Robert J. Wussler is not exactly your run-of-the-mill Washington executive.
A 30-year veteran of broadcasting, Wussler has spent his entire career working in the glittering world of network television, rubbing shoulders with the famous, the politically powerful and the rich. He has Hollywood connections and Walter Cronkite’s home phone number.
He is the kind of guy who always has a ringside seat at heavyweight prize fights, right next to billionaire Donald J. Trump and Don Johnson of “Miami Vice” fame.
So what is a guy like that doing at a place like Communications Satellite Corp., a decidedly unglamorous company that operates in the gray, regulated world of satellite communications?
A whole lot, if Wussler has his way.
“How far will they let me go?” mused Wussler, the new chief executive of Comsat Video Enterprises Inc., the Clarksburg-based commercial video unit of Comsat. “I don’t know, but we’re going to find out.”
CVE, one of many players in the pay-per-view market, beams movies, cable programming and videoconferencing services to about 300,000 hotel rooms nationwide using Comsat’s satellite network. The unit was acquired by Comsat, a leading provider of international satellite communications services, in 1987.
Comsat officials are hoping that Wussler, recruited from Turner Broadcasting System Inc. in August, can use his industry contacts, programming know-how and broadcasting savvy to do what they have been unable to do in three years: Turn CVE into an industry powerhouse.
According to analysts, that will not be easy. Historically, Comsat has not fared well with its unregulated businesses and CVE, at the moment, is no exception.
People who know Wussler, or know of him, do not doubt that he can pull it off. This is the same man, after all, who has written a few chapters in broadcasting history almost single-handedly.
“The burden of proof remains on management to demonstrate that it can be successful in a non-regulated market,” said George Dellinger, an analyst with Washington Analysis Corp. “They can talk until they’re blue in the face, but all we’ve seen is quarterly red ink on video. They’re not even close to break-even.”
So far, Comsat’s $150-million investment in CVE is not even close to paying off. The unit lost $5 million in 1987 and $9 million in 1988, with more red ink--up to $13 million worth--expected this year. Though Comsat is profitable, the unit is not expected to push into the black until 1991 at the earliest, analysts say.
Why has the unit performed so poorly?
The reasons are varied, but most industry experts agree that CVE has failed to prosper under a Comsat management more accustomed to dealing in the safe, regulated world of satellite communications than in the furiously competitive free-for-all of broadcasting, a business where fortunes can be won or lost on creativity and gut instincts.
True, CVE has made modest improvements in the three years since it was acquired by Comsat: The unit has increased its client base to include more hotel rooms--almost 300,000 this year--and broadened its in-room video offerings to include other guest services, such as hotel check-out, guest messaging and room service menus.
But CVE has failed to expand beyond the lodging industry or to pursue commercial applications for a wide variety of other satellite technologies available through Comsat.
“Comsat video is not as well situated as it could be right now,” said Hutch Vernon, an analyst with Legg Mason Wood Walker in Baltimore. “They’ve really needed someone who could help them with programming, and just about every other aspect of that business.”