APPENDIX

A Glimpse of Harrison's History

Harrison, the county seat of Boone County, is located in northwest Arkansas in the beautiful Ozark Mountains. Boone County lies 36 degrees north latitude and 16 degrees longitude west of Washington, D.C. The elevation is 1,250 feet above sea level.

Indians were the first inhabitants of the area, the first probably being the "Bluff Dwellers," who lived in caves in the bluffs along the rivers. In later times, the Osage, a branch of the Sioux, was the main tribe in the Ozarks and one of their larger villages is thought to have been to the east of the present site of Harrison. The Shawnees, Quapaws and Caddo Indians were also familiar to the area. The Cherokees came about 1816 and never got along with the Osage. This hostility erupted into a full scale Indian War in the Ozark Mountains. By the 1830's both tribes were removed to Oklahoma. Some historians contend that the first white men to visit the area were some forty followers of Hernando DeSota and that they camped at an Indian village on the White River at the mouth of Bear Creek. It is more probable that the first white men were French hunters or trappers who followed the course of the White River.

Following the Louisana Purchase in 1803, settlers started moving into the Ozarks seeking free or inexpensive land. Most of these early settlers were poor, ambitious, mainly Protestant, white, Anglo-Saxon, rugged mountaineer pioneers from neighboring states of Missouri, Kentucky, Tennessee, and North Carolina. The basic population of Harrison today is composed of descendants of these same hardy pioneers.

The greatest single occurrence affecting this area prior to the Civil War, strangely enough, did not take place here. It was the "Mountain Meadows Massacre" which took place in Utah in 1857. The ill-fated wagon train of approximately 138 people was made up primarily of families from the hills of northwest Arkansas.

The question of slavery was never a strong one in this area due to the almost complete absence of slaves on the hill farms. With the secession of Arkansas from the Union, the area furnished organized companies for the Confederate cause and the greater portion of at least two Union companies.

The period after the Civil War was only relatively peaceful. With the Reconstruction Act of 1867, Arkansas came to know the "carpet-bagger" and the "scalawag." The local Reconstruction leader, Captain Henry W. Fick, was unusual in that he was able to live with and understand the hill farmer. It was Fick who was instrumental in having Boone County organized in 1869, having the town of Harrison platted and designated as the county seat. The town was named for M. LaRue Harrison who surveyed and platted the town. Boone County was originally the eastern part of Carroll County. A slice of Marion County to the east was added six years later. There was, and is, a difference in opinion as to whether the county was originally named "Boon" as a boon to its citizens, or "Boone" in honor of Danial Boone. The organization act, however, spells it "Boone."

In the 1880's and 1890's mining flourished around Lead Hill and the first long distance telephone line reached Harrison. In the early 1900's the railroad came through, a Federal Court Division was established; a post office was built; the water and sewer systems were begun and the streets were paved.

Until World War II, progress was slow and prosperity elusive. Roads were few and poor; drought was a constant threat to the small farmer; and the state itself was too poor to provide good roads or good educations in the remote hills. In the late 1940's and early 1950's, the building of dams along the White River brought new impetus to the Ozarks.

In 1947, an airport was built and plans were made for a hospital and city hall. On July 3, 1954, Harrison was officially raised in status to a first class city. Harrison's history has been one of constant growth and improvement - in civic facilities, industrial expansion, agriculture, education and recreation. Harrison's economic base is built on manufacturing, retail and wholesale sales, agriculture and tourism.

•  

Quality Living

A remarkably high percentage of Harrison's residents came here first as tourists. They discovered that, as

the Crossroads of the Ozarks, Harrison provides a perfect place to live, whether you are thinking of relocating your family, starting or relocating a business or retiring.

Harrison has, once again, been one of the 100 best towns in the U.S. in which to live. The Report: The 100 Best Small Towns in America, published by Prentice Hall, was based on such important quality of life criteria as living costs, medical facilities, climate, recreational opportunities, educational opportunities and a leadership training program.

Whatever your age, Harrison has a lot to offer.

The public school system is fully accredited by the North Central Association. Recently, USA Today ran a front page article on the system's tradition of graduating students with test scores well above the national median.

Harrison is home to one of Arkansas' premier comprehensive two-year colleges, North Arkansas College (NAC). Students are offered wide a variety of courses and programs. In addition to the first two years of a traditional liberal arts program, the college has a variety of career programs. NAC is fully accredited by the Commissions on Institutions of Higher Education of the North Central Association of Colleges and Schools.

In addition to a new library at NAC, Harrison is home of both the Boone County Library and the North Arkansas Regional Library. A well-equipped genealogy area is a major asset of the library system. Both the Boone County Historical Society and the North Arkansas Railroad Museum Society operate a great museum in Harrison.

The North Arkansas Regional Medical Center, an ultra-modern 174-bed health care facility, provides complete medical care, including award winning emergency services. The center is also home to the state-of-the-art Claude Parrish Radiation Therapy Institute.

Community cultural activities include a well-rounded concert program provided by the North Central Arkansas Concert Association and plays presented by the Theatre Company, a local little theatre group. The nation's premier entertainers are booked nightly in Branson, only a 35-minute drive north of Harrison.

If you like native music, you will love Harrison, home to Arkansas Fiddlers' Jamboree in March, and the Northwest Arkansas Bluegrass Festival in August. Harrison has its own country music theatre, too. The Arkansas Entertainers' Hall of Fame will be located in Harrison soon, with plans calling for both a museum and an auditorium.

City parks, most located along beautiful Lake Harrison Crooked Creek which flows through the center of Harrison, provide activities for all ages. There is an outstanding playground for young children. There is a youth center for volleyball, basketball and gymnastics, a new competitive size swimming pool with water park, and a sports complex with baseball, softball and soccer fields for all ages. Each year for the past several years, the city has hosted at least one Little League World Series tournament at the sports complex.

Golfers will enjoy 18-hole courses at the Harrison Country Club and Diamond City Country Club, both challenging and scenic. Numerous other courses are within easy driving in neighboring Carroll County, Arkansas and Taney County, Missouri. Tennis and racquetball are available at Quail Tree Health and Racquet Center in Harrison.

Other outdoor activities include hiking, biking, spelunking, horseback riding; and swimming, water skiing on nearby Bull Shoals and Table Rock Lakes; canoeing on the Buffalo National River and other area streams and camping at numerous state parks, Forest Service recreational areas and Corps of Engineers parks.

Air travel, both commercial and private, is through the Boone County Regional Airport, conveniently located at the north edge of Harrison. Lone Star Airlines provides daily flights to and from DFW and St.Louis. The 6,150-foot runway which has accommodated everything from small planes to Air Force One and will be enhanced this year with the installation of an Instrument Landing System (ILS). Rental cars are available at the airport.

The airport is also home to a large regional air show in early September each year. Besides the Air Show of the Ozarks, there is both a spring and fall festival in downtown Harrison. Crooked Creek Crawdad Days in May sponsored by the Harrison Chamber of Commerce, and the Harvest Homecoming on October, sponsored by Main Street Harrison on the historic courthouse square, provide local and regional guests two fun-filled weekends. The Heart of the Ozarks Arts and Crafts Guild holds a spring and fall show. Numerous other festivals and shows are held in and near Harrison during the year. The Harrison Art League presents both a spring and fall show.

Harrison's economy is robust and diversified. Agriculture, manufacturing, distribution, health care, education and tourism complement one another. One major national trucking firm, American Freightways, is headquartered here. Many professionals in health care, education, law, computer sciences, the arts, etc., make Harrison home.

There are four distinct and delightful seasons, each enhanced by the scenic natural beauty of the Ozark Mountains.

So, if you are even thinking of relocating, come make Harrison your vacation headquarters and you will see why the Crossroads of the Ozarks should be your future home.

