Field Reports1 Sep, 2004 By: Thomas Haire, Nicole Urso Reed Response
Satellite Taking Customers Away From Cable Operators
NEW YORK — The Wall Street Journal reports that a study by Kagan Research LLC shows that, for the first time since cable television's birth in the 1950s, the television service is losing subscriber households — more than 900,000 U.S. subscribers during the past two years. The reason? More U.S. households are moving from cable service to a satellite service provider than ever before.
On Aug. 4, Comcast Corp., Cox Communications Inc., and Time Warner Inc. (three of America's largest cable companies) announced combined subscriber losses of 171,000 in the second quarter of 2004 alone. In comparison, leading satellite provider DirecTV, gained 455,000 subscribers in the same time period.
News Corp.'s DirecTV and EchoStar Communication Corp.'s Dish Network expect to add more than two million subscribers in 2004. The cable networks are also facing pressure as satellite providers team with regional phone companies to package phone, TV and high-speed Internet services at a single price.
FTC's Busy Summer Continues With New Filings, Findings, Injunctions
WASHINGTON, D.C. — The Federal Trade Commission (FTC) has had a busy summer dealing with direct response companies' claims in a series of advertising campaigns — two of which involve long-time FTC target and infomercial host Kevin Trudeau. Most recently, on July 8, the commission announced that a Chicago federal judge found Trudeau in contempt of court for violating a July 2003 stipulated preliminary injunction in the Coral Calcium case.
In the ruling, Judge Robert W. Gettleman found that Trudeau had violated the injunction when he disseminated direct mail pieces and an infomercial that made claims that his Coral Calcium is an effective treatment or cure for cancer or other diseases. The court ordered Trudeau to cease all marketing of Coral Calcium and expressly reserved the right to impose additional remedial measures.
In a new filing involving a product endorsed by Trudeau, on June 24 the FTC charged that Smart Inventions Inc. (and its Chief Operating Officer Jon Nokes) and Biotape developer Darrell Stoddard made false and unsubstantiated claims that the product, which resembles electrical tape, can treat or cure severe pain. The complaint, filed in a California federal court, also alleges the defendants falsely claimed Biotape is superior to common over-the-counter analgesics, topical creams and ointments in treating pain.
The FTC had previously sued Trudeau in June 2003 for his role in the Biotape infomercial, charging that his false claims violated a 1998 federal court order. This contempt action against Trudeau is still pending.
In a third major case, the FTC won a July 1 preliminary injunction against Donald Barrett, Direct Marketing Concepts Inc. (DMC), and ITV Direct (ITV), as part of the commission's case alleging that the defendants deceptively marketed and made false disease-cure claims about their dietary supplement product, Supreme Greens with MSM. The injunction, which prohibits the challenged disease claims raised in the FTC lawsuit and any asset dissipation, will remain in effect pending the outcome of a trial on the FTC's allegations.
Atomic Direct Releases New White's Electronics Radio Spots
PORTLAND, Ore. — Atomic Direct is now airing new 30- and 60-second DR radio spots for White's Electronics, the nation's leading manufacturer of consumer metal detectors. The spots, now airing on Clark Howard's national consumer advice radio show, touch on the fun and recreational benefits of searching for hidden treasures with a White's metal detector. The spots were created to complement Atomic's 2003 DRTV campaign for the company. Atomic's production team includes executive producer Doug Garnett, agency producer John Gurney and account executive Skye McEntire. Russ Gorsline of Portland-based Rex Post produced the radio spots. The White's line of detectors includes specialty products for searching underwater, prospecting for gold and all-purpose detectors. The company's products range in price from $300 to $1,300.
DMA Sets Sights on Big Easy for 87th Annual Show
The DMA 87th Annual Conference & Exhibition
Oct. 16-20, 2004
Ernest N. Morial Convention Center, New Orleans