Cidera quietly became latest satellite company to admit plans of big profits in Internet business were being tempered with “coolness” of capital markets and need to grow at slower pace. Those factors coupled with rapid development of fiber networks expanding into remote areas and lagging demand for satellite Internet services have hurt company, industry sources said. Seeking to streamline operations and get clear focus on future, Cidera rewrote business plan despite raising $75 million from private investors last month and brought back former CEO Douglas Humphrey to replace Richard Hanna, who became “victim of the dot- com plague,” a source said. Cidera cut staff 1/3 with layoff of 100 workers, including 5 members of senior management. While company has been close-mouthed about plans, it has indicated it will use its satellite network to concentrate more on niche business customers rather than broader Internet.
LAS VEGAS -- It’s “increasingly likely” that NAACP will start boycott soon against one of Big 4 TV networks (unnamed) and its advertisers because of what Assn. Pres. Kweisi Mfume called networks’ “snail’s pace” in their diversity efforts after they all signed agreements last year to increase those efforts (CD Jan 10/00 p1). At appearance before NATPE convention here Mon. afternoon, he also called for return of financial syndication (finsyn) rule that prohibited networks from having financial interests in syndicating programming, and for legislation requiring networks to air 3 hours weekly of programs written, starring and produced by minorities. As justification for latter, he cited FCC’s 3-hour kid TV rule.
January 25, 2001 by Sasha Samberg-Champion|Miscellaneous
“We need to move the process of Sec. 271 into high gear,” new House Commerce Committee Chmn. Tauzin (R-La.) told us in Wed. interview on his priorities for House session that begins Jan. 30. On none of his core issues was Tauzin ready to propose specific legislation. He said panel would explore several options for getting Bell companies into long distance, depending on FCC cooperation. Tauzin also said he still was unsure how much legislation would be required to reform FCC and how much new agency Chmn. Powell could accomplish on his own. He said he would ask Committee “literally to do a top-down review of the digital [TV] transition,” which he said was “really off track now.”
OpenTV signed deal with Bell ExpressVu to offer interactive TV services to Canadian DBS subscribers, starting in summer. OpenTV said services would include interactive weather and TV commerce. Bell ExpressVu will add 725,000 subscribers to OpenTV’s potential reach of more than 30 million TV viewers worldwide.
Faced with loss of $1.02 billion in first fiscal quarter ending Dec. 31, Lucent Technologies announced restructuring plan Wed. that called for reducing its cost structure by more than $2 billion, taking up to $1.6 billion in restructuring charges, cutting 10,000 employees through layoffs and attrition. “Our problems are fixable,” Lucent CEO Henry Schacht said. He called fiscal 2001 “a transition year, when we are rebuilding for the future.” Company also plans to eliminate some product lines and outsource more work to contract manufacturers. Lucent had profit of $1.08 billion in same quarter year ago.
Qwest Communications reported strong results Wed. including 10% rise in revenue to $5 billion for 4th quarter that ended Dec. 31, with Internet and data services revenue growing almost 40%. Net income excluding one-time charges increased 44% to $270 million (16 cents per share), 2 cents higher than Wall St. expected. Qwest CEO Joseph Nacchio said he also was happy with “trend lines” that indicated company would meet future goals. “We spent capital in the right places” such as improved local exchange phone service in old U S West territory, he said. U S West is “no longer the worst operating telephone company in the country,” Nacchio said. “We put improved customer service on top of our priorities, we put capital there and we're seeing results.” Qwest’s results reflected some savings through synergies from merger with U S West but “most synergies will be ahead” in 2001, he said. In earnings conference call, Nacchio touched on company’s Sec. 271 strategy. He said he was heartened by FCC’s recent approval of SBC’s “multiple-state” application for Sec. 271 authority in Okla. and Kan. because Qwest also plans to file multiple applications once it gets started. With joint testing under way in 13 of its 14 states “you can expect multiple applications.” Nacchio said Qwest “probably will be the last to get the first state but the first to get the last state” approved by FCC. He said his first state probably would be Colo.
Ex-FCC Chief of Staff Kathryn Brown will be honored at reception today (Jan. 25), 4-7 p.m., at Club at Franklin Square, 1300 I St. NW., sponsored by group of FCC staffers -- Joy Howell, 202-418-0505.
Andrew Corp. said Wed. net sales increased 20% to record $280.5 million in fiscal first quarter ended Dec. 31, up from $233.6 million in same quarter year ago. Net income climbed 25% to $20.9 million, up from $16.8 million.
Viacom completed its previously announced purchase of BET Holdings II for $3 billion in stock and assumption of debt. Under new structure, BET founder Robert Johnson will remain chmn.-CEO of BET, reporting to Viacom COO Mel Karmazin. Debra Lee will stay on as BET’s pres.-COO. BET also will keep its home in Washington.
Jonas Neihardt promoted to head of Washington office, Qualcomm… Wendy Cutler, ex-USA Networks, appointed dir.-member services, Cable TV Ad Bureau… Randy Livingston, ex-OpenTV, becomes vp-business affairs and CFO, Stanford U… Barry Boniface, ex-Cypress Communications, named vp-corporate development, BellSouth… David Coler promoted to COO, National Decision Systems…Michael Jordan, exec. chmn., Clariti Telecommunications International and ex-CBS, elected to ScreamingMedia board.