 

•  

Bits & Pieces

• Harrison is the Boone County seat.
• Harrison is governed by a mayoral/city government.
• Harrison has once again been as one of the 100 best towns in the U.S. in which to live.
• Harrison is known as the Crossroads of the Ozarks.
• Harrison has the very best scenery the Ozark Mountain Region has to offer.
• Harrison has an estimated population of 10,700.
• The Crooked Creek runs along the downtown of the city.
• Five major lakes, Bull Shoals, Norfolk, Table Rock, Beaver and Taneycomo, are all within an hour's drive from Harrison, where fishing and water sports are popular.
• Harrison has an excellent school and library system.
• Harrison is home of North Arkansas College.
• Harrison is easily accessed by Highways 62, 65, and 412.
• Highway 7 is listed in the top ten scenic roads in the United States (Car & Driver Magazine)
• Harrison is served by The Harrison Daily Times newspaper, KBCN, KCWD-KNWA and KHOZ FM radio.

Nearest Metropolitan Areas:

• Dallas, TX: 379 miles SW
• Little Rock, AR: 140 miles SE
• Kansas City, MO: 214 miles NNW
• Memphis, TN: 231 miles SE
• Springfield, MO: 80 miles N
• St. Louis, MO: 300 miles NE
• Tulsa, OK: 201 miles W

Climate

Our climate is typical of mountainous south central United States. Our higher elevation and terrain moderates both the cold winters of the north and hot summers of the south. We usually enjoy four distinct seasons and ample rainfall. We tend towards humid rather than arid weather. The summers are often broken by a scattering of pleasant days and nights and the winters are frequently broken by warm sunshine and clear skies.

• Mean daily maximum temperature: 72 degrees.
• Mean daily minimum temperature: 46 degrees.
• Normal Humidity (mean daily noontime): 53%
• Normal Humidity (mean daily midnight): 77%
• Maximum temperature of 90 degrees and over: 73 days
• Minimum temperature of 32 degrees and under: 91 days
• Degree days to 65 degree base: 3,803

Industry, Work Force and Employment

Our work force is composed of people who have lived here for most of their lives. Our general level of skill and education is much higher than one would expect to find in a community of this size. The particular skills and educations vary as much as the tasks where they are employed. Although unemployment statistics indicate a stable low percentage of unemployment, many of our entry level jobs are at minimum wage, but our highly skilled/educated jobs pay wages competitive with other communities in the region. Many industry employers have developed from companies started in Harrison: American Freightways, Millbrook Distribution Services and Pace Industries are three examples.

Types of industry are aluminum die casting, fishing rods, wood products, school and display equipment from wood and aluminum products, packaging control systems, gas dryer valves, tool and die, mattress making, concrete blocks, robotics, wallboard mould and die casting, saddles and harnesses, leather belts, screening equipment, plastic injection moulding, fiber glass tanks, box manufacturing and labeling.

More information about Harrison's major industries and employers is available in the business section of our web pages.

Taxes

Personal Property must be assessed between January 1st and April 10th at the Boone County Assessor's office located on 201 Main Street. Sales tax in Arkansas is 4.625% Boone County has an additional 1% tax and Harrison has a .5% temporary tax, for a total of 6.125%. More detailed information regarding taxes is available in the business section of our web pages or call 870-741-3783.

Government

Harrison is the county seat of Boone County and as the main governmental activities of the county are centered here. These activities include the county judge and his road crews, the county sheriff and the attendant law enforcement operation. Boone county is governed by an elected county judge and quorum court members representing different areas of the county. Harrison city government is operated by an elected mayor and alderman elected at large.

Also in Harrison: offices for State Revenue, Employment Security Division, Social Security, Soil Conservation, Forestry, U.S. Department of Interior, Game and Fish Commission, State Highway Resident Engineer, State Weigh Station Division, FHA, etc. Rarely does one have to leave town to interface with any governmental agency.

For information regarding Arkansas' State Government, please see the Government Relations Home Page.

·         Government Form

·        City: Mayor
P.O. Box 1715
Harrison, AR 72602
870-471-2525

City Council

County: Judge, Quorum Court

·         State Representative: District 29

Jim Milum (R)
607 Skyline Drive
Harrison 72601
(H) 870-741-7532
(W) 870-365-0042

·         Police Protection

Number of officers: 29
Equipment: 14 (radio-equipped patrol cars)

·         Fire Protection

Number of paid fire fighters: 25
Number of volunteer fire fighters: 5
Equipment: 9 units Fire insurance rating: Class 5

·         Planning and Zoning

Officials plans complete; ordinances enforced.

Community Events

The Harrison area is the scene of many annual festivals and other recreation activities. The Crooked Creek Crawdad Days is held in May along the banks Crooked Creek (Lake Harrison). Crooked Creek Crawdad Days feature crawfish, barbecue, arts and crafts booths and other activities.

The Ozark Mountain Bike Tour is held the second week in June; Fourth of July celebration on the Harrison Square includes arts and crafts booths, tricycle parade, Antique Auto Show, ending with a fireworks display.

The Coca-Cola Air Show of the Ozarks arrives in Harrison the weekend after Labor Day in September with many top aerobatics and statics to entertain large audiences. Also a musical concert has been added for your enjoyment.

The Boone County Fair is held the following week.

Date: 12/05/86 Category: Page: City Byline: FORT SMITH _ A federal agency has accepted a bid from Superior Federal Bank of Fort Smith to buy the assets of Guaranty Federal Savings and Loan Association of Harrison but closing on the agreement has become bogged down in details, Bruce Mc Neill, Superior's president and chairman, said Thursday. Superior was notified in August that it was the successful bidder for Guaranty, which the Federal Home Loan Bank Board closed a year ago and then reopened as a new institution, Mc Neill said. Negotiations on closing the transaction have continued since then. $119: FORT SMITH _ A federal agency has accepted a bid from Superior Federal Bank of Fort Smith to buy the assets of Guaranty Federal Savings and Loan Association of Harrison but closing on the agreement has become bogged down in details, Bruce Mc Neill, Superior's president and chairman, said Thursday. Superior was notified in August that it was the successful bidder for Guaranty, which the Federal Home Loan Bank Board closed a year ago and then reopened as a new institution, Mc Neill said. Negotiations on closing the transaction have continued since then. " It's been frustrating," he added. In a copyrighted article Thursday, The Harrison Daily Times broke the news that Superior had been notified it was the successful bidder. Closed December 1985 The Home Loan Bank Board closed the insolvent Guaranty Savings and Loan Association December 6, 1985, with regulators saying the institution's assets were substantially dissipated because of violations of laws and regulations. Mc Neill said Superior, a federally chartered savings bank that is the fourth largest thrift institution in the state with $ 615 million in assets, is seeking to acquire the Harrison and Marshall branches of Guaranty, its equipment and core deposits totaling about $ 50 million. Those branches would be the 26th and 27th for Superior, which also has two offices at Fayetteville. The Federal Savings and Loan Insurance Corporation took over Guaranty's troubled loans. Wants visit from regulators Apparently referring to federal regulators, Mc Neill said: " It has been our plan to _ if we can ever get those people to sit down and say it's a done deal _ come to Harrison and visit with business leaders up there, but it looks like the earliest would be after the first of the year." Regulators said the old Guaranty was insolvent not because of any embezzlement but because of unsound banking practices over 30 months in which the institution grew more than 700 per cent. The Arther Barrett family, which owned the old Guaranty, went to court in an unsuccessful attempt to stop the closing. 342 loans overdue Court records show that 342 Guaranty loans totaling $ 90 million were at least a month overdue. Some 22 of the loans totaled about $ 55 million and were among the big out-of-state construction loans financed by brokered "jumbo" certificates of deposit that regulators blamed for the insolvency, the Harrison Daily Times reported. The new Guaranty was to be managed for three months by Savers Federal Savings and Loan of Little Rock until a buyer could be found. A year later, Savers is still managing Guaranty. But Savers, which was originally considered a likely candidate to buy Guaranty, has been hit hard by out-of-state loan losses itself. The new Guaranty Federal has suffered financial losses, the newspaper said. Max Sherry of Savers said in June that Guaranty had a negative net worth of almost $ 1 million dollars because it was paying out interest on the remaining $ 50 million-plus in deposits without making many loans that would bring in interest money. Other reports are that Guaranty had lost $ 1.5 million at the end of the second quarter. Rebecca Vail, vice president of the Home Loan Bank at Dallas, said Wednesday that the losses were "not because of any actions we feel are occurring because of the management or directors." She said the figures were a "reflection of the reality of the situation they inherited."THE ARKANSAS GAZETTE FORT SMITH72633 Superior Federal's bid to buy Harrison S and L accepted But closing on agreement bogged down in details, chairman says

Welcome To Kurt Saxon's Survivalist Web Pages

"That People Which Eliminates Its Underclass Will

Control The World And Save The Planet."

