NTL

» see ntl.com as it lived, on the wayback machine

~ the goodbye ~

In 2002 i was paying by the hour in an Ankara internet cafe and dialing a Turkish ISP from home. NTL was a hole in a British street with a coaxial cable at the bottom of it, and Turkey never dug that hole. We went from dial-up straight to ADSL over the copper phone line that was already there, so cable broadband is a category i have read about rather than used.

The company was American. Barclay Knapp and George Blumenthal incorporated International CableTel in New York on 27 September 1992 with the intention of buying British cable franchises, which had been handed out region by region in the eighties and were mostly too small to build anything serious. So CableTel bought them. In 1996 it acquired National Transcommunications Limited, the privatized transmission arm of the old Independent Broadcasting Authority, and in May 1998 it took that company's initials as its own name.

The 1999 purchase of Cable and Wireless Communications' consumer business for close to £8.2 billion finished the job. One operator now held over ninety percent of British cable. By 2005 it had 3.2 million customers against $6.1 billion of revenue. The people paying those bills did not love it: a customer complaints forum ran for years under the name ntl:hell and had to rename itself CableHell after the Virgin rebrand, which is not the arc of a company with a good call center.

~ the chronicle ~

~ the debt ~

The strategy was to borrow against growth that had not arrived yet. Cable is capital in the ground before it is revenue in a bank, and NTL had spent the late nineties putting a decade of capital into the ground on the assumption that broadband subscriptions would show up fast enough to service the loans. Interest rates moved and the dot-com money stopped, and the assumption did not hold.

On 8 May 2002 NTL filed for Chapter 11 in New York, listing $16.8 billion of assets against $23.4 billion of debts. It emerged in January 2003 having converted roughly eleven billion dollars of debt into equity. That made it the largest debt default in US corporate history to that point, and almost nobody watching television on an NTL box that week noticed anything at all.

~ the postmortem ~

NTL and Telewest had spent a decade as the only two cable companies in Britain, in territories that did not overlap, which meant they never actually competed. They merged on 3 March 2006 and the result was called ntl:Telewest, a name that tells you nobody had decided anything yet. In July 2006 the company bought Virgin Mobile from Richard Branson, and part of what it paid for was a license to use his name.

The corporate entity became Virgin Media Inc in November 2006. The consumer brands went on 8 February 2007, when Branson and chief executive Stephen Burch stood up in London and NTL and Telewest both stopped existing on the same morning. Nothing was switched off. The network and the billing system carried on exactly as before. Only the word on the van changed.

~ the inheritance ~

Virgin Media is still the second largest fixed broadband network in Britain, and it runs on what CableTel spent the nineties buying up with borrowed money. The debt did the building and the bondholders took the loss in 2002, which is one way to get national infrastructure financed. Nobody has since tried to lay a second one.

There is a smaller inheritance in how it failed at the end. In November 2006 NTL bid for ITV and was turned down flat, and BSkyB bought a blocking stake within days. The company that had consolidated an entire industry could not buy a single broadcaster, and three months later it did not have a name of its own anymore.

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