• by Wayne Friedman , Staff Writer, December 22, 2004

Cablevision Systems has taken its head out of the high-definition TV clouds; it is looking to sell or stop its money pit high-def programming enterprise Voom after barely one year in existence.

Daily Variety said analysts were scratching their collective heads wondering why Cablevision started Voom in the first place - especially when two bigger satellite services DirecTV and EchoStar already offer many high-def channels.

Voom only got to 26,000 subscribers. The Hollywood Reporter said one analyst was expecting the service to turn from a trickle of red ink into a tidal wave, losing $200 million in cash flow in 2005.

This coincided with the news Cablevision's Rainbow Media Enterprises, its programming division of which Voom was a major piece, would not be spun off. All this gave Wall Street an early Christmas present as Cablevision's stock climbed 13 percent yesterday to $25.06.

Cablevision has enough problems. Last year it witnessed the departure of 14 senior executives due to an SEC investigation over accounting problems stemming from Rainbow's American Movie Classics channel.

Recently, Rainbow announced several promotions in restructuring the division. The New York Times quoted one analyst who said Rainbow's programming group would be a better performer at NBC Universal, Walt Disney, or Viacom.

Big cable system operators have enough to do these days than try to launch programming services that are duplicated, at best, with other sellers. It's better that cable system operators improve distribution and technology, and of course, tighten up those loose appointment schedules where customers wait all day for new or upgraded service.

The savaging has started. Cablevision might be able sell its significant satellite capacity, which is part of Voom, according to The Hollywood Reporter. Five satellites are to be constructed by Lockheed costing Cablevision $740 million. But Daily Variety wondered since the delivery hasn't been completed whether the deal is still going forward.

Echostar, a 10 million-subscriber satellite service, is in more need of this satellite capacity than DirecTV, the bigger 12 million-subscriber service that, at the moment, has adequate capacity.

Now if only Cablevision can improve the stock of its lackluster New York Knicks.