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EXCLUSIVE DEALS STOP COMPETITORS
FROM COMPETING IN HOME SHOW

Visitors to the Buffalo Home and Garden show next month will see a model "Adelphia home" wired with security service, high-speed Internet and, of course, cable television.

What the 80,000-odd visitors won't see is a satellite dish, the wireless alternative to cable.

That's because Adelphia Communications bought exclusive rights to display digital TV service at the show, organizers said, barring satellite competitors.

Although show organizers say the exclusive deal is routine, it has sparked criticism from a competitor and from some officials who oversee the publicly owned Buffalo Convention Center, where the annual home show is held.

"I think it's wrong," said Buffalo Common Council President James W. Pitts, a member of the Convention Center board and chair of the council committee that oversees Adelphia. "Adelphia has a lot of money . . . if they're flexing their muscle, I think it's cause for concern."

Pitts said he would seek to have the contract changed to open the show to Adelphia competitors.

Exclusive deals that block competitors are permitted by business law, but that hasn't stopped them from raising controversy. In Western New York, school districts that sold exclusive "pouring rights" to soft-drink companies have attracted scrutiny in recent years.

Adelphia's exclusive deal is a routine part of large sponsorship packages, show manager Lynn Davis said. Other major sponsors of the home show -- including First Niagara Bank and Buffalo.com -- also exclude competitors.

"I have people from American Express and stockbroker companies I have to turn away" she said, because of First Niagara's exclusive contract to display banking and financial services.

DMG World Media, the London-based event organizer that runs the Buffalo home show, signs similar exclusive deals with exhibitors throughout the country, said Dwayne McKillop, national sales manager.

But Intertech Digital Entertainment, a Lockport company that sells satellite service, is crying foul about Adelphia's deal. Intertech said it has displayed satellite service at the home show for 15 years. This year, Intertech was told it can attend the show and display television sets, but not satellite television service.

"Our core business is satellite TV -- that's what we do," marketing director Karl Schmelz said.

Company attorney Arthur Russ said he thinks Adelphia's deal violates business law that limits exclusionary contracts.

"We're taking the position that it's contrary to the public interest," Russ said. Contracts that lock out a competitor may violate state and federal business law if they harm the public, he said.

Adelphia didn't seek the exclusive deal, area manager Thomas Haywood said. It came with a high level of support for the home show that organizers solicited from the Coudersport, Pa.-based cable company.

"The show people came to us, they needed a large sponsor," he said. "If they don't get big sponsors, the show might not happen." Haywood said he didn't know the dollar value of Adelphia's sponsorship.

He denied that Adelphia was muscling out competition, a charge leveled by Intertech. In homes without cable, Adelphia's largest competitor is over-the-air television, not satellite service, Haywood said.

Adelphia has about 500,000 subscribers throughout its Western New York service territory, or 67 percent of homes that can be served by its cable system, according to reports filed last year.

Intertech is free to sign exclusive display deals at other venues -- including future editions of the Buffalo home show, Haywood said.

"Next year, if this deal comes down, they have the right to come to the plate, as Adelphia has," he said.

What Adelphia and Intertech seem to agree on is the value of exhibiting at the home show, scheduled this year for March 10-18. The event -- the No. 1 annual draw at the downtown convention center -- is an important stage for showing off products to area residents, both companies said.

McKillop at DMG said the company is reviewing Adelphia's contract in light of Intertech's complaint, and will issue a response shortly.

Telling organizers of the home show how to do business might backfire, according to Erie County legislator Dale W. Larson, R-Lancaster, who served for six years on the convention center's board. If exclusive display rights are common in the industry, taking a stand against them could drive sponsors away from the Buffalo show, he said.

"It's risky business for the board to start getting into who a client wants to let into their show," Larson said.

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