Broadband Cable Association of Pennsylvania


July 9, 2012

For Harland Bergstrom, the cable business is just a way of life.

So when he received an award from Broadband Cable Association of Pennsylvania for his contributions to the "development and success of the organization's programs and events," it was almost like an honor for lifetime achievement. "To me, this is just a way of life," he said. "Cable is what I do."

Bergstrom is vice president and general manager of Cable Services Co. Inc., Williamsport, a member of the Broadband Cable Association.

Association President Dan Tunnell noted that Bergstrom has demonstrated his support for the organization. "He has repeatedly stepped up to strengthen our programs, add value to association endeavors," he said. "We couldn't be more grateful for his tireless efforts and contributions to our organization and the cable industry, and are proud to formally recognize that commitment by presenting him with our President's Award."

The Broadband Cable Association, founded in 1957, promotes broadband cable and telecommunications industry issues statewide, including the development of advances in technology, programming and the Internet. Bergstrom said among his duties has been helping the organization with lobbying efforts on the state and federal levels. In addition, he has served on its board of directors and is active with Pennsylvania chapters of the Society of Cable Telecommunications Engineers.

He was attending the association's Cable Academy conference in Harrisburg this spring when he learned he received the President's Award. "I was really surprised," he recalled with a laugh. "I was sitting there and they started reading off things that sounded very similar to my life." He said he was very humbled by the award.

Bergstrom, a graduate of Coudersport High School, has been in the cable business most of his life. After studying electronics at the former Williamsport Area Community College, he took a job in 1977 as an installer with Charles Construction Co.'s cable television service in Jersey Shore. "We did anything that was required. It was multi-tasking," he recalled. When the company was sold, he took a job with TV Cable of Central Pennsylvania, eventually rising to rank of general manager. He came to Cable Services Co. in 1997.

The company, a full-service provider to the telecommunications industry specializing in broadband infrastructure design, employs 110 people. Services include design and construction, engineering, mapping and design, maintenance, installations, product sales and distribution, consulting and project management. Bergstrom is in the middle of it all, with a lot of responsibilities. He said he occasionally misses his earlier days in the industry when he worked out in the field. "The older I get, the less I miss it," he laughed.

Over the years, Bergstrom has seen a lot of change in the business. There's more channels for people to find on cable TV, and of course, there's now the Internet. "There's more people using fiber optics," he added. He said he is surrounded in the workplace by a lot of good, talented people.

"I don't think you are going to find anyone who says anything bad about Harland," said Gene Welliver, a Cable Services vice president. Bergstrom, for his part, said he's happy to do whatever he can to support everyone at the company. Williamsport Sun-Gazette

The stock-market signal for satellite-television providers has grown fuzzy the past year. But investors may want to tune back in.

One reason shares in companies such as DirecTV and Dish Network have failed to keep pace with cable rivals and the broader market is broadband, or the lack of it. As programming costs rise in the video business, cable providers have found that broadband can help ease the pain. Those operators can expand broadband penetration and push customers to faster, more expensive connections to protect overall margins. Providing broadband also helps soften the blow from so-called cord cutters who quit video services altogether in favor of online streaming.

Single-service satellite companies, meanwhile, have nowhere to hide. Plus, factors that once differentiated satellite service from cable, such as a greater variety of high-definition channels and DirecTV's football package, are no longer so novel: Cable has expanded its channel offerings and the NFL RedZone channel has become available. Investors are well aware of these threats. Shares in DirecTV and Dish have fallen 4.9% and 8.3%, respectively, over the past year, while the S&P 500 has gained 2%. Cable provider Comcast's stock has risen 22%, while Time-Warner Cable is up about 3%.

Now, both satellite providers trade at slightly more than 10 times forward earnings, compared with more than 15 times for Comcast and about 13 times for Time-Warner Cable. DirecTV, which has historically traded at a premium to Dish and has a fast-growing Latin American business, looks cheap. It is forecast to grow earnings per share by 26% in 2012 and 21% in 2013, against Dish's expected 18% decline in 2012 and 7% gain in 2013.

A good portion of DirecTV's earnings growth is due to share buybacks, which are financed by heavy debt issuance. But the company is still adding subscribers in the U.S., albeit at a much slower pace, and has been surging in Latin America, where the number of subscribers has risen in each of the last six quarters. That division contributes roughly 20% of revenues and 25% of earnings before interest, tax, depreciation and amortization. DirecTV is also expected to generate free-cash flow of $2.2 billion in 2012 up 7.6% on the prior year. Dish meanwhile is expected to see a 17% year-on-year decline.