                                                      --Kurt Saxon

The links listed below are connected to what Mr. Saxon considers to be among

the most important pages at this web site. He suggests that all of you logging onto

this hp for the first time take a look at them first before checking out the rest of

what this site has to offer.

                 KURT SAXON VERSUS NBC

                         DIRT CHEAP CHOW!:

                 The Perfect 3.3 Cent Breakfast

             Saving Money With A Thermos Bottle

                   Raising Catfish In A Barrel

     DEFEND YOURSELF FOR PENNIES! JUST LIKE CLARENCE!:

    CLARENCE THE MIGHTY MARTIAN SLAYER

                WITH SOME ASSORTED ODDS & ENDS:

                     HARD TIMES AHEAD?

             A 1995 KURT SAXON INTERVIEW

           H. F. WATERS: Corrupt Federal Judge

                     KURT SAXON ON SURVIVAL:

Kurt Saxon, owner of Atlan Formularies, is the father of Survivalism. He coined

the word. For years he's collected knowledge on trades, crafts, cottage industries

and survival skills from a past when our immediate ancestors had to do for

themselves on a day to day basis. His work is in anticipation of a time when our

overcrowded and down-bred system goes the way of Rome.

His program is in no way political, racist or religious. He leaves such

considerations to those who seek security in belief rather than practical

knowledge.

The only inalienable right is to die for ones beliefs. Those who choose beliefs

over knowledge, as well as those who don't know the difference, will not survive

the collapse. In most cases, they will have done the only good thing they have

ever done, which is to take their defective genes out of our species.

Atlan Formularies supplies the knowledge to survive. Those who reject such

knowledge are welcome to share the fate of the rest of the doomed herd.

So read the following articles/pages and then e-mail Kurt with your opinions

and/or responce. You may e-mail Kurt directly by simply clicking on our Internet

address a little ways down this page.

                          Table Of Contents:

             Philosophy Of Survival                                        

             Selected Works

             Survival Foods

            THE NEW RONIN

            WHEELS OF RAGE

             Online Catalog

            Latest Additions

            REVOLT AGINST CIVILIZATION

            Grumbles From Cary

           Mail Call!

           Keep'em Laughing!

          Nifty Places To Go

          MISSING PERSON

KURT SAXON VERSUS NBC

                                   By Kurt Saxon

Martha Stewart is suing The National Enquirer because of an article accusing her of being unstable. They

used a psychiatric term which meant, generally, that she is a little dippy, which means she is just like

everyone else. But the article was couched in phrases which, by themselves, may not have been

slanderous, but put together guaranteed that Martha would be perceived by most readers to be seriously

impaired.

For the writer to protest that the article was not meant to be slanderous does no good. The writer and the

Enquirer's editors know very well the perceptions they are creating among their readers.

Martha will win the suit.

On November 19, 1997, NBC aired a piece on bombers. I had agreed to cooperate after being led to

believe that it was to focus on destructive devices on the Internet. My own Internet article showed a fire

bomb described in "Clarence and the Gay Martians." It would give NBC what they wanted and publicize

my web site. A fair exchange, although I realized their piece would not be complementary.

I signed no release. I gave no permission to portray me as being dangerously antisocial, much less to

slander me. But NBC did just that.

The focus of the program was not just on bombs on the Internet but dealt with bombers in general. I was

portrayed, not simply as one who would publish such material but as a bomb maker encouraging others to

make bombs.

NBC focused on my fingerless hand, saying that I had blown off my fingers making a bomb! NBC

interviews hundreds of people each year. Obviously, some of the interviewees have physical infirmities.

NBC does not focus on physical infirmities unless said infirmities are part of the story line.

Had the interviewer said I was mixing some chemicals I did not understand and lost my fingers, that

would not have fitted into the story line. It would have simply put me in the same category as thousands

of people who dabble in dangerous chemicals each year and dabble away their fingers, eyes and

occasionally their lives.

But for NBC to lead their viewers to the obvious perception that I am a bomb maker encouraging others

to make bombs, my accident had to be blamed on a criminal act.

Had I been making a bomb. I would have been committing a felony. I would have had to come up with a

legal reason for my actions. My attitude toward anyone making a bomb without a legitimate purpose was

explained in U.S. Militia, page 159, "Until some real tyranny is imposed, anyone building a bomb should

be suspected of the intent to murder. They should get no sympathy from anyone. If a fool builds a bomb

and it blows up in his face, that's better than if it blows up in yours."

On September 29, 1969 I was wanting some powder to reprime spent shells. I used a formula for making

paper caps, as described in Weingart's "Pyrotechny", page 144 of PMJB New Improved. The ingredients,

mainly potassium chlorate and red phosphorous, were supposed to be wet before combining. I thought

that only applied if one wanted to drop the mixture on paper strips for caps. I wanted mine dry.

I wrote of the accident on page 57 of PMJB New Improved. "The photograph shows a spatula which had

been used to stir a mixture of about 1/2 ounce of potassium chlorate and a bit of red phosphorous. The

mixer was ignorant of the fact that these chemicals together, stirred dry, will detonate spontaneously.

"The resulting blast kneaded the spatulas out of shape. It atomized the first 3/4 inch of the bone handle

and split the rest. It shattered the plastic mixing bottle.

"The fingers holding the bottle had the flesh blown off the bones and the bones had to be amputated. The

palm of the hand was turned into hamburger and its inner bones were smashed.

"The hand holding the spatula was undamaged except for particles of the plastic bottle which pierced the

skin.

"So the shattering effect, although terrible, was only a radius of about two inches from the outside of the

charge of explosive."

No one with a knowledge of explosives, reading this, would associate the process with the making of a

bomb.

The NBC piece began with statistics on bombings overall. But most of the focus was on me. The piece

showed several examples of bombings; the World Trade Center, Oklahoma City, etc. Was the viewer

supposed to believe I was somehow involved, or was the object to show me as the same kind of person

as those who actually did the bombings?

A particularly damning statement of mine was, "Now, you could take a pound of that to the Empire State

Building on a nice summer's day, broadcast it and you'd kill hundreds of thousands of people. It's

beautiful!"

This statement was an example of the damage possible. In its enormity it would indeed be beautiful to the

terrorist who carried out such a crime. But the way it was used in piece was a deliberate indication that I

would approve of such a crime and that I would think it was beautiful. As the statement was used, it was

a lie.

How can it be denied that the piece, focusing on me to the exclusion of others in my field, was to hold me

up to public scorn? There could have been no other purpose. The viewer could have had no other

perception than that I am a dangerously antisocial person, infamous leader in the field of dangerous

information and an advocate of terrorism.

NBC ended the piece with the accusation, "You sell these groups the wherewithal and the means to

execute their vile thoughts and strategies."

My answer was, "Yes, but they don't use them."

NBC responds, "They haven't, not yet."

