Lucky you! If you live beyond the reach of Washington, DC, television stations, you may have avoided this spring's bombastic barrage of TV commercials about the future of TV. According to this endless bombardment of advocacy ads, TV's future depends largely on who runs the nation's video delivery system. And it comes down to the role that telephone companies can play. Or so you'd think from the punch lines of these 30-second messages.
The costly advocacy campaign, of course, was aimed at a few dozen legislators and their staffs. At its peak, the media buying approached $1 million per week just within the Washington, D.C., area. AT&T (the company formerly known as SBC Communications, and before that as Southwestern Bell) and the U.S. Telecom Association, the telephone companies' major trade group, were the big spenders. The National Cable & Telecommunications Association, which is in the midst of $1 million spending spree this year to tout cable's role in the telecom future, ran some of its commercials in the Beltway TV blitz.
Amidst predictable invective, the telco commercials alleged that cable TV rates have blasted upwards of 80 percent in recent years. They urged Congress to allow video competition (i.e. telco entry) as the only way to bring prices down. One commercial focused on telco overbuilding (Verizon's Keller, Texas, prototype), making that Dallas suburb look like a remote ranching town rather than the upscale development it is.
For its part, the cable TV industry's campaign focused on the creation of American jobs and cable's entrepreneurial spirit. But NCTA also smacked telco culture. One spot, in grim black-and-white to evoke dust, purported to show stodgy telephone executives lethargically lumbering toward new services, in contrast to cable's swift efforts.
Note: If you're a glutton for political posturing, you can view streaming videos of several commercials. Here's where to find them:
To anyone outside the industries and the legislative target audiences, the saturation ad campaign is nothing short of perplexing. And that's how the cable lobbyists want it. So long as legislators are confused, they will not vote to unleash telephone companies into the video delivery business, NCTA officials told me with hope in their voices.
The TV ads seemed never-ending, especially while Congress was in session and the bill from Rep. Joe Barton (R-Texas) authorizing national cable franchises was under consideration. Even after the House Commerce Committee approved Barton's bill in late April, the ads continued.
They appeared with such frequency that commercial pods often had back-to-back commercials from both sides--thereby ensuring confusion to all but the most assiduous viewers. Most of the commercials seemed to run during local newscasts and public affairs shows and adjacent to upmarket programs likely to be viewed by the target audience. A Washington investment analyst jokingly confessed to me that he must watch the same shows as the targeted congressional staffers--given the frequency he saw the pro- and antitelco TV messages.
Adding to everyone's confusion was the sprouting of "astroturf" campaigns. That's the term for the faux "grassroots" groups that spring up during hotly contested battles such as this one: designed to create the illusion of public interest"support. For example, the benignly-named "TV 4 Us Coalition" made frequent commercial appearances, stressing its slogan "We want choice" as it aggressively cited cable TV operator abuses.
The roster of Coalition members includes The National Taxpayers Union, the Latino Coalition, the Small Business & Entrepreneurship Council, the Women's Presidents Organization, the Construction Industry Foundation, the Citizenship Foundation--and, oh yes, a dozen telecom manufacturers, the National Association of Manufacturers and AT&T. You can probably guess correctly whose money actually paid for the coalition's ads.
Meanwhile, the cable cause is abetted by groups such as the "Broadband Everywhere Coalition," a campaign--mostly using print media for now--that focuses on what it calls "The Phoneys." Funded by NCTA, the American Cable Association plus African-American, Hispanic and women's groups, "Broadband Everywhere," has propounded "myths versus realities" to point out that the telcos have failed in all their previous efforts to develop video services.
At its peak, the various campaigns were spending a total of about $975,000 per week on Washington-area media, overwhelming local TV, according to data I compiled from local TV stations, broadcast monitoring services, and advertising executives. It was a nice bonanza for the TV stations. The biggest spenders were USTA, which bought about $1.5 million in TV spots during six weeks (that is, about $250,000 per week). AT&T, for its "Choice" campaign--which prominently featured the term "Competition" in its on-screen graphics--spent up to $600,000 per week. The "TV4US" astroturf assault (funded by AT&T and others) spent $75,000 per week for at least four weeks.
