Dolans duking it out over VoomFather and son Cablevision bosses split on booting unprofitable satellite TV venture
BY HARRY BERKOWITZ Newsday
Charles and James Dolan, the father and son who control Cablevision Systems Corp., appear headed for an unprecedented showdown over whether to abandon their ailing Voom satellite TV venture.
Charles Dolan, the Cablevision chairman and founder, apparently wants to keep the nationwide satellite service that was launched in October 2003 alive even though it is losing hundreds of millions of dollars and attracting few subscribers.
James Dolan, chief executive of the New York metro area's biggest cable TV service, who has promised investors that Cablevision would stop going off on costly tangents as it has repeatedly in the past, apparently wants to end the all-but-failed experiment. That means dropping Voom and possibly selling its sole satellite.
The Cablevision board of directors was reportedly taking up the issue Tuesday in the face of complaints from analysts and investors that Voom, which had only 26,000 customers as of Sept. 30, threatens to continue to drain company profits and hold down the stock price.
"It would be very difficult for the independent directors to approve additional spending for Voom," said Craig Moffett, an analyst for the investment firm Sanford C. Bernstein & Co. "At the same time, it would take something close to a boardroom coup for Chuck Dolan to force out the independent directors in order to renew investment in Voom. In this environment of corporate governance, that's an awfully hard scenario to imagine."
That seemed to threaten a stalemate unless Charles Dolan bowed to his son's view.
"Despite public sentiment, the company still does not appear to have decided the ultimate outcome, with the board seemingly divided, though tilted slightly in favor of selling or shutting it down," UBS investment analyst Aryeh Bourkoff told investors, adding that "dissension could lead to a public battle." The board meeting was first reported Tuesday in the Wall Street Journal.more here:http://www.avsforum.com/avs-vb/showt...hreadid=497937