So here is a piece filled with personal condemnation over crimes uncommitted. NBC showed no scrap of

evidence that in the past twenty-five years since I began to publish such material, that any innocent

person has been harmed due to my works.

Can Jack Daniels, Smith and Wesson, the Ford Motor Company or even Toys-R-Us boast such a safety

record? This being the case, NBC plainly and simply singled me out for character assassination for no

positive reason at all.

And how did I come to be singled out for such defamation? From what I gathered from Fred Francis, he

was alerted to me through Morris Dees, of the Southern Poverty Law Center.

Morris has a business of hunting down and exposing anyone right of center as being a vicious bigot.

Morris is the poor man's Simon Weisenthal.

It was through Morris that Fred came up with the accusation that I was "once an avowed white

supremacist." I never avowed or claimed or considered myself to be a white supremacist. During the '60's

I was a fanatic anti-communist. I joined those groups I considered the most active against the "Red

Menace."

If the piece was to show that my work constituted a clear and present danger, it failed. But the obvious

purpose was to present an arch-villain to NBC's viewing audience. So it was purely personal. And since

the implications were irrelevant, it constituted slander and defamation of character with no social or

editorial value.

Consequently, I intend to sue NBC for said slander and defamation of character.

FROM:              Herb Lair

DATE:               Friday, August 21, 1998

TO:                    Ric Brown

CC:                    Mike McGrail

SUBJECT:        Cablevision  “Mandeville” Contract*

SIZE and TERMS -- CURRENT:

Minimum* $ 2.6 million revenue over next 5 years with as much as  $2 million recognized over the next 12-16 months for Mandeville systems that currently have 450K+ subs.

*The inclusion of the VCC properties will add 500K+ subs and could increase revenue and net between 25 and 50%--depending on regional consolidation strategies yet to be determined. Note: VCC properties are a recent acquisition by CableVision (finalized in the last two months) – the immediacy of the consolidation of the  VCC and  Mandeville  systems was not  known until my recent trip to Argentina (July). Similar geographic and operational concerns for VCC and Mandeville make CUO/CDDS the only solution that can be successfully implemented by the year 2000. ITC acceptance may come after future regional consolidations – currently CV’s IT Director, Marco Moscatelli, has no interest in ITC. Probably views it as a threat to CV’s in-house system in BA.         

EXPECTATIONS:

1 Million subscribers, estimated revenue $3 million with net in the $2+ million range. The number of subs is actual and current, not projected. Additional growth is anticipated via marketing, expansion, and acquisitions.  Estimated minimum 10 regional systems with 100K sub average, using CDDS, 50 – user, AllyNT systems. Eventually could consolidate into three regions and migrate to ITC. 

Pending P.O. from Bull / Argentina will detail contract deliverables, US dollar amount, and terms.

  

Most revenue will be booked prior to 2000.  Revenue recognition will depend on system deliverables  including AllyNT/Oracle along with contracted localizations and customizations.  Delays in the contract signing changed decision to go directly to AllyNT and not install CableWorks/DOS  on an interim basis. Installations of the Oracle version of AllyNT should begin no later than January 1999.

The size, geographic locations, and profile of the CableVision systems are similar to the top 15 MSO’s TCA (CBIS) and Falcon (CSGS) in the US. Those MSO’s have chosen competitive SMS solutions over DDP/SQL and ITC.

Bull will be responsible for conversions, localization’s, installations, and training costs.  Bull is adding six people for this project.

NEEDS:

Need task force  -- made up of CUO/CableData Desktop Solution’s employee nucleus. Assurances that office will remain in Harrison until at least 2000 to ensure continuity, profitability and maximize the net return. At current time there are no back ups for key CUO personnel in Sacramento. Cannot afford to lose key people –e.g. Jaimi McEntire or John Bartlow. No need to re-introduce threat of closing office until key people can be replaced or backups established.  Does not appear likely in the next 12-18 months based on length of time it has taken to transition even the simplest of responsibilities (e.g. front-line support).  After nearly a year, we still do not have the proper profile in customer care to support in-house systems.  Also front-line International Customer Care support transition to Sacramento has not happened and must be placed on a fast track. Support strategy for DDP/SQL is much different than ITC or CW!

Use business plan previously presented to Ric Brown -- additional 2 headcount immediately and more space in Harrison immediately  --- cash flow analysis available from Keith Montgomery. The VCC addition could also increase headcount and resources proportionately in 1999.

 Minimal bureaucracy ---- Recent organizational report changes made to Harrison staff relative to customer care, development, administration, and business administration will work – just need minimal internal (CableData/SAC) meetings and interference.  As well as trips to and from Sacramento when matters can be handled just as well by phone or by staff coming to Harrison.

My direct report or job description should be reviewed. I have no problem other than the obvious -- NA Sales involves North American region, service bureau, and annuity renewals while international sales primarily covers in-house systems, global business, and new business sales. Don’t misunderstand I do appreciate the support and patience, but there must be an effort to minimize CableData (CDI & CDDS) competitive issues early in the sales process (CV account— there was no mention of CableWorks/CUO at an early strategic meeting with TCI International in Denver--could have resulted in losing the CV/ SMS opportunity totally --to either in-house or to competitor, no CableData business at all). Competition from Wiztec is now apparent in Latin America as well as others Proxima, etc. (see below). Particularly for those systems with less than 200K subs. Based on partner feedback, the cost effectiveness of ITC does not begin in a competitive environment until an operator reaches 200K(centralized) subs, unless telephony is an immediate concern.

John Bartlow of CDDS with over 17 years cable SMS experience – also considered one of the best at implementation management by Paul Case (Denver consultant) -- should be assigned project manager responsibility for CV/Mandeville/VCC. Currently reporting to Jil Christensen, Customer Care. Need to have Bartlow’s customer care responsibilities reassigned ASAP.

GENERAL:

We will be able to replicate the business plan we have put together with consultant (Sid Shreeve), Bull Argentina, & CableVision – globally. Others will not be nearly as difficult.

The addition of VCC properties to CV has created a much larger opportunity. Contract signing was delayed until all the new management had signed on and approved the plan. For example last year, at this time, Mandeville was a 300K+-sub opportunity now Mandeville/VCC is a 1 million-sub opportunity.

A small SMS provider called Columbo (PC’s, NT platform, etc.) has teamed with Wiztec in Argentina could be a major competitor for the Supercanal business as well as the Multicanal systems outside of Buenos Aires (not to mention Brazil – Net, TVA, etc.) – If CableVision wasn’t a done deal, Columbo/Wiztec would definitely have re-entered that picture.  There are Mandeville systems currently using the Columbo system – Marco, IT Director for CV, initially endorsed them (when it became apparent his CV in-house SMS would not work) then changed to CW (with the Wiztec/CBIS financial support it may have been a different story) – Pressure from Diego Grande and Sid Shreeve was also a factor.

Wiztec representative reportedly stated at the ATVC – Jornadas cable show in Buenos Aires (July) they were only interested in systems with 100K subs or larger.  Indicated to consultant (ex-Multicanal manager sent by Bull) that Columbo would be used for smaller cable operators.  Information on Wiztec was compiled and given to Enrique Ottino, Bull Argentina.

Roberto Cocciolo, former IT Director for VCC, now project manager for Mandeville/VCC installations.  Cocciolo caused an intense last minute bump in the road with a request for additional technical reviews.

Another competitor, Proxima, is making a strong attempt to enter Latin American market -- made contact with Sid Shreeve – looking for consultants to assist them with entry into market. Proxima is currently being considered by UIH in Brazil. CDDS CW/AllyNT — has the inside track.

George Stewart, CableVision COO, part of the TCI International management has less power (decision making influence) with restructuring. Key person is Mr. Rodino , President and General Manager for CableVision. He was hired in the past 60-90 days. Rodino now personally reviews and signs all major contracts. All major legal documents are referred to the holding company’s (CEI- Citicorp) outside law firm for final review.

