The Digital Research Initiative
The University of North Carolina at Chapel Hill

THE COMPANY

Olympia Media operates a diversified group of broadcast, cable operations and newspapers in the mid-South, but is best known for its recent success in establishing cable networks. The company operates a broadcast group of radio and television stations, all in mid-South cities: Norfolk and Roanoke in Virginia; Charlotte, and Raleigh in North Carolina, and in Columbia, South Carolina. It has newspapers in Greenville, S.C., Winston Salem, Norfolk and Roanoke. The company's cable operations are mostly in northern Georgia and coastal South Carolina, with its largest system serving Myrtle Beach and Charleston. It has about 400,000 subscribers.

Nationally, Olympia is best known for its Climate Channel, which reaches over 80 per cent of cable homes with national and local weather services. The company is also known for its Family Values Channel which reaches an even larger audience with a wholesome menu of reruns, mostly westerns, sit coms and family movies that are especially appealing in rural communities. A third channel, the Voyager Channel, dedicated to travel and travel advertising, has been struggling to gain distribution due to channel capacity problems.

OLYMPIA AND THE NET

Most of the managers of the company's various divisions have established Internet services and homepages. The newspapers have been most enthusiastic, primarily for defensive reasons, as they fear that telephone companies and cable operators may use the net to compete for classified advertising revenues. Publishers once hoped to generate substantial ad revenues and subscription fees through on line services, but have been disappointed. Recently, they have grown very concerned about Microsoft's motives in establishing local information services on the net through its Cityscape service.

The cable networks have established home pages to help promote viewing, and possibly to provide interactive ad possibilities for some advertisers. Managers of the Voyager and Climate Channels have had some discussions with Microsoft about an alliance patterned on the NBC/Microsoft MSNBC model. They hope to use Microsoft on the net to gain revenues for specialized weather and travel services, advertising and transactions; and to benefit from cross promotion between net browsers and cable viewers.

Some of the television stations have home pages for promotional purposes, but see little revenue potential. Two general managers are opening discussions with Warner Bros. about CityWeb, a syndicated web service for tv stations. Radio general managers are more bullish, however, and see revenue potential in working with companies like Audionet, that use the Internet to enable distant listeners to tune into radio sports broadcasts and other programs in dozens of markets.

The manager who is most enthusiastic about web potential heads the company's cable operations. The cable manager foresees substantial revenues from leasing cable modems to subscribers anxious to gain high speed connections to the Internet. The cable systems manager has explored working with established Internet services like Interpath or Mindspring. This could work well for Olympia's cable systems in coastal South Carolina, which are currently being upgraded for greater bandwidth. However, it may be too costly to upgrade the other mostly rural systems of Olympia sufficiently to provide digital services and cable modems. In fact, the CEO has worried that the scope of Olympia's cable operations may not justify the capital required to upgrade them, especially with competition from DBS mounting. Two major cable corporations have recently approached Olympia, offering to buy the cable systems.


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