When Bresnan Communications jumped back into cable 17 months ago, one of the first issues it had to face was local ad sales—as in where to sell. With systems covering about 314,000 customers in Colorado, Montana, Utah and Wyoming, Bresnan decided that handling the sales process everywhere would be too big a job; many of the systems needed upgrades in ad insertion and billing equipment. So Bresnan focused its sales efforts on the Montana systems and in Cody, Jackson Hole and Powell, Wyo., and let Comcast handle the rest through its Spotlight unit. Despite major equipment upgrades and a strategy that sometimes pinpoints individual programs more than channels, local and national spot ad revenue for the systems Bresnan reps internally—covering 45% of the company’s subscribers—have met or exceeded monthly projections. Kelly Enright, the operator’s ad sales general manager, anticipates revenue, operating income and cash flow for his unit will increase by 4-5% this year. Enright saw the challenges facing Bresnan before he joined the operator last June from a key role at Cable Advertising of Metro Atlanta. "At CAMA, you sell one puppy, one market, one DMA," he says. "There’s a lot of dirt between our systems in Montana. You can go miles without being in one of them. Ten systems were still using analog insertion gear, and the billing system in many places was antiquated." In order to "get everyone on a level playing field right away," as Enright puts it, the Montana and Wyoming systems were equipped with digital insertion gear from nCube and billing software from Novar. National Cable Communications was brought in to generate a Montana national spot interconnect, and Enright hired former Comcast and broadcast TV official Michael D’Ambra to attract regional and national clients. After the upgrades, a uniform network lineup for local/spot sales was instituted. Avails on eight channels, including CNN, ESPN and TLC, are sold in all markets. For Billings, Great Falls and Helena—Bresnan’s largest Montana locations—24 channels have local avail time. "We hope to roll out 24 insertable channels in other places where it makes sense down the road," Enright explains. "Once we got our networks arranged correctly, we focused on high-profile shows—NFL Sunday Night Football on ESPN last fall, Trading Spaces on TLC and Sex and the City on TBS—and we gave the account execs incentives to emphasize those shows with advertisers. It became another stepping stone to attracting new clients." In particular, these changes have helped Bresnan attract business from Montana’s state government. Besides campaigns from state tourism authorities, Bresnan picked up new ads from the state transportation department and other agencies. Enright estimates that state advertising could account for as much as 10% of the MSO’s sales revenue this year. Unfortunately, the Democratic primary process didn’t make it to Montana and Wyoming this time around, and the outlook for state and local spending on the presidential campaign isn’t promising. Under AT&T Broadband, the systems generated $800,000 in revenue from candidate expenditures during the 2000 presidential campaign. At most, this year’s campaign will contribute 2% of Bresnan’s ad revenue, Enright estimates. Another disappointment is expected to be the 2004 Summer Olympics cable coverage this week and next. Enright attributes low ad sales to late calls by NBC Universal over where coverage would run, such as whether USA Network would be involved, and general uncertainty over terrorism and security issues. On the plus side, there’s ESPN’s NFL games, with advance sale commitments up 50% over last fall. Separately, there’s a special dual-media relationship with the Montana Lottery, in which cross-channel messages are complemented with banner ads on Bresnan’s website. More online/TV combo buys will be explored in the months ahead, Enright says. Free video-on-demand advertising is another direction Bresnan will pursue, but not until early 2006, when VOD is operating in all company-owned franchises.

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