OTHER:

Note: The recent acquisition of USTATS (US Telecom Advanced Technology Systems) by CSGS provides them with a modular cable and telephony SMS solution for the convergence market  -- Acquisition of USTATS must have met approval of AT &T relative to SMS needs for the TCI acquisition (completing the integrated solutions Phoenix or Summitrak obviously didn’t).  AllyNT (new CableWorks’ Windows version) is designed to operate with modular functionality.  Third party application databases  (Internet, security, telephony, etc) could be filtered in or out of AllyNT with its customer centric, common front end design. With demise of Summitrak and Phoenix – alternatives to totally integrated code (ITC) must be presented to prospects early in the sales cycle –not as the last resort (a.k.a. –CW/ Windows – AllyNT).

Note: During my stay in Buenos Aires I had dinner with former US Ambassador to Argentina, James Cheek. He still maintains a high profile in the Latin American business community as well as celebrity status by the Argentines and their press (he has a passion for football/soccer—particularly the team sponsored by CV – San Lorenzo). His picture was on the front page of the Clarin newspaper with an interesting article – the next day after we had gone out to dinner. He knows Tom Hicks of Hicks, Muse, Tate and George Stewart, COO of CableVision, as well as the executive management of CEI.  Strongly endorses all companies with Arkansas representation.  My introduction to him came through senior management at ACXIOM (check out their website). ACXIOM, located in Arkansas was the same size as USCS International a year ago, now over a $700 million revenue company (via acquisitions). There could be some CableData international/NA synergy with ACXIOM in the future. ACXIOM also has an international office in London.

Cheek is now retired and living in Little Rock but still actively consults in Latin America (monthly trips). The Ambassador personally contacted CV and CEI executives on our behalf. The Ambassador should be considered and used as a resource.

FINALLY:

 The changing of my salary and incentive plan in mid year should be reviewed. I’m concerned when changes are made of this nature - tends to negate the purposes for an incentive program.  Most of the time spent getting this business was under a different compensation and incentive plan. Why jeopardize an opportunity this large by making unilateral decisions at a key time? AGAIN THERE ARE NO BACKUPS FOR KEY CUO PEOPLE IN SACRAMENTO AT THIS TIME! Potential profitability as well as revenue should measure cableVision contract.  What incentive plan is now in effect for Jaimi McEntire and John Bartlow ? They really need to be convinced they have an incentive plan in force – they both are key to making the CableVision project a success. 

I am also concerned that my title change will create confusion in the international arena.

I T E M:   GLICKEN HAS CONTINUED TO RECEIVE BENEFITS FROM CLINTON/GORE ADMINISTRATION OFFICIALS SINCE HIS GUILTY PLEA:

Glicken owns a company that brokers deals between U.S. and Latin American companies, and is not shy to use his political connections to help his work. In 1996, Glicken showed up at a Florida fundraiser, muscled 4 South American clients into it and introduced them to President Clinton and Mack McLarty, Clinton's top adviser on Latin America. Party officials tried to keep them out, but according to the Wall Street Journal, Glicken "raised a stink", saying "I raised all this money; I can bring in anybody I want." Glicken was given a coveted seat on a Commerce Department trade mission to South America in 1994. He has been hosted by the U.S. ambassadors in Argentina and Chile, and received help from the Argentine Embassy even after he pled guilty to soliciting foreign campaign contributions. Howard Glicken, who admitted soliciting and laundering foreign campaign contributions, Al Gore's Skeleton Closet, Real People For Real Change, 1999

(Glicken somehow arranged for a $6,000 billiards table to be donated to Gore's home. Glicken's son Monte worked for Gore until the young fellow was arrested and fined on charges of drug possession. The license plates on Glicken's two Jaguars read "GORE1" and "GORE2.")...

--------------------------------------------------------------------------------------------------------------------------------

 Democratic fund-raiser pleads guilty

WASHINGTON - Miami business executive Howard Glicken, a veteran Democratic fund-raiser and friend of Vice President Al Gore, pleaded guilty Monday and agreed to pay $120,000 in penalties for soliciting a campaign contribution from a foreigner.

Glicken declined to comment after pleading guilty in federal court. U.S. District Judge Henry H. Kennedy Jr. set sentencing for Nov. 24.

Glicken is one of eight people charged so far by the Justice Department's campaign finance task force.

He admitted seeking the $20,000 contribution for the Democratic Senatorial Campaign Committee in 1993 from a foreign national, who cannot legally donate to U.S. campaigns. He also admitted suggesting that the donation be made in the name of a legal donor.

The maximum penalty for each of the two misdemeanor counts is one year in prison, a $100,000 fine, and a $25 special assessment.

In a plea agreement with the Justice Department, Glicken agreed to a criminal penalty of $80,000 and 500 hours of community service. And he agreed to pay a civil fine of $40,000, which must be negotiated with the Federal Election Commission.

Glicken also agreed to cooperate in the campaign finance task force's ongoing investigations.

Though he was not named in the Justice Department indictment, the foreign national who made the $20,000 in the name of his secretary was German developer Thomas Kramer. The Federal Election Commission last year fined Kramer a record $323,000 for making $418,600 in illegal campaign contributions to Republican and Democratic federal, state and local parties and candidates in 1993 and 1994.

Kramer had told the FEC that he received a suggestion to make a $20,000 contribution to the Democratic senatorial committee in the name of his secretary, Terri Bradley. Neither Kramer nor Bradley identified the person who made the suggestion.

The FEC decided not to pursue a case against Glicken, who has raised millions of dollars for the party and had been expected to play a role in Gore's 2000 presidential campaign. He also has played golf with President Clinton, been an overnight guest at the White House, and attended White House coffee meetings with Gore.

After Glicken was charged, a Gore aide, requesting anonymity, said he foresaw no role for Glicken in the vice president's future political activities.

FEC Counsel Lawrence Noble told the commission that the ''available evidence'' suggested Glicken brought four contributions from Kramer to the Democrats. But Noble advised against pursuing the case because Glicken was likely to contest the FEC's findings, and the agency would not have time to conduct a full investigation before the statute of limitations expired.

By The Associated Press

June 28, 2000

                   How Two Principals in Clinton Scandals

                   Joined Up to Do Business in Jakarta

                   By JAY SOLOMON

                   Staff Reporter of THE WALL STREET JOURNAL

                   JAKARTA, Indonesia -- How did Jim Guy Tucker, the former Arkansas

                   governor convicted of fraud in the Whitewater scandal, end up here?

                   Last year, Mr. Tucker and his wife, Betty, moved to Jakarta to try to

                   salvage a $6.5 million investment they made in 1996 in an Indonesian

                   company now called PT K@belvision. With fresh backing and a team of

                   half a dozen cable experts from home, the 57-year-old Mr. Tucker is

                   trying to stitch together a fiber-optic network that will become what he and

                   his colleagues call "Indonesia's Internet backbone."

                                     That's a tall order in a 17,000-island nation where

                                     less than 1% of the population of 212 million

                                     people has Internet connections. But Mr. Tucker

                                     may have a shot. In the early 1980s, he and his

                                     wife began building a cable empire that eventually

                                     stretched from the southern U.S. to Europe. Here,

                                     he has assembled a team of cable veterans from

                                     the South who are helping in his unlikely quest.

                                     And he has some powerful local connections. It

                                     happens that a controlling stake in K@belvision is

                                     held by Lippo Group, the Indonesian

                                     conglomerate controlled by the family of James

                                     Riady, another prominent figure in President

                   Clinton's financial scandals.

                   The Tucker/Riady partnership, Mr. Riady says, is about building

                   "Indonesia's only real Internet play."

