NEW YORK — Cablevision is beefing up its executive suite, naming Tom Rutledge chief operating officer. In the newly created position, Rutledge will report to prexy-CEO James Dolan. He also becomes an executive officer of the corporation.
Rutledge has served for the past two years as president of Cablevision’s cable and communications division. He said the move comes as part of an overall restructuring of management in preparation for the spinoff of Cablevision’s satellite and programming unit Rainbow DBS later this year.
“This was an opportunity to solidify management of the ‘new’ Cablevision and bring in new resources,” Rutledge told Daily Variety.
Rutledge’s responsibilities will be taken over by John Bickham, most recently exec VP at Time Warner Cable.
The shift caught many on Wall Street off-guard. One analyst noted that patriarch Chuck Dolan’s departure as CEO of Cablevision to run the soon-to-be-spun-off Rainbow unit may have created a senior executive vacuum back at Cablevision, where his son now reigns as CEO. Jim Dolan runs the cable business, as well as Madison Square Garden, Radio City Music Hall and the Clearview cinema chain.
Dolan junior will also take over from his father and become chairman of Cablevision once the Rainbowspinoff is completed — possibly in the fourth quarter of 2004.
Rainbow programming chief Josh Sapan will also be anchored to the new unit. For tax purposes, company said there can be no overlap of staff between Rainbow and Cablevision.
The new Rainbow stock will comprise the startup Voom DBS platform, as well as cable program nets WE: Women’s Entertainment, AMC and IFC.
In addition to the company’s cable networks, consumer products and Lightpath business telecom services, Rutledge will oversee the Rainbow Media assets remaining with the parent company post-spinoff, such as the regional sports and news channels and music net Fuse.
Cablevision services some 4.4 million homes in the greater New York metro area. Under Rutledge’s reign, the company has achieved the highest penetration of high-speed broadband of any U.S. cabler operator and was the first MSO to roll out IP telephone services across its entire footprint.
Rutledge wouldn’t comment on whether Cablevision may be a target for a buyer such as Time Warner but said his team was on track to deliver free cash flow this year.
“We’ve reduced our capital expenditure, are finished rebuilding our cable plant and have increased venue per subscriber from the high $50s to high $70s in last few years,” he said.
Cablevision will announce its first quarter results May 10 and is expected to post healthy high-speed-data and digital cable gains. But despite steady revenue gains, programming and marketing costs at Voom are likely to drag down the company’s profits.