Broadband Cable Association of Pennsylvania


December 19, 2012

For years, cable television subscribers in the Lehigh Valley have been able to see news broadcasts from the Scranton and Wilkes-Barre region on WNEP Channel 16. But that will end in January when both Service Electric and RCN stop carrying the station. The change should help boost the audience of WPVI Channel 6 in Philadelphia, the Valley's designated ABC affiliate. Currently, both WPVI and WNEP provide ABC programming to Lehigh Valley cable subscribers. The result is that some Lehigh Valley television viewers are seeing programs on WNEP instead of WPVI, which can reduce the size of the WPVI audience and affect the rates it charges advertisers for air time.

At issue are arrangements regarding which stations serve specific markets. The Lehigh Valley is part of the Philadelphia designated market area, for which WPVI is the ABC affiliate. WNEP is the ABC affiliate in the much smaller Scranton and Wilkes-Barre region, which has about 590,000 homes. Most of the programming between the two stations is duplicative, with local news being the primary exception.

The Lehigh Valley makes up about 20 percent of Philadelphia's designated market area, the fourth-largest television audience in the country with some 3 million homes, according to the Nielsen Co. The Valley is also home to many coal region transplants who have been able to keep tabs on their hometowns by watching WNEP, which airs about 50 hours of local news each week that is not available on WPVI. Exactly why the change is happening now is not clear. "This should have happened a long time ago," WNEP's general manager, Chuck Morgan said, declining to discuss details. WPVI did not return calls seeking comment.

Service Electric notified its subscribers of the pending change in their bills. "WNEP Channel 16 notified us that the owner of their station has made an agreement with ABC Television Network not to distribute outside the Scranton Wilkes-Barre market," said Joe Macus, vice president of Service Electric. "We are located in the Philadelphia designated market area. ...We have no choice but to remove [WNEP]." WNEP offered to let cable companies serving the Lehigh Valley continue to air its programming that did not duplicate what was being aired by WPVI and block out everything else. Cable companies rejected the idea of paying WNEP for a channel that would be blocked out most of the time. "Unfortunately, 70 percent of their programming is duplicative, which means there would be very little left," RCN spokeswoman Joanne Guerriero said.

Whatever the reason for the change, the practical effect for Lehigh Valley cable viewers is they will no longer be able to tune in to WNEP for news about the Scranton and Wilkes-Barre region. At least not on their televisions. The station live streams all of its news broadcasts at, Morgan said, which it is explaining to viewers upset about losing the channel. "We've been getting calls from viewers who love our station and are shocked that they won't be able to see it anymore," Morgan said. Allentown Morning Call

Comcast Corp., the largest U.S. cable company, saw its market value close above $100 billion for the first time, validating the bet it made on NBC Universal almost two years ago.

Since it bought a controlling stake in NBC on Jan. 29, 2011, Comcast's stock has increased by more than two-thirds. The company has benefited from improving prime-time ratings among 18- to 49-year-olds at the broadcast network, which climbed from last place to first this season. Comcast, which has about 22 million cable-TV subscribers, now has a higher market capitalization than McDonald's Corp., Home Depot Inc. and Walt Disney Co. And its closing in on technology heavyweights such as Intel Corp., Cisco Systems Inc. and Qualcomm Inc. Comcast's ascension is emblematic of both a successful acquisition and an industry that's thrived during difficult economic times, said Frank Louthan, an analyst at Raymond James & Associates Inc. in Atlanta. "If you go back two years ago, everyone thought people would cut expenses, but as it turns out, Americans will pay their cable bills before they pay their mortgage," Louthan said. "As incomes come down, cable and Internet both look like pretty good values." Comcast rose 1.4 percent to $38.05 at the close yesterday, a record high, amid a broader wave of cable-stock gains. Time Warner Cable Inc. climbed 0.4 percent to $96.27 for a 51 percent increase this year. Charter Communications Inc., up 30 percent this year, advanced 4.8 percent to $74.14 yesterday.

Comcast is the best performing stock in the 16-member Standard & Poor's media index this year. While the Philadelphia- based company shed cable-TV subscribers in 2012, the losses have shrank year over year for eight straight quarters. Comcast's reliable revenue flow also appeals to investors in a shaky economy, said Louthan, who has the equivalent of a buy rating on Comcast and a $42 price target.

"As small-business growth stagnates, recurring revenue models will continue to add value, and that's where investor dollars will flow," he said. Comcast spent $13.8 billion in cash and assets to buy its majority stake in NBC. Chief Financial Officer Michael Angelakis said in September Comcast is considering purchasing the remainder of NBC, owned by General Electric Co., in 2014. The network has relied on hit shows such as "Sunday Night Football," "The Voice" and "Revolution" to boost ratings this year, following years of last-place showings. Bloomberg