                   Others don't see it that way. The U.S. Justice Department is still

                   investigating allegations that Mr. Riady laundered $1 million in illegal

                   contributions to the Democratic Party ahead of Mr. Clinton's election

                   drive. He also has been cited in a House of Representatives report as

                   having made a questionable payment to the family of Webster Hubbell, a

                   key witness in the Whitewater investigation, fueling accusations by

                   politicians and investigators that he doled out hush money.

                   Mr. Tucker disclosed his Indonesian business dealings to prosecutors and

                   received a lighter sentence in return for his cooperation with Kenneth

                   Starr's investigation. But Mr. Riady's friendship with Mr. Clinton leaves

                   some prosecutors who were involved suspicious.

                   Solomon Wisenberg, former deputy independent counsel in the office of

                   Mr. Starr, says, "Obviously, it's a concern to any prosecutor when a major

                   cooperating witness is being paid large sums, whether for legitimate work

                   or not, by a crony of a person being investigated."

                   Mr. Riady denies the allegations, and Mr. Tucker says he has never

                   received any money from Mr. Riady except for funds related to their

                   business venture.

                   The two men first met in the 1980s, when the

                   future Indonesian tycoon was helping run his

                   family's bank in Little Rock and Mr. Tucker was a

                   prominent local politician and lawyer. Mr. Riady

                   says the two men had only a casual relationship

                   back then, having "met at church."

                   Mr. Tucker and Gov. Clinton were both

                   Democrats and fierce rivals in the 1982 Arkansas

                   gubernatorial race (Mr. Clinton won). Mr. Tucker

                   eventually became lieutenant governor and got the

                   governorship when Mr. Clinton moved into the

                   White House. Soon after, Mr. Tucker was drawn

                   into the scandal over the Whitewater property development when Mr.

                   Starr's probe of Clinton finances resulted in fraud charges against Mr.

                   Tucker.

                   In 1996, Mr. Tucker was convicted of fraud relating to cable-TV loans

                   and for conspiring to avoid taxes. Forced to resign as governor, he spent

                   18 months confined to his house on probation. During this time, he also

                   had a liver transplant. The upshot, Mr. Tucker says now, was that he had

                   "very few business opportunities."

                   So when Mr. Riady contacted Mr. Tucker from Indonesia and asked if he

                   would invest in a cable-TV network here, he took the bet. Indonesia

                   looked good at the time, with an economy that was expanding at a nearly

                   7% annual rate. He and his wife bought $6.5 million in cable equipment,

                   which was subsumed into a telecommunications company affiliated with

                   Lippo Group. The group guaranteed the Tuckers a minimum 5% return on

                   their investment, and Mr. Tucker received a "consulting fee" from

                   K@belvision through a holding company.

                   A year later, the Asian economic crisis struck, shaving nearly 90% off the

                   value of Indonesia's currency, the rupiah, against the dollar, and fueling

                   bloody race riots that forced President Suharto to step down. As

                   Indonesians became poorer -- and imported cable equipment became

                   costlier, thanks to the weak rupiah -- Lippo's cable ambitions were

                   imperiled. So in early 1999, 30 months after resigning the governorship

                   under threat of impeachment, Mr. Tucker decided to move to Jakarta to

                   save the deal.

                   It was a curious lifestyle change from suburban Little Rock. Part of the

                   time, Mr. Tucker lived in the Aston Hotel, a Lippo-owned business in

                   central Jakarta that also has service apartments. On weekends, health

                   allowing, he played golf at Lippo Karawaci, a Lippo-owned satellite city

                   built on Javanese rice paddies. One of Karawaci's landmarks is the gutted

                   remains of Supermall, a Riady project that was home to a Wal-Mart and

                   an Ace Hardware, before rioters incinerated it in 1998. The same year,

                   just outside the Aston, four student demonstrators were gunned down by

                   the Indonesian military.

                   "I don't think Jim Guy has really settled in here," says an associate and

                   sometime golf partner. Mr. Tucker says the majority of his time is spent at

                   the office.

                   There are reminders of home -- other than a Wal-Mart -- among them. On

                   a recent afternoon, David "Rusty" Smith, K@belvision's expert in laying

                   fiber-optic cable, lunches at one of his favorite Jakarta haunts, a Tony

                   Roma's rib joint just down the block from one of the city's biggest

                   mosques. The Louisville, Ky., native, who holds stock options in

                   K@belvision, declares in his deep Southern drawl that by wiring

                   Indonesia, "hopefully I'll be able to work myself out of a job."

                   Across town, his housemate and colleague, Dwight Harlan, originally of

                   Mabelvale, Ark., stands in a pair of cowboy boots at the K@belvision

                   office. "I love the people of Indonesia," he says, though he admits to

                   missing Twinkies and Ding Dongs. A photo of President Clinton hangs on

                   his office wall.

                   Mr. Harlan, an old cable-TV buddy of Mr. Tucker's, moved to Jakarta in

                   1993 to run a Lippo telecommunications project. "I had never really heard

                   of Indonesia" back then, recalls the 54-year-old Mr. Harlan, with a shock

                   of white hair and a Col. Sanders-style beard. Today, he is K@belvision's

                   technology czar. He also has an equity stake in the company.

                   Technology transfer is an important theme for K@belvision's expatriate

                   staff. On a recent afternoon, Little Rock native Mark Lowry instructs a

                   classroom full of Indonesian technical recruits on the delivery process of

                   satellite TV in Jakarta. Clad in blue jeans and a T-shirt, Mr. Lowry cuts a

                   casual figure. His Southern accent bewilders some students.

                   "I can understand other people's English much better," says K@belvision

                   recruit Tony Sitanggang, wearing the company's blue uniform. Around him

                   are posters advertising the company's key programming suppliers, such as

                   the Discovery Channel and the Cartoon Network.

                   Evenings for some of the cable guys are often spent at the Bats bar in the

                   basement of the Shangri-La Hotel, in the company of diplomats,

                   intelligence operatives, stockbrokers and young Indonesian women. Mr.

                   Harlan jokes, "Oh, I never goes to Bats," but a cartoon drawing depicting

                   him and Mr. Smith fixing a television set is displayed on the bar's back

                   wall. "We like to make drawings of our most regular customers," says a

                   Bats waiter, straining to be heard over the thunder of a Western funk band.

                   Mr. Tucker's decision to commit to Jakarta looks prescient. Asia's

                   economies are recovering, and Internet start-ups are sprouting across

                   Indonesia from Sumatra to the resort island of Bali. But a high-speed

                   network tying it together is still lacking. "We're looking to get as big a head

                   start as possible," Mr. Riady says.

                   Touring Jakarta by helicopter recently, Messrs. Harlan and Riady look

                   down upon sprawling slums dotted with the occasional mansion, and they

                   see nothing but opportunity. "Everyone can use our service to some

                   degree," Mr. Harlan says. "We just have to see what works for whom."

                   So far, K@belvision wires link to only 112,000 of Jakarta's 3.8 million

                   single-family homes, according to Mr. Riady. By year's end, he predicts,

                   the number will be nearly 300,000, and the company is expanding into

                   Bali, among other places.

                   On a steamy afternoon, Mr. Smith, a block of a man who wears a gold

                   Superman "S" around his neck, directs his Indonesian staff at a work site

                   beside a dilapidated mosque. He concedes that Jakarta has presented

                   challenges. His cables are supposed to follow the city's streetside electrical

                   wires, but what do you do when those wires go straight through someone's

                   house, as is sometimes the case in Jakarta, rather than just into them?

                   "Obviously, we can't follow them through there," he observes.

                   Then there's the mosque. "We have to show religious consideration" when

                   laying cable, Mr. Smith says, as his crew inches closer to the site. "We

                   don't want to cause any ill feelings."

