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The weather forecast for the cable industry is cloudy, to judge by attendance at this year's Western Cable Show. Typically one of the biggest annual events for the cable television industry, this year's convention was attended by only 17,056 people, approximately half the number that attended the year before. Attendance disappointed the California Cable Telecommunications Association, which hosted the event in Anaheim the last week of November.

CCTA organizers had predicted that show falloff would be 30–40% compared to last year, not 50%, according to a report by Broadcasting & Cable. "We're not immune to a recession," explained CCTA vice president of industry affairs C. J. Hirschfield, who attributed weak attendance to "a slowing economy, a post–September11 reduction in business travel, and consolidation among programmers."

This last item—consolidation—was the theme of remarks by CNN founder and AOL Time Warner vice chairman Ted Turner, who told conference attendees that he believes there may be only two cable operators remaining in the US within a year or two. Turner didn't speculate as to which of the seven major players would be left standing, but he did predict the sale of AT&T Broadband sometime in the next 24 months, and mentioned that the losers of the bidding war may have to merge to remain competitive. "If AOL Time Warner gets it, that will force Comcast and Cox to merge," he speculated.

Turner Broadcasting System's 1990 acquisition of the MGM film library was one of the precursors to the ongoing merger-and-acquisition frenzy in the cable and broadcasting arenas. The highly-leveraged acquisition led to TBS being bailed out by a consortium of cable companies, one of which was Time Warner.

The deal gave Time Warner and Liberty Media Corporation veto power over TBS expansion, and limited Turner's options. "I got a little overconfident," Turner said of his dealings with then-president of Time Warner Gerald Levin, and he expressed enormous dissatisfaction over the fact that Levin prevented him from buying the NBC television network for $5 billion in 1995. (Time Warner acquired TBS in 1996; TW was subsequently acquired by Internet giant AOL.) Turner will retire from AOL Time Warner at the end of this year.

The winner of the cable wars will be whoever has "put the purchasing power together to afford to buy [rights to] the Super Bowl, the NBA finals, the Academy Awards . . .You become marginalized if you don't have the prime real estate," Turner stated, referring to the programming power of the major networks.

In a related development, a broadcasting trade group announced November 29 that it would oppose the acquisition of Hughes Electronic Corporation, operator of the DirecTV satellite television service, by EchoStar Communications Corporation. The proposed $26.1 billion buyout, already approved by Hughes corporate parent General Motors, would create a single unified direct broadband satellite service providing signals to all of North America. The two services together serve 16.7 million subscribers.

National Association of Broadcasters (NAB) president Edward Fritts accused EchoStar of consistently "challenging congressional mandates, ignoring FCC rules, and [engaging in] bad faith business dealings—all to the detriment of consumers. The burden is on EchoStar to explain how America will benefit by combining the only two satellite companies that compete with cable," Fritts said. The same comment could apply to possible large-scale consolidation by cable companies. An EchoStar-DirecTV merger could "expand the delivery of local network channels via satellite to nearly 85% of US households," according to EchoStar spokeswoman Judianne Atencio. Two separate congressional committees will begin hearings on the merger the first week of December.