivals can't match and tapping into demand for everything local.
While the quality of the shows varies from ESPN sophistication to simple footage of cheerleading, they're generally slicker and more diverse than those seen on public access channels produced by the community. Many local on-demand shows are produced by the cable companies, using their own video crews and on-air anchors.
By offering local on demand, cable operators hope to give subscribers one more reason to stay with them.
Parents who miss their kids' Tuesday afternoon baseball game can watch, pause, replay it on video on demand as early as that night. The video is stored on servers in the cable company's network. Customers make selections with their TV remotes and get nearly instant gratification.
''It's something satellite can't do,'' said Bruce Leichtman, president of Leichtman Research Group, a technology research and consulting company. ''It's all about differentiation.''
Meanwhile, phone companies are spending billions of dollars to blanket the country with their own TV service but aren't yet in a position to offer much, if any, local video on demand.
Besides staying a step ahead of telephone companies and standing out from satellite, video on demand also is being used to entice customers into upgrading to more expensive digital TV packages.
''They want to convert folks from analog to digital,'' said Todd Chanko, an analyst from Jupiter Research. The key is to offer the ''deepest, widest amount of content as possible.''
In a meeting last week with analysts, Comcast executives said customers who buy digital cable tend to stay with the company. Digital subscribers who use video on demand are even more loyal.
Most local shows -- from high school sports and small-town parades to middle-school dance contests and community politics -- are free while newer movies carry a charge or require a movie channel subscription. On-demand movies are different from pay-per-view, where programming is broadcast on a schedule and usually only one viewing is allowed.
Last year, 54 percent of digital subscribers watched an on-demand program, according to the Cable & Telecommunications Association for Marketing. That's up from 35 percent in 2004. About 35 million U.S. households subscribe to digital cable, according to Jupiter Research.
There aren't any industrywide figures yet for local video on demand, but cable companies said the shows have turned out to be quite popular.
''It's become a hot category for us,'' said Michael Doyle, president of Comcast's eastern division, covering Pennsylvania, New Jersey, Delaware, Maryland, Virginia and Washington, D.C.
Just in the first quarter, Doyle's division recorded 2 million views for local video on demand. That compares with 3.7 million views for all of 2006 and 2.6 million in 2005. (A customer who clicks on an on-demand show and doesn't finish it but watches it again later would count as two views.)
While growing fast, local on demand is still a small percentage of the half a billion total views the Eastern division recorded in 2006. Nationally, Comcast posted 1.86 billion on demand views last year, up 33 percent from 2005.
Time Warner said viewership of its Wisconsin On Demand has at times exceeded those for the on-demand shows of Comedy Central, Nickelodeon and two premium channels, The Movie Channel and Playboy.
Excluding paid channels, the region-focused Wisconsin On Demand was the second most popular video on demand channel for Time Warner in the state, beaten only by children's channel PBS Kids Sprout, in the fourth quarter of 2006.
Wisconsin On Demand started with 50 shows in 2003 and now has about 400 shows. New York-based Time Warner said about two-thirds of its 27 geographic divisions carry local video on-demand shows, including lessons on fly fishing, outdoor grilling, dance contests and high school sports.
In March, Cablevision of Bethpage, N.Y., created a video on-demand category for its local shows, covering such events as high school sports, parades, festivals and political events. Its ''Meet The Leaders'' program has featured politicians from New York Gov. Eliot Spitzer to Gary LaPelusa, city councilman for Bayonne, N.J.
It also airs ''Long Island's Most Wanted,'' to enlist the public's help in catching criminals.
Atlanta-based Cox, which is still rolling out video on demand to all its markets, said a bayou classic called ''Phat, Phat 'N All That Bayou'' is its most popular on-demand show in New Orleans. In April, Cox started offering local on-demand shows in Baton Rouge, Lafayette and surrounding Louisiana parishes. The video on-demand service became available in these areas in January.
By covering community events, cable operators are becoming a source of hyper-local news as television stations cut their news budgets. Newspapers cover much more local territory but are hampered by deteriorating finances.
''This was largely, at one time, the domain of local television,'' said Al Tompkins, who teaches broadcasting and online journalism at The Poynter Institute in St. Petersburg, Fla. ''As local television has continually moved away from that connectivity, others have found ways to do it.''
Cable's advantage over local TV stations is that it doesn't care about ratings, Tompkins said. Its strategy is to make the cable TV service more enticing to folks by adding local content.
''What you're trying to do is you're trying to provide a unique service that they can't get if they don't get cable,'' he said. ''I can't get the Pottsville parade on CNN.''
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