                   At first, K@belvision met with skepticism from segments of the Asian

                   media establishment. There was an impression it was staffed by

                   "rednecks," says Charles Pollard, regional director for Star TV, a unit of

                   News Corp. and a key source of programming in Asia. Mr. Pollard, who

                   is British, says he had read reports of Mr. Tucker's travails back in the

                   States. However, he says, he came to realize that Mr. Tucker "runs a tight

                   ship and has put in place a very good business."

                   Earlier this year, K@belvision, which also goes by the Indonesian name

                   PT Tanjung Bangunsemesta, listed 5% of its equity on Indonesia's

                   Surabaya Stock Exchange, raising about 10 billion rupiah, or about $1.1

                   million. Company executives say they probably will offer more of the

                   company -- or its parent, Across Asia Multimedia Ltd. -- to the public in

                   either Hong Kong or Singapore this summer. Mr. Riady says K@belvision

                   has been valued at $1.6 billion by outside auditors.

                   Mr. Tucker's K@belvision holdings come through his 1.5% stake in

                   Across Asia Multimedia, the information-technology arm of the Lippo

                   Group. Other significant investors with an Arkansas connection include Joe

                   Giroir, another prominent Friend of Bill who also was Hillary Clinton's

                   boss at Little Rock's Rose Law Firm. He also holds a 1.5% stake in

                   Across Asia Multimedia. Mr. Giroir has long served as facilitator of Lippo

                   Group business projects across Asia.

                   Pacing K@belvsion's cramped headquarters one day, Mr. Tucker strides

                   toward a life-size cutout of Wilma Flintstone and declares: "Our workers

                   must learn the importance of meeting targets." He's referring to a cluster of

                   young employees seated nearby, some wearing Muslim headscarves, who

                   are cold-calling potential subscribers. If they don't hit their weekly totals,

                   "they'll find themselves working weekends as well," he says with a chuckle.

                   Should the windfall materialize, Mr. Riady, who is a devout Christian, says

                   he'll be in better position to achieve one of his personal goals: to retire from

                   active business, return to school and pursue a life of philanthropy and

                   Christian deeds. In particular, he says, he wants to build more schools and

                   hospitals in Indonesia. Until then, however, he says he likes working with

                   his Southern colleagues, because "they know hospitality."

                   Mr. Tucker has more modest plans. Sitting in a dark Italian restaurant at

                   the Aston Hotel, he says he would simply like to make enough money "to

                   retire back in Arkansas," and to help his family pay for things like

                   education and weddings.

                   --David Cloud in Washington contributed to this article.

                   Write to Jay Solomon at jay.solomon@awsj.com

Introduction

While cable operators and their subscriber management system (SMS) providers are busy battling the Y2K bug, the “stealth war”, for the subscribers’ eyeballs, is being won by the Internet. The Internet has added in excess of 50 million users over the past four years, something that radio took 38 years and even television 13 years to accomplish. The percentage of homes with PCs will be nearly as high as homes with cable by the year 2002, according to forecasts. Current surveys indicate people with Web access are spending as much time online as they do watching TV.

As convergence becomes a reality, the service providers who survive will be those who develop customer loyalty. Customer loyalty is a direct result of being able to measure customer preferences and then deliver customer satisfaction. The reality is that the Internet Web-site database managers are doing a much better job, managing customer expectations and building databases. Often providing gifts, even PC’s, for subscriber information. At risks: substantial advertising dollars, e-commerce sales and commissions, and subscription fee revenues. Couldn’t happen? Systems who focused on subscriber retention, without a concern for total subscriber revenues, are losing another quiet war with DirecTV. Systems sometimes keep their low-end basic cable tier business but lose their premium channel (HBO, Showtime, Cinemax) and pay-per-view revenue due to the DBS content selection and digital  picture and sound. Potentially 50% of the systems revenue could be lost even with 100% subscriber retention.  Customer preferences were underestimated and poorly measured and monitored. Because of inadequate subscriber preference data and a resulting slow response to digital technology, much revenue was lost and immeasurable damage was done to subscriber relations.

History

So why has cable become so ambivalent about managing and effectively gathering subscriber interests and responding to those needs? From the beginning, cable TV represented a “Field of Dreams,” in that cable operators would build a system and the subscribers immediately came—there was sufficient pent-up demand to attain high percentages of viewers from the homes passed. TV viewers in remote locations were watching snowy pictures and receiving no more than one or two distant stations. Reactive marketing has led to complacency and a false sense of security. Some industry observers may argue that cable operators simply had it too good. Others surmise that they just had to focus on the myriad number of operational issues that were, quite simply, more important at that particular time.

Early SMS solutions from 1948 through 1973 were highly manual in nature, with all work orders handwritten and payments posted over several days on ledger cards. Coupon books were commonly used and monthly bills were less than $5 during cable’s first 25 years. Other than over-the-air broadcasters, there was no competition for viewers.

For the next 10 years, 1973-1983, some automation crept into the subscriber management process, but it was nevertheless limited. The $100,000 minimal cost of an in-house computer with less capabilities then today’s $2,000 PC was far from practical. “Service bureaus” dominated, processing batches of data and mailing bills from remote locations. Data was keypunched and sent by couriers or over dialup modems. Outside competitors such as VCRs and satellite services were still in their infancy, but beginning to grow in importance. Signal scrambling for new PAY-TV services, provided via satellite in the mid and late seventies, created revenue opportunities for operators. However the SMS infrastructure for handling the addressable interface between the subscriber database and converter manager, ala carte billing, and marketing the new services was not ready. Reactive, not proactive management, cost revenue.

Serious needs for advanced SMS marketing, operations and financial database information have come about in the last 15 years. During the past five years, the unparalleled hyper-evolution of the PC industry and multimedia networks via the Internet has magnified the value of a cable customer with bandwidth.  Pay-per-view, VOD, NVOD, pay TV packaging, digital, along with stricter customer service requirements, as well as keener competition from telephony, VCR, and satellite (DBS) providers. But SMS and customer database management continues to take a low priority in the food chain. In many systems, SMS is still viewed as a costly necessity and not as a cost savings or a way to generate revenue. 

What’s needed

A cable MSO cannot allow its legacy SMS solution to restrict business growth. It must invest heavily in database management and marketing and be willing to make Internet technology their new best friend. They should remove immediately any thoughts that they are in a monopolistic industry. Competition from the Internet for the subscriber’s disposable income has no geographic limitation. Multimedia content on the net will improve rapidly over the next two to three years. Primitive forms of movies are being tested through sites such as ifilm.net. Broadcast.com, recently purchased by Yahoo for $5.7 Billion, broadcasts music and video events on the Internet. The swirl of activity illustrates “how quickly the Internet is changing from a text-and-graphics medium to a multimedia experience”—Eben Shapiro, staff reporter for the Wall Street Journal. 

Even though marketing databases are not cheap, the value of a household has multiplied as the number of in-home offices and homes with multiple phone lines have exploded. Consider the recent prices paid for systems by AT&T, Paul Allen, and Comcast. Add in the number of subscribers with cellular phones, pagers and Internet access, and it’s easy to see the value attached to each home in recent system sales. Because households are becoming the equivalent of small enterprises, long-term success will require effective data warehousing and data mining.

Proper SMS strategy and direction are essential. One of the most innovative television products to flop was introduced in the late 1950s. The combination of TV, AM-FM radio and phonograph was an ill-conceived experiment in integration. It might have made for a nice piece of furniture, but unfortunately, the color TV was being rapidly improved and replaced every two years and the phonograph was evolving to 8-track tape (and later, to cassettes and CDs) and the radio, well it could last forever.

Then, modularity became the king. Similarly in the SMS arena, there have been several attempts to develop all-inclusive products that have never seen the light of day (e.g. Tele-Communications Inc.’s Summitrak, CSGS’ Phoenix project, etc.). Problems, as well as the expense, to integrate and coordinate computer code, technologies, and software releases to cover diverse businesses such as cable TV, telephony and data became prohibitive. Now convergent SMS providers must be willing to work with system integrators or function as integrators or enterprise resource planners (ERP) to provide total solutions built from modules.   Bill Gates states in his new book – Business @ the Speed of Thought – “that as more standards evolve … the more likely the ‘best of breed’ tack will be used to buy independently the best product modules available instead of buying from just one vendor “.