This doesn't negate the fundamental problem facing satellite providers. DirecTV's margins are expected to be flat or down over the next few years as programming costs rise in the U.S. Latin American growth could also slow as competitors catch up. Still, even with margins under pressure, DirecTV's profits should continue to grow as revenue climbs. It has been curbing discounts, targeting higher-end customers and focusing on reducing churn to protect margins. At these levels, investors should look past the pessimism. Wall Street Journal

Comcast is close to selling its stake in the A&E cable networks, which would bring in nearly $3 billion for just 15 percent of the company, an executive briefed on the negotiations said Friday. The deal, first reported in The New York Post, has been in the works for many months, and now awaits approval from banks involved in lending the money.

A&E Networks, whose majority 85 percent stake is co-owned by ABC-Disney and the Hearst Corporation, will actually make the purchase of the Comcast stake itself, and will pay back the loan from the networks' profits. Those are considerable. The executive aware of the negotiations said that A&E, which runs two top-rated cable networks, the History Channel and A&E, as well as the profitable Lifetime network, generates about $1.4 billion in profits for its owners annually. The sale price for Comcast's stake, about $2.8 billion, means A&E Networks is now worth about $20 billion, making it one of the most valuable properties in the television business. The company has had strong growth over the last year, with several shows becoming hits - led by the spectacular success of the mini-series "The Hatfields and McCoys," which set cable viewing records. Its programming has also become popular on many international television outlets. New York Times

ESPN will kick off an effort to allow more political ads on college and NFL football programs in October and November, according to a report. The sports network signed on with NCC Media LLC, an ad-sales venture, to sell a larger portion of its advertising time to political campaigns, The Wall Street Journal said. The network is selling NCC advertising inventory that the network would have normally sold to national advertisers for the fall.

Ed Hardt, ESPN's president of global customer marketing and sales, told the newspaper that there is "great demand" for political advertising from "political parties and the super PACs." Thus, in the crucial two months before the November election, viewers can expect their shotgun formations and weak-side blitzes to be occasionally peppered with pitches for Mitt Romney and Barack Obama, among other candidates. For political advertising, cable television has historically played second fiddle to to broadcast television, which is more locally oriented. Cable's increased ratings and an ability to more narrowly target viewers have changed that somewhat. It is expected that $5.64 billion will be spent on political advertising on broadcast television in 2012, while cable remains far behind at $940 million, WSJ reports.

The amount spent on cable, however, is nearly double the $478 million spent during the 2008 campaign. Politico

It was seven years ago on July 7 at 2 a.m. that the Pennsylvania Legislature without debate voted itself pay raises ranging from 16% to 34% and, unwittingly, set off a chain reaction that would alter the state's political landscape. But how much really has changed?

The immediate impact of the vote, which included a provision allowing lawmakers to take the money at once despite a prohibition in the state Constitution against doing so, was an awakening of public awareness of how the legislature operates. It led to outrcy from grassroots groups such as Democracy Rising, Rock The Capital and PACleanSweep and much more media scrutiny. Largely because of these groups, two top Senate Republican leaders, Bob Jubelirer and Chip Brightbill, were defeated in the 2006 GOP primary, and a House Democratic leader, Mike Veon, was defeated in the 2006 General Election.

The raise focused far more public and press attention on the Legislature than ever before and kicked off a period of investigations that led to indictments and convictions of dozens of lawmakers and staffers, including Veon and other leaders such as Vince Fumo, Bill DeWeese, John Perzel, Jane Orie and Brett Feese. So there's been change. Since 2005, more than half the Legislature is new and 100% of the leadership at that time is either gone or in different legislative positions, according to a Temple study. But some things haven't changed.

Rules that the Legislature put in place to prevent further late-night abuse are only rules and not laws and so are routinely violated or, as they say, "suspended" whenever they feel the need, as they did recently in order to pass the new state budget "on time." And the online news service PA Independent reports that part of that new budget, which ends general assistance to tens of thousands of poor people, includes increases for House and Senate members' health-care coverage and still promises them annual cost-of-living salary increases in December. (I'm always amused by lawmakers who rail against cuts in social services for the needy but never offer cuts in their own excessive benefits, perks and pay.) The '05 debacle was a kick-starter towards needed housecleaning and at least some reforms. It shouldn't be forgotten. And it should serve as a reminder that more should be done. blog