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Advance/Newhouse buy out of Time Warner Orlando ??

Here is an article written it the Orlando newspaper about Advance/Newhouse taking over operations of Time Warner in the Central Florida region,,, give us your comments,,,,,,,

Cable firm is wired for service

By Susan Strother Clarke | Sentinel Staff Writer
Posted October 27, 2002

It is known as the "roll of quarters" story.

Years ago, on a snowy day in Syracuse, N.Y., Robert Miron realized his phone was dead. He knew the trouble was caused by the cable-TV technician who had just worked at his home.

So Miron grabbed some quarters and went to the nearest pay phone. He dialed the cable company, which his family happened to own.

He was put on hold.

He called again and again, depositing quarter after quarter, and learning first hand -- in the snow and cold, no less -- the frustrations of an ordinary cable customer.

Little surprise that today, Miron -- who will soon control Orlando's largest cable system -- is a stickler for customer service.

Central Florida is at the center of one of the largest cable-television deals of the year -- the multibillion-dollar transfer of subscribers and assets from Time Warner Cable to Advance/Newhouse Communications, over which Miron is chairman.

The transaction, announced in late June, restructures a seven-year partnership between Time Warner and Advance/Newhouse.

Time Warner will shed 2.1 million customers in the amicable breakup, handing them over to one of the first families of U.S. publishing. Nearly 80 percent of the subscribers are in Central Florida, including 710,000 in and around Orlando and 950,000 customers near Tampa Bay.

Once the deal closes Dec. 31, Advance/Newhouse will become the country's eighth-largest cable operator. The transfer of control should be transparent to current Time Warner customers, who may be unaware of the change until asked to make their monthly payments to a new company.

The Newhouse group enters the market as a nimble, privately held company with the financial ability to buy more cable-TV systems. Industry insiders say the company may already have kicked the tires at systems owned by Adelphia Communications, the bankrupt cable operator that serves about 38,000 subscribers in Orlando.

Moreover, Advance/Newhouse tends to promote innovation among its local business units, which is good news in Orlando, where the cable system has undergone a $350 million upgrade and is one of the most advanced in the country.

"This is good for customers and good for employees, not for some guy in Syracuse," said Miron, 65. "We are going to run this in a very decentralized way. We think we have excellent people in the Orlando division and we're going to rely very heavily upon them."

The Newhouse family's career in U.S. publishing began in 1922 when Samuel I. Newhouse Sr., a one-time office boy for a New Jersey weekly, purchased the Staten Island Advance.

Today, his sons -- Samuel Jr., or "Si," and Donald, who are Miron's first cousins -- oversee an empire with estimated sales of $4 billion a year. The family publishes daily newspapers in 26 cities as well as 41 weekly papers, including the Orlando Business Journal.

The Newhouse family is the second-largest magazine publisher in the country, behind Time Inc. Newhouse owns Conde Nast, which publishes Vanity Fair and The New Yorker; Fairchild Publications, which publishes Women's Wear Daily; and Parade Publications, publishers of Parade Magazine.

The family releases few details about its businesses. Miron, who has 30 years experience in the cable-TV industry, is an executive who answers his own phone, yet politely declines to provide detailed answers to most questions.

But according to financial documents, Advance/Newhouse and Time Warner began working together in 1995. Miron's firm brought 1.5 million cable customers to the table; in exchange, Newhouse became a silent partner and owner of a one-third interest in Time Warner's cable operations covering 7 million subscribers.

Two years ago, America Online and Time Warner announced a $106 billion merger. Observers say the Newhouse family began to fear that its cable interests would suffer as the combined AOL Time Warner worked -- and, at times, struggled -- to meet obligations.

After several months of negotiation this year, Advance/Newhouse exercised its options to unwind the partnership. In the new arrangement, it is the controlling operator of cable systems in Orlando, Tampa and four other cities, as well as several smaller markets.

According to financial information Advance/Newhouse has submitted to Orange County government, the company expects double-digit growth in the systems' annual profit starting in 2004. And revenue, projected to be about $1.4 billion this year, is expected to exceed $2 billion by 2006.

"We're pleased with the new arrangement," Miron said.

Many within the industry expect that Advance/Newhouse's involvement in certain markets will result in new partnerships. In Orlando, for example, the company will inherit for at least another year its partnership with Sentinel Communications Co., publisher of the Orlando Sentinel, to jointly operate Central Florida News 13, a 24-hour news channel. But there is speculation that there could be a future arrangement with the Orlando Business Journal.

Advance/Newhouse launched a contest in late summer among its 5,000 newly acquired employees to rename the cable company. Dozens of suggestions came from Orlando. The new name will be unveiled early next year.

During visits to Orlando, Miron has assured local employees that their jobs are safe.

And he has stressed that customer service is one of the most important things a cable company can provide. During his term as chairman of what is now known as the National Cable & Telecommunications Association in the 1990s, Miron helped the industry recover from its reputation for poor service by emphasizing good customer relations and on-time service guarantees.

Some observers speculate that Miron may urge the Orlando system to eliminate some of its outside contractors -- and provide the potential for greater customer satisfaction by bringing all its installation and repairs in-house.

"Treating the customer well," Miron said recently, "and providing good customer service are exceedingly important."

The Central Florida cable operation will continue to be run by John Rigsby, who came to Orlando for Time Warner in 1995 and who has a stellar reputation. Rigsby, 56, has overseen subscriber growth of 42 percent.

Moreover, he has been the steward over its transformation into one of the most sophisticated providers in the industry. Local customers have access to high-speed Internet and high-definition television, as well as video on demand.

"One of the things that was attractive to Newhouse was the local team and the success with what we have been able to do with the network," Rigsby said. "We have always been innovative. We're setting that tone."

In fact, Rigsby has been so successful locally and in a previous position in New York that there is speculation that he may be elevated within Advance/Newhouse to overseeing more than the Orlando cable system.

Susan Strother Clarke can be reached at (-REDACTED-) or 407-420-5414.
Copyright © 2002, Orlando Sentinel
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