NCTA's budget for Capital-area ads was an estimated $50,000 per week during the spring legislative frenzy--part of the year-long campaign, which also includes print ads, bus shelter signs, airport posters and other media. In fact, the omnipresent signs from cable and telco TV promoters rolled by with such frequency--on TV and in newspapers and Washington location media--that they reminded me of a similar spending spree just over four years ago. Back then, the issue was the "Tauzin-Dingell Bill," a bi-partisan effort by top House Commerce Committee legislators about allowing local telephone companies to offer long-distance service.
The TV ad blitz of 2001-02 prompted Tony Kornheiser, a Washington Post columnist, to opine that he encountered those messages so often that he was fed up with Tauzin, he was fed up with Dingell and he was even fed up with "Bill."
As it turned out, the regional telcos Verizon and SBC eventually resolved that competition issue by buying out the long distance carriers--a move that created what I now call the "Oedipal Bells;" that is, the two dominant regional telephone companies have either married their mom (the SBC acquisition of AT&T) or a surrogate (Verizon's purchase of MCI). Indeed, finding a term for the surviving regional telcos has been my passion. Born as "Baby Bells" in 1984, they became "Adolescent Bells" by the 1990s when they started performing rowdy teenage behavior, including intermarrying (mergers) and experimenting with new gizmos (wireless).
The recent advocacy campaign spurred other thoughts about what and what is not happening in the media/telecom convergence. Washington's local incumbent Oedipal Bell telco, Verizon, was noticeably absent from the advertising deluge, despite its aggressive rollout of video service via its new FiOS fiber-optic system.
"We're doing very little D.C. advertising on our own nickel" about the legislation, a Verizon executive said in response to my query. He added that, "We do support USTA."
Meanwhile, AT&T's aggressive "Choice" campaign and its other national branding initiatives raises the prospect that the "new AT&T" could be ready to violate the old telco gentlemen's agreement to stay out of each other's territories. Verizon Wireless and Cingular (AT&T's wireless affiliate, soon to be rebranded AT&T wireless after AT&T's acquisition of BellSouth) are already crossing boundaries with mobile telephone services. As these mobile offerings add more video, the old regional Bell paradigm will be further destroyed--whatever the legislative landscape. Hence, the AT&T advocacy commercials in D.C. may serve the extra duty of reminding Beltway denizens that AT&T video is on the way here too.
There are many other nuances about this advocacy campaign. The telcos have apparently tried to run some of their campaigns on targeted cable TV networks--but the networks refused to carry them. Although specifics about such negotiations are hard to find, it is conceivable that channels owned by the same companies that run cable systems (such as Time-Warner's CNN or Comcast's sports networks) were encouraged to reject the anticable advertising by their corporate parents.
Moreover, broadcasters, who are feuding with cable operators on several other fronts, carry the profitable telco ads, although the Washington, D.C. TV channels also carried the NCTA commercials. At the same time, broadcasters continue to get cozy with telcos for future video relationships of all kinds.
All of this posturing is taking place as the consolidated telcos again see video as their next grail. Today's political playing field is telecom reform, which saw some first steps during this congressional session. Despite movement of the House legislation, substantial Senate hurdles face a telecom overhaul during the scant remaining days of the 109th Congress.
And that means, the TV battle over telco TV could go on and on into future years. It augurs contentious future advocacy advertising in and around the Capital Beltway. And more evidence of how lucky you are if you watch TV beyond that signal reach.
Gary Arlen, a contributor to Broadcasting & Cable, NextTV and TV Tech, is known for his visionary insights into the convergence of media + telecom + content + technology. His perspectives on public/tech policy, marketing and audience measurement have added to the value of his research and analyses of emerging interactive and broadband services. Gary was founder/editor/publisher of Interactivity Report, TeleServices Report and other influential newsletters; he was the long-time “curmudgeon” columnist for Multichannel News as well as a regular contributor to AdMap, Washington Technology and Telecommunications Reports; Gary writes regularly about trends and media/marketing for the Consumer Technology Association's i3 magazine plus several blogs.
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