Mtv, Box Take Steps In Digital Programming

NEW YORK‹Digital cable has been touted as the latest wave of technology to revolutionize TV, but what does it mean to the music video industry? By most estimates, it means a relatively small audience for spinoff music channels in 1998‹and rapid growth in years to come.
Both MTV and the Box are moving forward with plans for their spinoff channels. On June 30, MTV announced the first cable deal for its new digital channels (Billboard Bulletin, July 1), while the Box continues to expand its spinoff-channel offerings on digital cable.
Most cable TV systems operate on analog platforms whose channel lineups are usually filled to capacity. Upgrading to digital cable lets a system add dozens of new channels to its lineup. But such upgrades are costly and time-consuming investments for cable operators.
As a result, cable operators must roll out digital cable gradually in neighborhoods. It's not uncommon for one part of a large city to have access to digital cable while the other part hasn't been upgraded yet, even when all parts of the city are serviced by the same cable provider.
The cable-TV industry's seemingly slow pace at fully upgrading to digital is reflected in the statistics. According to the analyst firm Paul Kagan & Associates, there are about 65 million U.S. cable-TV subscribers. By the end of 1998, the projected number of U.S. subscribers to digital cable will be 600,000. But by 2000, that number is expected to rise to 9.6 million subscribers.
MTV Networks has pacted with U.S. cable-TV consortium Telesynergy to carry its 10 new digital music-video channels. Telesynergy reaches approximately 5.5 million analog cable-TV subscribers in different states, and its systems are gradually upgrading to digital. An MTV spokeswoman says the channels' availability "will depend on which markets have upgraded to digital cable." Such upgrades will continue over the next few years.
Telesynergy's 12-member system operators include St. Louis-based Charter Communications; Toledo, Ohio-based Buckeye Communications; Denver-based Rifkin & Associates; Wichita, Kan.-based Multimedia Cablevision; and Columbus, Ohio-based Coaxial Communications.
MTV Networks' music spinoff channels are MTV "X" (which plays hard rock/heavy metal), MTV "S" (Latin music), VH1 Soul (R&B), VH1 Smooth (jazz and new age), and VH1 Country. Along with the free-form music channel M2, the spinoffs will be offered in a digital cable-TV package called the Suite from MTV and VH1 (Billboard, Dec. 6, 1997). The Suite's original launch date was July 31 but has been changed to Aug. 1.
The Box has six spinoff channels on digital cable, most of which launched in November 1997: Pulse (top 40 music); Classic (classic rock/R&B); Edge (alternative rock); Urban (R&B); and a Tejano and Latin music channel.
"It's not enough to have a group of [spinoff] music channels with your company's name on it, because different types of music have different audiences," says the Box's president/CEO Alan McGlade. "We've found the best way to position these channels is to cluster the programming around similar channels. We like to have our urban spinoff channel in markets where they carry BET or BET on Jazz. The Pulse top 40 channel is for a mainstream environment. And our Latin music channels work in areas where there's a strong Latin market."
BET has also announced it will offer a digital-cable package called BET Soundz, which will consist of four new spinoff channels focusing on rap/hip-hop, world music, gospel, and R&B (Billboard, May 16). Names and a launch date for the new BET channels have yet to be determined.
Interscope Records video promoter David Saslow says, "As long as these spinoff channels stay music-driven, we're all for them. But I don't think most of the general public is really aware of digital cable. The cable-TV audience tends to be passive when it comes to finding out about new lineup offerings, and they need to be directed to these new music channels."
MTV/VH1 senior VP of programming enterprises Matt Farber says, "Our emphasis to record companies is that the spinoff channels are, for now, a local opportunity to promote their artists. Advertising for our new spinoff channels can't be national at this time, because digital cable is still being rolled out locally. We plan to work with cable system operators to create customized promos for the spinoffs."
Digital cable is still in its infancy, so it remains to be seen what type of impact it will have on breaking new artists though music video. As Farber notes, "I think it's important to have realistic expectations. The music industry should know that right now, digital cable is still a small offering, but it has long-term opportunities."