Today, there are no silver bullets within legacy software. They all have the ability to handle the basic needs of cable operators, and have similar appearances. But as they evolve, SMS providers must provide visionary and innovative leadership. They have to be willing to kill their cash cows, if necessary. Given the new competitive environment, there’s too much at risk for the operators to maintain the status quo. They are no longer “just” entertainment providers, but technology providers. Must expand SMS vision and that will only come when they are willing to make substantial, proactive investments in the future. Emphasis must be on customer and process, not product.

VISION

The Internet must become the center of future SMS systems, not just an auxiliary tool. Substantial cost reductions will be realized by redirecting call center’s, billings, payment collections, as well as many CSR inquiry and service functions through the Internet. Enabling the same self-service that consumers have become accustomed to in banking, securities, and e-commerce products and services will be key. Giving virtually real-time control and monitoring of cable systems in remote locations, as well as foreign countries, via company Intranets will also be critical.

(DIAGRAM ONE)

Can you imagine having the ability to enter a personal preference profile into an application so that the TV not only directs you to your preferred program, but also gives you pertinent advertising information on products and services of interest much like Amazon.com? Allowing consumers to provide input about upcoming programming schedules via e-mail or through an on-screen guide is an incredibly powerful tool that the Internet offers.

CUSTOMER PREFERENCES => CUSTOMER SATISFACTION => CUSTOMER LOYALTY

Online Web-based CSR functions could reduce costs by as much as 50 percent over the existing 800-number call centers and collection methods. Additional estimated savings for online bill presentation range from 20 cents to 50 cents per billing as paper; postage and processing are either eliminated or drastically reduced.

(Diagram TWO)

The revenue gold mine could come from the ability to substantially reduce the costs of direct marketing via mail and telemarketing by providing, for a price, the one-to-one retailing data gathered by knowing the buying habits and preferences of customers. This is another byproduct of transitioning to the digital era.

The best solutions will probably come from consultants and solution integrators using ERP. SMS solutions will consist of a Web server accessed at various security levels by employees and customers through their Web browsers. Modular “enterprise” applications and databases will be accessed through computer languages such as Java, ActiveX and JavaScript. The Internet will serve as an extension of an operator’s network. Customers will use features from companies with universal acceptance and standards - e.g. movie previews provided on the net by the studios, schedules from TV Guide and payments via credit card providers or companies such as Checkfree.  Stay with mainstream, open standard solutions.

Legacy SMS cable providers must realize their value lies in their ability to translate their core competency into visionary solutions and then to make those visions reality.

Herb Lair

BA and MS Mathematics

University of Arkansas

President

CUO.COM

Formally

Computer Utilities of the Ozarks, Inc.

Over 25 years providing SMS to the cable industry

870-741-6440

LEBEDEV HAD SERVED for decades in the SVR’s

                         predecessor organization, the Soviet-era KGB, and it was

                         there that he made the acquaintance of the man who would

                         later prove so instrumental in the success of his career:

                         Vladimir Putin.

     “Let me tell you

     that the romantic

     perception of

     intelligence work

     and romanticism

     is, incidentally,

     what prompts

     many young

     intelligence

     operatives to come

     and work for us.”

     — LT. GEN. SERGEI

     LEBEDEV

     head, Russian Foreign

     Intelligence Service

                                 So it was interesting to hear Lebedev respond to an

                         interviewer’s question about the romantic lure of life in the

                         world of espionage. “Romanticism is present,” answered

                         Lebedev. “Let me tell you that the romantic perception of

                         intelligence work and romanticism is, incidentally, what

                         prompts many young intelligence operatives to come and

                         work for us. This element ought to be present in our work.

                         However, if you compare it to James Bond films, there is a

                         lot of fantasy there, of course.”

                                 For now, Lebedev, along with most of his colleagues

                         in Russia’s vast army of past and present spies, has elected

                         to maintain discreet silence about the distinctly unromantic

                         story of Robert Philip Hanssen, the 56-year-old FBI agent

                         accused of 15 years of spying for the Russians. The SVR’s

                         press spokesman, Boris Labusov, politely declined to

                         comment on the case. Other official representatives

                         followed suit. (Lebedev’s reluctance to comment on the

                         case seems a particular pity; prior to his present job,

                         Lebedev worked for two years as the SVR’s official

                         representative in Washington, the city where Hanssen was

                         doing his best work for the Russians.)

     The accused

                                                            Of course,

                                                    governments rarely like

                                                    to dwell on their own

                                                    espionage operations.

                                                    Even more striking,

                                                    though, has been the

                                                    restraint of the Russian

                                                    media in its coverage

                                                    of the case. The

                                                    evening news shows

                                                    have buried their

                                                    accounts of the

                                                    Hanssen scandal at the

                                                    end of their

                                                    broadcasts. And most

                         journalists have largely contented themselves with

                         regurgitating Western press reports and subdued

                         speculation about how Hanssen’s cover was finally blown

                         after his 15 years of lucrative betrayal. Why the relatively

                         low-key coverage? It might have something to do with the

                         fact that many of the most prominent people in Putin’s new

                         Russia are alumni of the old KGB intelligence

                         establishment-people like Putin’s powerful national security

                         adviser, Sergei Ivanov.

                                 Still, Russian journalists have come up with a few

                         tempting insights into the Hanssen affair. Some are

                         theorizing about a possible link between Hanssen’s

                         unmasking and the defection last year of a high-ranking

                         Russian United Nations diplomat named Sergei Tretyakov.

                         According to several Russian press reports as well as a

                         recent article in The New York Times, Tretyakov’s

                         diplomatic job was actually a cover for his work as an

                         officer of the SVR. “As an officer of the SVR, he worked at

                         the same time for American intelligence,” noted the

                         Moscow newspaper Segodnya. “When it came time to

                         make a choice, the diplomat decided to remain in the U.S.

                         with his wife and daughter, and, in exchange for the favor of

                         the American authorities, Tretyakov probably had to

                         provide detailed briefings to the CIA and FBI. And this was

                         the time, according to official information, that the U.S.

                         intelligence services first learned about the work of

                         Hanssen.”

                                                           Another paper,

                                                   Nezavisimaya Gazeta,

                                                   accused the George W.

                                                   Bush administration of

                                                   violating a gentlemen’s

                                                   agreement between the

                                                   Russians and the Clinton

                                                   White House to keep the

                                                   Tretyakov case under

                                                   wraps. As many

                                                   Russians see it, the new

                                                   administration’s decision

                                                   to announce the year-old

                         defection two weeks ago fits neatly into an apparent new

                         policy of tough talk from Bush deputies about Russian

                         misbehavior. Many Russians appear only too happy to join

                         in with the new spirit of cold-war revivalism. One Web site

                         article on the Hanssen case offers the following forecast:

                         “Judging by everything, the American intelligence services

                         will be subjected to a thorough check-and after that, the

                         check may well be extended to all the other citizens of the

                         U.S.”

                                 Meanwhile, Maksim Sokolov, a famously sarcastic

                         commentator on Russia’s most widely watched TV channel,

                         took issue with a remark by President Bush, who claimed

                         that the Hanssen case should serve as a reminder to

                         Americans that “we live in a world that doesn’t share our

                         values.” Did the president mean to imply, Sokolov asked,

                         that Americans would never stoop to spying on other

                         countries? Nope, he rejoined: “all intelligence services

                         everywhere in the world do the same work.” Not very

                         romantic, to be sure, but probably true.

                               

                                © 2001 Newsweek, Inc.